Buenos Aires Real Estate

At the last season of the Buenos Aires real estate conferences held on November 17th 2011, the Urban Planning Minister of Buenos Aires shared some interesting details on the current urban situation in the Argentine capital.

Urban and town planning is an area that is closely linked and related to the real estate market and is particularly important in a city like Buenos Aires. With a population of 14.2 million in just one city, the capital of Argentina faces some unique challenges. The strain of housing so many millions of citizens means that the city’s priorities include; housing, construction and urban planning.

At the Buenos Aires real estate conference the minister of urban planning clarified his stance in the Buenos Aires real estate ‘boom:’ the statistics show that in recent years activity has in fact decreased. The Buenos Aires real estate market has seen the annual amount of metres squared of property reduce. This means that there is less construction work and fewer homes being constructed across all neighbourhoods. So Buenos Aires is by no means experiencing a boom in the construction industry, especially when compared with past decades.

The demographics of Buenos Aires show that the number of inhabitants and families in need of housing is increasing whilst the number of available homes is going down. This is a worrying trend that is pushing up demand and prices. To ensure that the city grows in a sustainable way to incorporate newcomers some areas of the city will have to become more built up. This means that more high rises will have to pop up in neighbourhoods that were previously under developed, as the pattern of growth adapts. However, areas that have been protected under conservation and heritage law will remain protected.

Statistics show that urban growth in the city centre has been quite limited as developers are restricted by the scarcity of land and high prices. The outskirts of the city are experiencing the most concentrated development of real estate and urban areas. Within the city boundaries of Buenos Aires there was 4.1% growth in development whereas in the outskirts there was a huge 25% rise in growth. If this pattern continues, creating an unmanageable and low density urban sprawl, then the government will be faced with huge pressures on infrastructure, transport networks and the city centre will also become strained.

Compared to European cities, Argentina has an intermediate level of urban development. The layout and structuring of Buenos Aires is similar to that of other compact European cities except it is on a much larger scale.  These are all interesting considerations to take into account when assessing whether to invest in the Buenos Aires real estate market.