Buenos Aires Real Estate

It’s no secret that the housing market in Buenos Aires has been under stress lately, and much of that is due to the lack of affordability for prospective buyers. In fact, finding a property for under $45,000 USD is nearly impossible.

This figure does not refer to the large apartments, or the most desirable locations. No, this is for a simple, small apartment, usually a studio. This is what is usually looked for by those wishing to buy their first property. Unfortunately, these prices are high in comparison to the asking price for the larger, nicer units. These apartments are also often sought after by investors looking for a good rental property.

This high price, especially relative to the rest of the market, only further highlights the gap between the local (peso) wages and the dollar price of current properties on the market. It also explains the rise in the demand for rentals, which are already difficult with prices of $1000 per month, augmented by the difficulty in getting a guarantor

So it is no surprise that the hardest part about buying that first home is in finding financing. These usually young buyers would be able to avoid paying rent (at a higher price than the square meters’ actual value) and would own their first home. But the trouble comes in financing, even when the properties are at a mere 25 m2.

Values should be around $1300 USD per m2, but property values haven’t dipped, regardless of the harsh market. They can afford to continue to ask so much because there just isn’t too much for sale. With today’s land and construction costs, and developers profitability proposals, departments simply can’t be offered for much less than $50,000 USD.

Some smaller units are being constructed in an effort to make better use of the space, but this results in cramped apartments without much storage space. These apartments are popping up in areas such as Boedo, San Cristobal and Parque Patricio, however.

But these smaller units are expected to hold their value even better than larger ones. Those who have, say, $ 200,000 USD even prefer to invest in three or four smaller apartments than a grand, 100 m2 place.

The best money saver for prospective buyers is going to be location. Some neighborhoods in the Buenos Aires real estate market like Congreso, Villa Urquiza, Agronomía and Floresta are the best places to find deals, but Barrio Norte, Recoleta, Palermo and Belgrano are nearly impossible.

Many current owners would like to downgrade to save some money, moving from a 2-bedroom to a studio, but for the first time ever, the rates of the two apartments are hardly different, especially if the studio is in a good location. Studios are simply overpriced based on the rest of the market.

Of course, deals can be found, if you search long and hard. The best bet is to look at all the factors, from location to building age to square footage to the subway to even the floor. Hopefully things will start to look up soon.