Buenos Aires Real Estate

Access to housing in Argentina hasn’t had the greatest history in recent years, and it continues to be quite a conundrum for many families, especially the younger potential buyers, looking to live alone, or to raise their young family in a home of their own. The economic situation prevents many from accessing a roof of their own, but many banks are still willing to battle through the possible setbacks in this important issue and provide mortgage credit lines. The maximum amount that is offered is AR$500,000, with a term of 20 years. The requested minimum wage is AR$1200, and the fee-income ratio is calculated between 30 and 40 percent. Fixed and variable rates are both available, from 10 to nearly 20 percent. The most frequent borrower profile is represented by a married person (52%), between 26 and 35 years old.

Several banks are offering these lines of credit, but Banco Ciudad is currently the institution offering the most variety of available lines. They are currently promoting their Casa Ahorro, or Home Savings, product, where the client must show the ability to save the projected payment amount consistently over the course of 15 months. The minimum amount is AR$2100, and the maximum AR$3500, making the possible loan around AR$197,500, at a variable rate.

Préstamos Hipotecarios Ciudad Vivienda is another line, with a 20-year fixed rate and no minimum income. And for those who would like a combination rate, there is Ciudad Vivienda, which offers loans with term of up to 20 years, with a combined rate: the first two years are fixed, and the remaining variable. As demand for housing — and, in turn, loans — has gone down, it has prompted banks to make changes to their conditions, lowering the payments by 2%, among other things. The future of credit is conditioned by the stability of the markets. There’s currently a lot of pent-up demand, waiting to receive lines of credit so they can buy.

Banco Hipotecario already has an established program, designed to be used for purchasing, building, or renovating housing. The average amount requested there is AR$165,000, and family income is usually around AR$6500. There have been more than 4,000 lines processed, totaling about AR$650 million. This program alone accounts for about 60% of the mortgages granted since June 2009.

Banco Franco offers funding for up to 60% of the property value in the case of first-time homeowners, with a maximum of AR$500,000. They also offer financing for construction, up to 50% of the cost, with a maximum of AR$300,000. For those who wish to expand or improve on their current home, 30% financing is offered, with a maximum of AR$150,000, and a term of 96 months. Rio Santander is yet another bank that offers lines of credit, also for purchasing, building or renovating.

Although most banks have relaxed their terms and rates, getting a mortgage is still difficult today in Argentina. Most people can only do so with some sort of outside support, usually coming from their parents. It is simply not possible for people to, alone, earn the monthly salaries required by most banks. You can check in check in this Buenos Aires real estate guide for related information like the difficulties with credit.

Another new alternative to a traditional mortgage is provided by Kuantica SA. Their funding proposal allows buyers to pay in 60 installments to purchase new units. Their 30-20-50 system means they must pay 30% up front, and then another 20% in 18 payments, paid in pesos. From there, the remaining 50% is financed at a fixed rate for another 42 payments, which were pre-approved at the time of sale.