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Real Estate News Stable prices boost the market and the country was once again on the radar of foreign buyers - Infobae

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Stable prices boost the market and the country was once again on the radar of foreign buyers - Infobae




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Source:






March 11, 2024


The reference values of the square meter in the used segment. What perspective is presented for developers

By José Luis Cieri


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Specialists project a panorama of possible increases in the values of the square meter in a context where the Argentine capital presents significantly lower prices compared to other large cities (Illustrative image Infobae)

The real estate market of the Autonomous City of Buenos Aires shows signs of stabilization and expectation of a large recovery in the medium term, after experiencing a continuous decline in its values for 56 consecutive months, until October 2023, especially in the used housing scenario.

Specialists project a panorama of possible increases in the values of the square meter in a context where the Argentine capital presents significantly lower prices compared to other large cities in the world.

Currently, the average cost per m2 in CABA is around USD 2,200, which represents almost half of the average value in cities like Madrid, where the value is almost 4,200 euros (close to $4,600).


The average cost per m2 in CABA is around USD 2,200, which represents almost half of the average value in cities like Madrid

Daniel Bryn , Real Estate expert and head of Monitor Inmobiliario, told Infobae that the Buenos Aires real estate market is experiencing two different cycles: a continuous decline for 56 consecutive months, followed by stabilization in the last 4 months. In comparison, cities like Madrid (Spain), with a notable sales volume, are reaching historical value ceilings.

The possibility that housing prices, especially used ones, in CABA continue to increase or, at some point, experience a decrease, will depend on the macroeconomic situation of the country.

Bryn added that “if we measure prices in terms of salaries or purchasing capacity of the residents of each country per m2, Argentina is expensive ; That is, 4.16 salaries are needed to buy 1 m2. In cities like Madrid, it can be purchased with 2 salaries.”


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Source: Courtesy of El Idealista. There you can see the average prices of several cities in Spain.

But apart from the local public, considering the cost of living for a foreigner and the quality, Buenos Aires is presented as a very attractive place for current investment in bricks.

In the real estate context, there is a perception that the Buenos Aires market has reached its lowest point in terms of values and that throughout the current year it will undergo an adjustment process based on the evolution of the dollar. This analysis suggests a possible recovery on the horizon.


Buenos Aires is presented as a very attractive place for current investment in bricks

“At the same time, it stands out that Buenos Aires is notably below other metropolises in terms of prices. Despite being on par with other capitals in aspects such as gastronomy, culture and variety of tourist proposals, the city presents a unique opportunity in the market, offering attractive investment potential compared to its international counterparts," he told this medium. Verónica Tapia , from Century 21 El Yar.


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Source: Real Estate Monitor and Invertire.com; Here you can see the amount of salaries to buy 1 m2 on averages of the last 6 years in CABA

Comparison with Latin America

In the last six months, the value of m2 in Buenos Aires remained stable, with a slight increase in prices in the last 60 days, in dollars. Although this trend may not be immediately reflected in listing prices, it is anticipated to persist in the medium term, signaling signs of stabilization and recovery in the real estate market.

Francisco Altgelt , from Altgelt Negocios Inmobiliarios, highlighted: “CABA is positioned as an attractive option for investors, considering it economically accessible compared to other Latin American cities. In addition, it has lower prices in relation to large European cities, positioning the Argentine metropolis as a favorable opportunity in the current real estate panorama.”

According to data from the Latin American Real Estate Survey (RIAL), from the Finance Research Center (CIF) of the Business School of the Torcuato Di Tella University in collaboration with the Zonaprop platform, Montevideo is positioned as the most sought-after city on the continent, reaching a value of USD 3,166 per m2 (these are the neighborhoods on the coast near the beach of the Uruguayan capital such as Punta Carretas, Pocitos, Malvín, Carrasco). This analysis revealed that the Uruguayan capital leads the list, followed by Mexico City (USD 2,948), Monterrey (USD 2,621) and Guadalajara (USD 2,535).

Good time for homes to rent

The DNU that repealed the Rental Law had a favorable impact on the rental market, generating more attractive conditions for investment in properties. This effect translates into an improvement in rental conditions, which, together with the expectation of an upward price adjustment, creates a favorable scenario for the acquisition of real estate.


