Apartment Rental Short term rent in dollar or pesos?

[CarliNeces]

I was just trying to figure out what is the latest law? Is short tern rent for rentals (2-3 months) paid in pesos or dollars as per afip?

Secondly, wanted advise.

I have been staying at the same place for 4-5 years now.love the apartment and the landlord. Just used to the apartment and neighborhood. So don't like to change it.

Last year in April -May 2011, I paid 1300 us$ for it.

This year, for August -October), he is asking me 1700 us$. Do you agree its a big hike .

yes, inflation is there. But the blue dollar exchange rate is sky high. So he is anyway gaining, rite?

How much I should negotiate with him keeping inflation in mind since April 2011.

Thanks

what do you guys think?

 

[DavoSenes]

Personally if it was me i wouldnt pay any more. In the last few months rental prices have been going down from what i have seen, and if you look on craigslist there is alot listed week after week because there isnt the number of foreigners coming here and renting like there was.
I got a apt in april, 35 sqm studio in palermo - plaza guemes, the landlord want US$700 i got for US$500, including all bills - cable tv/internet/gas/phone/electric.

If you look at what the peso has done in a year or so against the US$.

$4.20 last year.
$6.17 now in blue.

http://www.ambito.com/economia/mercados/dolar.asp

Inflation for a year is say 30% - so from last april until now around 40%, so that 4.20 peso last year is worth around 5.90 now in buying power. So with the blue rate at 6.17, he is doing ok, infact way better than ok, plus he gets your US$ which are as rare as hens teeth here at the moment.

If it was me i would either tell him same terms, or a better rate, no way would i be paying more.

 

[TareantelaNapo]

I don´t think there is anything to stop you agreeing to pay dollars, you just need to have "legal" dollars, ie be able to show where you got them from. If you are not an argentine citizen, then I suspect this would not be difficult and that they (AFIP) have easier fish to fry.

As to the rent, its a huge hike. I would say the norm would be around 20% in Pesos and 0-5% in USD. Have you gone several years without a hike? Thats the only objective reason I can think of for such a large increase.

Its possible that he has had a mortgage on the place which he has now had to convert to pesos at much higher rates. Dunno, I am just trying to think of reasons other than that he is just trying to pull a fast one.

Obviously, you like the place but have a look at what else you could get for the same price .... at the end of the day that will determine how much you´re prepared to pay, not whatever I might come up with

 

[CarliNeces]

thanks.

what kind of hike is ok for him .

if April 2011, rent was 1300...what should it be now? 1500? at best?

 

[DavoSenes]

thanks.

what kind of hike is ok for him .

if April 2011, rent was 1300...what should it be now? 1500? at best?

Are you paying in US$ or peso. Because thats makes a big difference.

If you pay in US$ 0% hike - and i would even look for a decrease.
In peso - most people i know here who pay in pesos have been paying 20% increase a year.

 

[CarliNeces]

Sorry I made a mistake.

rent in jan 2010 was 1300

rent in Feb 2011 was 1500

And now in August 2012, he is asking for 1700!

the increase is even from that point of view but considering the blue dollar rate and decrease of tourists, I am not sure.

This is because the exchange was 4.0 in feb 2011 and now its 6.0. So it means a hike of 60% in terms of pesos!

I always pay him in dollar, upfront 3 month rent in one go!

 

[MDirtBoy]

Are you paying in US$ or peso. Because thats makes a big difference.

If you pay in US$ 0% hike - and i would even look for a decrease.
In peso - most people i know here who pay in pesos have been paying 20% increase a year.

That's correct. I just signed a contract for a new apartment and we pay in Pesos. After spending 3 months looking at apartments I can assure you that most landlords are building 22% to 28% increases into their second-year rent levels due to inflation. Don't know about Dollar-denominated rents.

 

[earlyretirement]

Definitely I'd negotiate with the owner and let him know that although you understand with inflation all the bills are more expensive. But also explain the better exchange rates now to help make up for that.

Personally I'm charging the same prices on my rentals that I charged since 2003. I never raised them and never lowered them and they stay rented. Some owners try to get greedy and keep raising every year. It will work for a while but supply and demand will always come into play.

I'd rather keep a rental property occupied with a good client then raise every year and have it empty. Many landlords don't understand that principle. A rental day is much like life...once it goes by you can never get it back (or make money on it). So better to keep it full.

Just make that point to the owner. Especially if you are a good long term client I'm sure you can negotiate to at least keep the rental price the same. If not, wish him good luck and look for another property if you think you can do better. Just make sure it's an apples to apples comparison. There are a lot of junk apartments out there.

 

[LuciaMax]

As an aside, it can be sort of tough if you already are in a decent place, know you can most likely get something a fair bit better for the same cost of even lower, but don't want to risk giving up what you currently know works fine enough only to find new hidden unpleasant surprises in the new place. Such is life I suppose.
Maybe rent a new place for 2 weeks, keep the old one and then see. But then you have to come up with a new deposit without having the one from your current place reimbursed. ?
Just an aside thought.

 

[CarliNeces]

As an aside, it can be sort of tough if you already are in a decent place, know you can most likely get something a fair bit better for the same cost of even lower, but don't want to risk giving up what you currently know works fine enough only to find new hidden unpleasant surprises in the new place. Such is life I suppose.
Maybe rent a new place for 2 weeks, keep the old one and then see. But then you have to come up with a new deposit without having the one from your current place reimbursed. ?
Just an aside thought.

I totally concur. I have given my "yes" to landlord. He is a great guy and the apartment suits me 100% since last 4-5 years. Not in mood of a shock by renting from strangers.

I paid 1500 us$ in march 2011.

Now I will be paying 1650 us$ in August 2012.

Such is life.

Maybe paying more, but peace of mind is there!

 

[earlyretirement]

I totally concur. I have given my "yes" to landlord. He is a great guy and the apartment suits me 100% since last 4-5 years. Not in mood of a shock by renting from strangers.

I paid 1500 us$ in march 2011.

Now I will be paying 1650 us$ in August 2012.

Such is life.

Maybe paying more, but peace of mind is there!

I think that was wise Carli. It works out for both of you that way. There are a LOT of shady landlords in Buenos Aires. But even when they are ethical, there is peace of mind in knowing that you know a flat and building are dependable and everything works. Even when you have ethical owners, you have the hassles of worrying about the hot water not working, or the internet always going out, or the building having problems with electricity or gas.

I rented one of my flats to a long term tenant before and then he wanted me to lower the price for the next period. I couldn't but said I could leave it the same. He went to go take a much cheaper apartment but then after a few weeks he was begging to come back as pretty much nothing worked in the new cheaper place. Unfortunately I already had several rentals so I couldn't take him back.

There is REAL peace of mind in Buenos Aires in living in a place where you are comfortable in and everything works.