Buenos Aires Real Estate

The current state of the Buenos Aires real estate market is leaving some real estate brokers and agents scratching their heads wondering, ‘what is going on?’ The presidential elections that are looming in October are what are going on.  As the elections draw nearer, investors and buyers are becoming increasingly hesitant to break into their piggy banks and invest in property. Up until May the figures reflected a normal, healthy and growing market. However, June showed signs of the market shrinking slightly.

The statistics also show that in the last few months buyers have tended to purchase ready to live in properties that do not require building work or renovations. People are just not willing to risk such an investment when prices could suddenly increase or the economy could falter.

Another change detected in buying habits is the quality of homes bought. Used, older and less luxurious properties are now selling more than brand new builds.  The rising building costs are also impacting  Buenos Aires real estate sales. The cost of labour, materials and land has all increased which in turn pushes up prices and dissuades some buyers. Property developers have had to be creative to get around this issue. Developers now use clever marketing and publicity schemes to make their development seem more valuable to buyers. The prestige of the developer’s brand can now push up the value of a home.

Developers also have to be very careful about when they decide to build. With the uncertain election period coming up they need to tread carefully, having to carry out market research before beginning the development process. A typical problem of the Buenos Aires real estate market is when developers flood the market with small units. These units sell well, but there are only so many people who can buy and occupy these types of units.

Buenos Aires eal estate developer companies would benefit from focussing their construction projects at the market of buyers who already have the savings ready to buy. However, this type of clientele are agribusiness investors who choose to stash their earnings in property but are most likely to not actually inhabit their purchase, but instead rent it out. One type of property that will always sell in Argentina, despite the gloomy economic outlook and election stagnation, is the luxury market. These high-end properties are valued at over $6,000 US dollars per meter squared and are generally not affected by the changes in the Argentine and global economy. However, this sector of the Buenos Aires real estate market can become stagnant when neither buyer nor vendor is willing to negotiate on price.  All eyes in the Argentine real estate market are carefully watching out to see what the Argentine presidential elections bring. We just have to wait and see if the market reacts or whether it’s all a fuss over nothing.