fbpx
South American Real Estate News

Slide gateway to south america's news resource BRings you local news and views from the region Experienced Investment news local knowledge information resource for investors real estate marketing Gateway to South America Real Estate News line Icon home Icon home Icon home brokerage services www.gtsanews.com www.gatewaytosouthamerica.com Click here now for real - estate opportunities Experienced argentina brazil chile paraguay peru uruguay agro business lifestyle real estate marketing Gateway to South America Real Estate Services high end residential Farm investment tours Icon home Icon home Icon home Icon home brokerage services
line www.gatewaytosouthamerica.com
Slide Real Estate News Service South American Focused 1000's Of Happy Subscribers Argentina - Brazil - Chile- Paraguay - Peru - Uruguay Bilingual Posts Free Subscriptions www.gtsanews.com www.gatewaytosouthamerica.com Slide Real Estate News Service South American Focused Slider Revolution is the highly acclaimed
slide-based displaying solution, thousands of
businesses, theme developers and everyday
people use and love!
1000's Of Happy Subscribers Argentina - Brazil - Chile- Paraguay - Peru - Uruguay Bilingual Posts Free Subscriptions www.gtsanews.com
/ All categories of countries are / Argentine’s farmland in USD terms collapses: experts reveal which locations to now invest in

Argentine’s farmland in USD terms collapses: experts reveal which locations to now invest in

Post available in: English Español Português

As in other sectors, the pandemic has been making itself felt in the worst possible way and that is in rural real estate activity. So, what are the areas to invest in?

The paralysis evidenced by the lack of sale of properties in the urban areas, rural real estate activity also transits one of its worst moments with operations close to zero in the past two months. These same indicators are the one that opens up opportunities for investors with cash, with the prices in key areas of agricultural production areas that operators already 20% or more below the previous values before the emergence of covid-19 and the establishment of quarantine.

This percentage of decline, marketers point out, is valid is for almost all of the most attractive agricultural areas. But among rural real estate sales companies, they also recognize that in marginal agribusiness, locations rebates can approach 50%.

Farmland in Formosa, Salta, Corrientes, some areas of Tucumán, Patagonia and even in the southern part of the province of Buenos Aires, are now marketed at unthinkable values compared to last year.

Opportunities also arise in Rio Negro, a province that according to real estate experts has enormous potential for the development of activities such as livestock and the exploitation of milk through dairy farming.

“In such a complex scenario for the economy, in general, we are encountering movements in terms of consultations and valuations.

However, there is a very positive horizon because it is well understood that the world will need more unpolluted food.

The farmland then reappears as a favourable option, Federico Nordheimer, director of rural real estate company told iProfesional.

“Today the interest in farmland also makes sense in so far as there was no government intervention in rural activity unlike other areas of the economy. Exports have not been affected, and livestock activity remains unchanged. For those who have saved in dollars, it is a unique opportunity because prices can be negotiated downwards, in some cases by very important percentages. Good farmland guarantees an income and whilst the owners are not desperate to sell, they listen to offers,” he said.

Nordheimer explained that, depending on the areas, prices have fallen by 50% and that such a change in values is actually a continuation of the depreciation of farm prices that began to take shape in the second half of 2019.

“There is a scenario of values that fell from the result of the PASO and what we see now is a decline that continues to expand. Today any field whose hectare price was in the order of USD 400 can be quietly traded for half that value.

In key areas of the north of the province of Buenos Aires, we can find fields whose value has dropped 20% in recent months”.

Looking at examples of securities, the expert detailed that in the central and southern province of Buenos Aires there are fields that are listed at a rate of USD 3,500 a hectare – a decrease of 30% from the first half of 2019 – whilst in the west of Buenos Aires Province a hectare can be traded at USD 5,500 – a fall of 20% compared to last year.

He also stated that in the core farming regions the values depreciated by about 20 %, so the hectare rate is now in the order of USD 12,000. Both the north of the province of Buenos Aires and the south of Santa Fe show a decline that will intensify in the second half of the year he said.

Nordheimer also noted that at the edge of Santa Fe with the province of Córdoba the values accumulate a decrease in what goes from 2020 of the order of 15%. In that area, the farmland holds a value of the order of USD 10,000 a hectare.

In other areas of Argentina, the fall in prices becomes more apparent. The interviewee told iProfessional that in the horticultural valleys of Cuyo in Mendoza Province the value of the land has been declining of up to 25 %, even in the areas of highest wine production.

“The hectare value went down to values of about USD 13,000, which was unthinkable a few years ago.

Of course, especially in Mendoza, the variation is very strong, since the province has its peculiarities in terms of water availability, rationing and irrigation capacity.

Areas that do not have the greatest attributes in that regard today have land with values close to USD 400 a hectare. The difference is huge,” he said.

Nordheimer highlighted the investment opportunities of farmland today on sale in Rio Negro Province. “It’s a Province where you don’t have a strong dependence on the climate to produce. At the same time, there is water in abundance. The only point against it is that you have to invest in the infrastructure to start production. But there are very attractive farms for their potential for livestock and dairy farming,” he said, and then indicated that in that territory of Patagonia it was possible to find hectares of USD 6,500 – down 30% from 2019.

Already in the rest of the southern tip of Argentina, the valuations fluctuate widely according to the agricultural or tourist potential of the land. Thus, whilst in Patagonia’s prime farming areas a hectare can reach USD 4,000, in the centre and west of the same area the price of the hectare does not normally exceed USD 400 dollar.

Farmland value forecasts are grim

From the Argentine Chamber of Rural Real Estate (CAIR) its vice president, Gerardo Kahn – in addition to pointing out to iProfessional that the sales have been close to zero in these times of pandemic – predicted a higher price decline from the surveys that the entity has been doing among its partner operators.

“There is a predominant sense of values will go down further. This is the prevailing view among operators. They point out that this price drop will be in a range of 10 to 20%. Traders agree that in order for there to be a revival of the sale the values have to shrink a little further,” he told the company.

“Beyond that prognosis, opportunities are incredible for those with dollars in their hand. Of course, everything is subject to negotiation, and it is worth remembering that this scenario is not that like the 2001 crisis.

In other words, landowners don’t suffer from indebtedness so they don’t despair about not selling either. But there is a growing predisposition to listen to offers,” he acknowledged.

Kahn acknowledged that “in marginal areas, possibilities arise from owners who accept discounts of up to 50%”, and stated that apart from the sale option “there is a very strong, very active demand for farms for lease”.

One challenge is that lawyers and notaries are still not working in a normal way thus slowing transactions. Once those kinds of complications are overcome, there will be another perspective to move forward with sales,” he concluded.

Source: iProfessional ( translated )

(Visited 182 times, 1 visits today)
Gateway to South America

About Gateway to South America

Gateway to South America was established in 2006 as a single office in Buenos Aires. The company has since expanded into a vibrant regional network, servicing the Southern Cone clients in Argentina, Brazil, Chile, Paraguay, Peru and Uruguay with professional real estate marketing services. If you enjoy reading our news site please share it on your social media below.

Post available in: English Español Português

Make a comment on this post

Your email address will not be published. Required fields are marked *

Visit Us On LinkedinVisit Us On FacebookVisit Us On TwitterVisit Us On PinterestVisit Us On Instagram