Buenos Aires Real Estate

In a smaller conference than in past years, this year’s Real Estate Market Conference (Salón del Mercado Inmobiliario) was filled with industry professionals enthusiastically networking, debating, and conversing about today’s industry issues. Not as narrow-minded as other occasions have been, this conference gave way to opinions that were less than unanimous, allowing for some interesting discussion to take place, and everyone to participate.

In the first panel of marketers had some interesting things to say. Ivan Achaval commented that the investor market is the one pushing today’s prices, while Roberto Tizado noted that there is a lot of optimism about the future of the Buenos Aires real estate market, but the increase in costs has sent up a bit of a red flag. Luis Ramos also expressed his concern about inflation in dollars, and the fact that there is a superfluous amount of 1- and 2-room units for sale. He also referred to the industrial real estate market and the income received by investors from rentals. As there is so much supply, the departments are not generating more than 4 or 5% income today, he noted.

Herman Faigenbaum, another one of the panelists, talked about the retail sector of the industry, saying that the market is in high demand, due to government policies. He commented that he wasn’t entirely sure if now was a good time to buy, but Achaval and Tizado didn’t agree, pushing those listening to continue shopping.

Later, within Carlos De Narvaez’s conference, the ALRIO project was presented, which will be located in Vicente López, which was without a doubt the launch of the conference, and maybe of the entire year.

Hector Lostri, who is the Secretary of Planning in the Buenos Aires Ministry of Urban Development faced the questions about the changing city code, and commented that the changes are being fulfilled in baby steps, but being fulfilled nonetheless. Jorge Cruces, on behalf of IRSA, noted that the Buenos Aires real estate market continues to be relatively cheap on an international scale, especially with residential properties. He said that investing in IRSA is good business today, as their portfolio would be undervalued in relation to the market. Today’s IRSA action is affected by the country risk, he said, calling for investors to reconsider.

Claudio Destefano, another invited panelist, is a journalist who specializes in business, and referred to communication and media in the real estate business, punctuating his talk by closing with some of the summaries of the event that were being transmitted by Reporte Inmobiliario via Twitter.

Other important observations and predictions included the following: The real estate values in Palermo through the next year will virtually stay the same; the price level is reaching a “ceiling’, from the standpoint of the investor; and that there is a large supply of apartments for rent, but a very low demand, especially in the US$2000 – 3000 range.

Eduardo Costantini was the most anticipated speaker, and he did not let his audience down. He predicted a strong economy and market in the coming year, talking of the favorable situation that Argentina has in terms of export prices. It is a popular place to buy for the international market, and the low debt helps the economy, and the chances of it continuing to grow. He called for an indexing system in Argentina, so mortgages could be possible.

The conference report showed real estate price performance figures, comparing the evolution of new apartments in different areas of Buenos Aires, along with construction costs, inflation, the price of gold, and wages. Figures showed that property development was doing well in relation to the variables analyzed, expect for gold, which has increased dramatically in value in recent years.