Lifestyle House Hunting in Argentina could get you a bargain
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The housing market is still faltering after a sharp decline in the Argentine peso in many of the prime lifestyle locations in Argentina
A good example is what is happening in Mendoza. Luján de Cuyo is a small town in the western province, a wine-producing region celebrated for its abundant Malbec grapes.
It sits at the eastern foot of the Andes Mountains, in the high-altitude vineyards of the upper Mendoza valley. The area is known for its Malbec but also produces other high-quality varieties of wine. The centre of the city of Mendoza is only about 25 minutes away. The mountainous area also offers hiking, horseback riding, boating, and skiing. Governor Francisco Gabrielli International Airport in Mendoza is only a 40-minute drive. In short a wine lovers paradise.
The Real Estate Market Overview is Grim
Like the rest of the housing market in Argentina, Mendoza’s real estate has been “strongly impacted” by the country’s currency collapse.
Prices in the past few months have dropped and are still weak in USD.
Investors, typically the most common buyers for lifestyle vineyards, are still “reluctant to invest in Argentina,” and many foreigners have sold their assets in past years. There are still a lot of properties for sale, but too few buyers.
At Algodon Wine Estates, a wellness, golf, tennis and equestrian resort with coveted backyard vineyards, only six or seven houses have been finished in phase one of development, out of approximately 97 lots that range from half an acre to seven acres and start at $120,000.
The most popular locations with foreign and luxury buyers are “without a doubt” private gated communities with “beautiful amenities, with 24/7 security.
Condominiums are plentiful and popular in the region. “They are widely requested by an ascending socioeconomic class, particularly with buyers between 35 and 45 seeking round-the-clock private security and a “premium lifestyle.” Units of around 120 m2 to 130 m2 sell for USD 180,000 to USD 200,000.
The Opportunity
The landscape has never looked better for investors who like to look for countercyclical opportunities. The upcoming elections next year have created hope in the market that has been depressed under the Kirchner-influenced regime for some years and will be replaced by the current business-friendly opposition, which is highly likely. Argentina’s success today in the World Football finals has also boosted the local population’s morale.
Tourism has returned after Covid in numbers never seen before. Many of these visitors will end up in love with the country and want to live there.
The fear is that the current Peronist/K government will stay in power and drive the country’s path again towards Venezuela has gone as some of the main Peronists involved have been removed, jailed or have lost favour.
For those able to move quickly, the opportunity to buy in one of the most attractive locations in the Southern Hemisphere is still there.
The Current Foreign Buyer Profile in Argentina
In North West of Argentina, foreign lifestyle buyers are mainly from Brazil and Chile, with some North Americans in the mix.
The Europeans and Americans who buy in the area usually prefer “fincas” — estates or rural properties.
Damian Tabakman, dean of the EN Real Estate School of Business in Buenos Aires, was quoted as saying that several gated real estate developments with vineyards previously drew foreigners to Mendoza, but “nowadays, because of the local economic situation, only Argentines are the buyers there now.”
Noting that Argentina’s economy has historically cycled through booms and busts, however, Mr Tabakman expressed optimism about the future: “I hope that Mendoza will be able to have foreign buyers again, from Europe and the U.S.A., because projects there are similar to what you may find in Napa Valley.”
The Buying Basics
Dollars, not Argentine pesos, are used for pricing and transactions in Argentina.
Among the requirements for foreign buyers are “a corresponding visa, an ID provided by the government of Argentina and an address certificate provided by the province of Mendoza.
Argentina places some restrictions on properties close to a national border or on a lake. In Mendoza, buying properties west of Ruta 40, a highway that runs the length of Argentina and bisects the city of Mendoza, requires authorization from the Ministry of the Interior. Due to national land laws, properties over 1,000 ha are generally unavailable for foreign purchasers.
Closing or Settlement costs run close to 10 per cent of the sale price; that includes a 2.5 per cent stamp tax and about 3 per cent for notary fees and deed expenses. Depending on the property’s location, the buyer and seller each pay a 3% to 4% commission to the real estate brokers.
Contact the Gateway to South America team to learn about the best investment opportunities in the region. The company is a benchmark for foreign investors wishing to invest in Argentina, Brazil, Chile, Paraguay, Peru and Uruguay, providing expert advice on property acquisition.
www.gatewaytosouthamerica.com
About Gateway to South America
Established in 2006, Gateway to South America began as a single office in Buenos Aires. Since then, it has grown into a vibrant regional network, providing professional real estate marketing services to clients in Argentina, Brazil, Chile, Paraguay, Peru, and Uruguay. If you enjoy reading our news site, please share it on your social media!
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