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There are almost no 1-bedroom apartments for rent in CABA and their prices increased more than 230% in one year - Infobae
Source:
www.infobae.com
October 24, 2023
This was confirmed by a private report. There is concern because the shortage of supply deepened after the reform of the Rental Law
By José Luis Cieri
A man supports the weight of a house on his shoulders, representing the challenges of high rents, rising costs of living and economic pressure (Illustrative image Infobae)
Searching for rentals across the country has become increasingly challenging, while prices have risen sharply. A private report reveals a 233% year-on-year increase in rents for 1-bedroom apartments in the city of Buenos Aires.
The context of accelerated inflation adds uncertainty to the task of establishing values that will be valid for one year for those who must adjust contracts by the Rental Contract Index (ICL) and every six months for those who sign agreements from now on with the Rental Law recently modified, through the Casa Propia coefficient. This, although it is a matter of macroeconomics that goes beyond contractual agreements, is reflected in high initial costs. Although these costs tend to decrease rapidly due to current inflation rates, they represent a considerable obstacle to entering into a new rental agreement.
Accelerated inflation adds uncertainty to the process of establishing rental values that will be applicable for a year, especially for those who must adjust contracts according to the Rental Contract Index (ICL) or every six months under the recent reform of the Rental Law approved in June 2020. Recent modifications introduce semiannual updates through the Casa Propia coefficient. Although this challenge is related to macroeconomics and transcends contractual agreements, it results in significant upfront costs. Although these costs tend to reduce rapidly due to current inflation rates, they represent a significant barrier for those looking to access a new rental home.
In addition to the strong increase in 1-bedroom apartments, the Scalabrini Ortiz Center for Economic and Social Studies (CESO) confirmed in its work that 2-bedroom apartments increased by 215.8% year-on-year and studio apartments by 205.1% in CABA.
Source: Scalabrini Ortiz Center for Economic and Social Studies (CESO)
Aldana Montano, CESO economist, told Infobae that, despite the reform in the law, an immediate slowdown in rental price increases is not expected. “The interannual variations have surprised by their constant increase, far surpassing other economic activities. The macroeconomic problem is worsening, especially in CABA, due to the low supply of housing, competition with temporary rentals and alternatives such as Airbnb.”
Experts maintain that with the reform of the law, the most convenient thing for the owner is that the adjustments are semiannual (by Casa Propia coefficient) and not annual (by ICL).
“In addition, it is expected that owners will be able to access tax incentives. With the implementation of restrictions on temporary rentals, it is likely that more owners will choose to allocate their homes to traditional rentals. This would lead to a gradual increase in supply, which, in the long run, could improve the situation,” said Emilio Fauro, of Fauro Propiedades.
Source: Scalabrini Ortiz Center for Economic and Social Studies (CESO)
Prices vary according to various characteristics such as the age of the property, the presence of a garage and other outbuildings, as well as the environment surrounding the property, including infrastructure and accessibility to transportation and shopping centers.
It is important to mention that the values mentioned do not include utility bills, which represent on average 10.9% of the rental cost. In CABA, no expense falls below $25,000 per month.
Source: Scalabrini Ortiz Center for Economic and Social Studies (CESO)
Montano said that “the general economic situation has left its mark on the rental market, and despite the recent reform of the law, a decrease in prices is not anticipated due to these changes. The stabilization or reduction of values will depend largely on the correction of inflation and the resolution of recent devaluations. "So far, there is no effective solution in sight to address inflation, which is the underlying problem, and generate a positive impact on rental prices in CABA and the rest of the country."
Examples of rentals for 1-bedrooms in different neighborhoods: $280,000 per month in Belgrano, $220,000 in Flores, $190,000 in Almagro, and $170,000 in Balvanera.
Fauro highlighted that “1-bedroom apartments experience more pronounced increases due to their high demand. This category represents the majority of rental inquiries, and the shortage was accentuated due to the conversion of some of these properties into temporary rentals in CABA. Of the 10 inquiries received to rent apartments, 6 or 7 are for 1-bedroom properties.”