With inflation on the rise in dollars, the current scenario is favorable for real estate investment

Bryn highlighted: “The profitability of traditional rentals experienced a notable increase, going from 2% three years ago to 4.2% today, thanks to the conditions released after the DNU.”


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"The profitability of traditional rentals experienced a notable increase, going from 2% three years ago to 4.2% today," said Daniel Bryn (NA)

Considering an expectation of upward adjustment in the medium or long term, historically low prices offer a favorable window to enter the market, supported by the rapid sale of well-valued apartments.

Altgelt specified that the current moment is favorable for the acquisition of homes, a perception shared by the majority.

“Transactions are driven largely by end users, who, motivated by market stability, are choosing to make purchases. It is interesting to note that those who put their properties on the rental market are not, for the most part, recent buyers, but rather individuals who already owned their properties before the release of conditions established by the DNU."


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Two-room apartments are attractive for investors who have savings in hand

There is a growing interest from residents of other locations, especially in 1 and 2 room apartments, and also foreigners, who are looking to acquire larger properties.

Who motorizes the plaza

From the perspective of those looking to buy to reside, the Buenos Aires real estate market presents various options, the preference to expand or reduce the living area being a personal decision.

In the current real estate landscape of Buenos Aires, two forces drive buying and selling operations, according to Bryn:


  1. “Those buyers who, during 2022 and 2023, proposed purchasing an apartment due to political uncertainty, now find opportunities with lower prices and attractive real estate options, which allows them to complete their purchases and negotiate favorable prices; and
  2. Investors observe that their dollar savings are losing purchasing power due to ongoing inflation and the constant increase in construction costs. They fear that the value of the m2 of well will also experience an increase, which drives them to make quick decisions to advance their purchases, taking advantage of the current situation in the real estate market.”


Where to buy more and less

Regarding the dynamics of purchases and sales, neighborhoods such as Palermo, Recoleta, Belgrano, Villa Urquiza, Recoleta, San Telmo, Almagro, Puerto Madero, Villa Crespo, Flores, Barracas, Núñez, Villa Devoto, Villa del Parque stand out and Schoolchildren among the favorites.


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Proximity to the recovered Colegiales Railway Park (next to streets and avenues such as Moldes and Federico Lacroze). In this area there is a growing interest in buying used and brand new homes

While areas such as Parque Chas, Pompeya, San Nicolás, Vélez Sarsfield, Versalles, Villa General Miter, Villa Lugano, Villa Ortuzar, Villa Pueyrredón and Villa Real show less activity.

These preference patterns are due to factors such as location, available services and cultural offerings, among others.


Success in the sale lies in setting an appropriate price from the beginning, which also includes including photos, videos, virtual tour and floor plan.

Verónica Tapia highlights the importance of evaluating personal needs when selecting a property. “However, for investors, it is key to opt for units in the most sought-after neighborhoods. “This choice is based on the premise of faster resale, with the location of the property being relevant and strategic for the success of the real estate investment.”

Success in selling lies in setting an appropriate price from the beginning, standing out in the main portals with a professional quality publication. This means including photos, videos, virtual tour and plan.


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It is key that the real estate professional is able to manage visits to the property and correctly value the home to be successful in the operation (Getty)

According to Daniel Bryn, listing at high prices erodes ownership and reduces your chances of success. A professional appraisal, done by a market expert, adds the necessary value to complete the sale in the short term and at the best possible price.

Tapia highlights three crucial elements to complete the operation:

  • “Choose a motivated real estate agency that guarantees quick responses to queries;
  • “Establish a value in accordance and coherent with the market, and
  • “Evaluate the marketing investment that the real estate company is willing to make.”


Bills

In terms of operating expenses, the usual practice remains that the seller pays a commission of between 2% and 3%, and the buyer approximately 4%.

Francisco Altgelt specified: “The rate of the Stamp Tax was lowered a little. The key is to create a good budget to avoid surprises at the time of writing.”


The current combination of factors such as price stabilization and improvements in rental conditions promote an optimistic scenario for the segment.

Although the sector faced challenges, the current combination of factors such as price stabilization and improvements in rental conditions promote an optimistic scenario for the segment.

“With comparatively attractive prices internationally and opportunities for both investors and those looking for a home, Buenos Aires is positioned as a point of interest on the global real estate board,” Bryn concluded.


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