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Rentals with a new record in June: How much will the contracts that remain under the law that Milei repealed increase? - Infobae
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Alquileres con nuevo récord en junio: ¿cuánto aumentarán los contratos que siguen bajo la ley que derogó Milei?
Los acuerdos celebrados bajo la norma que dejó de lado el DNU del Gobierno se actualizan anualmente. Cuánto se necesitará para costear los gastos de la vivienda
www.infobae.com
May 23, 2024
The agreements entered into under the rule that the Government's DNU left aside are updated annually. How much will it take to cover housing costs?
By José Luis Cieri
Although inflation is slowing down, maintaining household expenses continues to be heavy on tenants' pockets (Illustrative Image Infobae)
Tenants who signed contracts under the 2020 Rental Law, later repealed by the DNU of the current Government, are preparing to face a sharp increase in June. These agreements, subject to an annual update through the Rental Contract Index (ICL), will experience an adjustment of 233.73%, marking a record since the implementation of this scheme for residential rentals.
As a result of this measure, tenants who paid $100,000 until this month will now have to pay about $333,000 until May 2025.
The adjustment has a notable impact on pockets and represents a considerable increase in the domestic economy, especially if the expenses for expenses are added, which, both in the city of Buenos Aires and in the province of Buenos Aires, already exceed $60,000 per month on average .
“It is important to highlight that, despite the shocking nature of these figures, rents under the validity of the repealed law are the only price in our economy that remains frozen for 365 days. After this adjustment, the amounts are frozen again for another full calendar year. In short, this increase covers a total period of two years,” Alejandro Braña , a Real Estate expert and member of the Buenos Aires Real Estate Association, explained to Infobae.
The ICL, created by the Rental Law, combines the monthly variations of the Consumer Price Index (CPI) and the Average Taxable Remuneration of Stable Workers (Ripte) in equal parts. Due to the constant escalation of inflation, the ICL has been rising continuously, although it is still lower than inflation.
Dynamics and expiration of contracts
Although in some Buenos Aires neighborhoods the prices of three- and four-bedroom apartments began to rise for the new contracts after the DNU, the initial values are still high. This situation hinders the economy of households that must face high costs to maintain their homes.
Studio apartments in CABA average $200,000 per month
Since the DNU came into force, the ICL has been maintained as an adjustment method for new contracts, which are mostly agreed with a maximum duration of 24 months and quarterly, quarterly or semi-annual updates.
Miguel Chej Muse , from the Real Estate Market Observatory of the Buenos Aires Professional Association, said that “the CPI also prevails for increases. It is recommended that everything be in writing and different adjustment methods or reviews can be established during the duration of the agreement, but this must be established in advance.”
On the other hand, next month around 12,500 monthly contracts will expire in CABA. This means that several properties will return to the market and others will be renewed under the current conditions of the DNU, with free agreements between the parties.
Braña clarified: “We must not fail to take into account that, unfortunately, due to how harmful the repealed law was, fewer and fewer contracts were signed and people resorted to extensions in self-defense, because the uncertainty was total. This was worse than anything last year, when we were under a local and national election climate throughout 2023, and with an economy in constant deterioration.”
Those who made a quarterly adjustment by ICL in May for contracts signed under the DNU, for example in January, had to pay with an increase of 46.16%; That is, whoever started paying $100,000 now has to pay $146,160 until next September, when they must update their amount again.
Regarding the values in the new contracts, since the validity of the DNU they have decreased on average by 30% in real terms according to the Real Estate Association of CABA.
“Today we see counteroffers from tenants, which are often accepted by the owners, prioritizing the good profile of the tenant, something that did not happen before,” said Chej Muse.
Although starting values are stabilizing, there is still a large price jump with respect to expiring contracts, as these have very delayed prices due to their last update a year ago.
Examples of proposals
Below are some examples of rental apartments tied to adjustments through the ICL on a quarterly or quarterly basis in most cases.Núñez: studio apartment, Cuba at 3800, $300,000 per month.
Congreso: studio apartment, 200 Callao Avenue, $240,000 per month.
Caballito: 2 rooms on Avenida Rivadavia and Espinosa, $320,000 per month.
Retiro: 2 rooms on Avenida Santa Fe and Esmeralda, $350,000 monthly.
Recoleta: 2 rooms on Billinghurst and Paraguay, $250,000 per month.
Saavedra: 2 rooms, Avenida García del Río and Naon, $350,000 monthly.
Palermo: 2 rooms, Charcas and Avenida Scalabrini Ortiz, $420,000 per month.
Villa Crespo: 3 rooms, Luis M. Drago at 200, $350,000 per month.
Barracas: 3 rooms, Rocha at 1500, $340,000 per month.
Almagro: 3 rooms, Sánchez de Bustamante at 800, $320,0000 per month.
Villa del Parque: 4 rooms, Avenida Nazca at 2600, $550,000 per month.
Agronomia: 4 rooms, Helguera at 3800, $480,000 per month.
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