For 2-bedrooms, monthly prices vary depending on the neighborhood, averaging $320,000 in Núñez, $300,000 in Caballito, $271,000 in Villa Crespo, and $312,500 in Flores.
www.buysellba.com
Source:
Casi no hay departamentos de 2 ambientes para alquilar en CABA y sus precios aumentaron más de 230% en un año
Así lo confirmó un informe privado. Hay preocupación porque la escasez de oferta se profundizó luego de la reforma de la Ley de Alquileres
www.infobae.com
October 24, 2023
This was confirmed by a private report. There is concern because the shortage of supply deepened after the reform of the Rental Law
By José Luis Cieri
A man supports the weight of a house on his shoulders, representing the challenges of high rents, rising costs of living and economic pressure (Illustrative image Infobae)
Searching for rentals across the country has become increasingly challenging, while prices have risen sharply. A private report reveals a 233% year-on-year increase in rents for 1-bedroom apartments in the city of Buenos Aires.
The context of accelerated inflation adds uncertainty to the task of establishing values that will be valid for one year for those who must adjust contracts by the Rental Contract Index (ICL) and every six months for those who sign agreements from now on with the Rental Law recently modified, through the Casa Propia coefficient. This, although it is a matter of macroeconomics that goes beyond contractual agreements, is reflected in high initial costs. Although these costs tend to decrease rapidly due to current inflation rates, they represent a considerable obstacle to entering into a new rental agreement.
Accelerated inflation adds uncertainty to the process of establishing rental values that will be applicable for a year, especially for those who must adjust contracts according to the Rental Contract Index (ICL) or every six months under the recent reform of the Rental Law approved in June 2020. Recent modifications introduce semiannual updates through the Casa Propia coefficient. Although this challenge is related to macroeconomics and transcends contractual agreements, it results in significant upfront costs. Although these costs tend to reduce rapidly due to current inflation rates, they represent a significant barrier for those looking to access a new rental home.
In addition to the strong increase in 1-bedroom apartments, the Scalabrini Ortiz Center for Economic and Social Studies (CESO) confirmed in its work that 2-bedroom apartments increased by 215.8% year-on-year and studio apartments by 205.1% in CABA.
Source: Scalabrini Ortiz Center for Economic and Social Studies (CESO)
Aldana Montano, CESO economist, told Infobae that, despite the reform in the law, an immediate slowdown in rental price increases is not expected. “The interannual variations have surprised by their constant increase, far surpassing other economic activities. The macroeconomic problem is worsening, especially in CABA, due to the low supply of housing, competition with temporary rentals and alternatives such as Airbnb.”
Experts maintain that with the reform of the law, the most convenient thing for the owner is that the adjustments are semiannual (by Casa Propia coefficient) and not annual (by ICL).
“In addition, it is expected that owners will be able to access tax incentives. With the implementation of restrictions on temporary rentals, it is likely that more owners will choose to allocate their homes to traditional rentals. This would lead to a gradual increase in supply, which, in the long run, could improve the situation,” said Emilio Fauro, of Fauro Propiedades.
1-bedroom apartments go up more
Average rents for 1-bedroom apartments are around $230,000 per month, while studios apartments range around $180,000 and 2-bedroom apartments reach $300,000 per month.
Source: Scalabrini Ortiz Center for Economic and Social Studies (CESO)
Prices vary according to various characteristics such as the age of the property, the presence of a garage and other outbuildings, as well as the environment surrounding the property, including infrastructure and accessibility to transportation and shopping centers.
It is important to mention that the values mentioned do not include utility bills, which represent on average 10.9% of the rental cost. In CABA, no expense falls below $25,000 per month.
Source: Scalabrini Ortiz Center for Economic and Social Studies (CESO)
Montano said that “the general economic situation has left its mark on the rental market, and despite the recent reform of the law, a decrease in prices is not anticipated due to these changes. The stabilization or reduction of values will depend largely on the correction of inflation and the resolution of recent devaluations. "So far, there is no effective solution in sight to address inflation, which is the underlying problem, and generate a positive impact on rental prices in CABA and the rest of the country."
Examples of rentals for 1-bedrooms in different neighborhoods: $280,000 per month in Belgrano, $220,000 in Flores, $190,000 in Almagro, and $170,000 in Balvanera.
Fauro highlighted that “1-bedroom apartments experience more pronounced increases due to their high demand. This category represents the majority of rental inquiries, and the shortage was accentuated due to the conversion of some of these properties into temporary rentals in CABA. Of the 10 inquiries received to rent apartments, 6 or 7 are for 1-bedroom properties.”
For 2-bedrooms, monthly prices vary depending on the neighborhood, averaging $320,000 in Núñez, $300,000 in Caballito, $271,000 in Villa Crespo, and $312,500 in Flores.
www.buysellba.com
