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Subte Growth Drives Real Estate Development

On August 9, 2010, In foreign investment, real estate, by InvestBA
Subte Corrientes

The Subte's expansion is shaping the residential & commercial landscape of BA barrios. (Photo: La Razón)

Of all the amenities Buenos Aires property buyers look for, one of the most valuable is actually state-owned and underground. The Buenos Aires Subte transports well over 1.5 million passengers a day along six lines, and Micaela Vacca of La Razón says future underground stations are shaping the residential and commercial landscape of the barrios above. “The opening of new stations not only increases ridership, it also revitalizes different areas of the city,” Vacca writes, “a growing subway network acts as an economic motor, generating greater interest and expanding investment in housing and services.” For proof, just look at the recent appreciation of properties in neighborhoods like Flores and Villa Urquiza, one of InvestBA‘s favorite value plays.  Median residential prices in Villa Urquiza rose 10% last year from US$148/SF in 2009 to $163/SF today. In the zone of Urquiza bordered by Roosevelt, Álvarez Thomas, Congreso y Triunvirato, there are 49 new developments under construction, and many of those buildings feature 3 and 4-room apartments meaning developers anticipate more families will move to the subte-enhanced neighborhood. Flores, meanwhile, has seen an 8% growth in median prices since the Púan and Carabobo stations opened on the A Line. The H Line, which began service in 2007, will see the Corrientes station open later this year, while the future Hosptiales and Parque Patricios stations are helping fuel new development in areas like the BA Tech District. From demographics to density, incentives to zoning, developers have multiple factors to consider when choosing the perfect location in BA. Based on this market data, maybe a Subte long-range planning map should be their guide.  (Full article in Spanish)

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Hogar Dulce Hogar: BA Homes Hold Value

On July 24, 2010, In foreign investment, real estate, by InvestBA
ba-homes

This 3/2 BA residence with 1,800 square feet and a private garden is on the market for $269,000.

While most of the analysis and data in our Real Estate section centers on apartments and condominiums, La Nación reminds us of the often overlooked values lurking in neighborhoods throughout Buenos Aires: homes. Patient and discriminating househunters can often find attractive, reasonably-priced homes scattered in and around the multiple new construction mid-rises in BA. When considering the purchase of an existing home in BA, zoning is often the top consideration, because porteño homeowners don’t want to be sandwiched between high-rises. For that reason, areas like Almagro, Villa Crespo and Barrio Inglés where high-rise construction is prohibited are gaining in popularity, as are house-centric barrios like Villa Pueyrredón and Villa Urquiza which InvestBA profiled earlier this year. In these neighborhoods, one can buy a quality three-bedroom home with a garage and garden for around US$200,000 to $250,000. La Nación says cost per square foot is one of the most attractive metrics for those considering a BA home purchase, while other advantages include the option of building additions, private spaces like terraces and gardens with outdoor grilling areas and no HOA fees for common expenses and building maintenance. Given the high demand and relatively low inventory level of existing homes in BA, building a new home is often a good alternative, but lot prices in a given neighborhood are the key factor in the build vs. buy analysis. To read the full article in Spanish click here, and to learn more about investment opportunities in Buenos Aires, download the July 2010 edition of InvestBA Privada.

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BA Real Estate Survey: The Usual Suspects

On May 4, 2010, In foreign investment, real estate, by InvestBA
usual-suspects

Recoleta, Palermo and Belgrano remain the Top 3 BA neighborhoods in terms of median price/SF.

A new survey of 465 players in the Buenos Aires real estate sector sheds new light on the market’s strengths, weaknesses and median price levels by neighborhood. LaNacion shares the results of the “Real Estate Scene 2010″ survey led by Mercado and Reporte Inmobiliario. There was general consensus among the respondents that prices are relatively high in BA, and 57% believe prices will continue to rise during the course of 2010. 30% feel prices will stay flat, while 13% think prices could actually fall over the next eight months. Even greater than rising prices, 60% of those surveyed feel the biggest obstacle to home ownership for buyers in BA is, what else, the lack of financing. The affordability outlook is similar for renters, as 64% of those surveyed believe rents will increase this year and 24% predicting the average rent increase will be greater than 10%. Despite the obstacles, the majority of respondents are bullish on the sector’s overall outlook including the prospects that new residential projects will be introduced over the next 12 months. The general mistrust of banks means real estate is still viewed as a tangible, safe harbor asset class for buyers, while the scarcity of mortgages ensures a steady stream of future renters—both Argentines and expats—for those looking for investment properties in BA. In terms of median prices by neighborhood, the usual suspects remain the most expensive and desirable destinations: Recoleta, Palermo and Belgrano. Villa Devoto, Nuñez and Barracas occupy the second-tier in terms of affordability while Villa Urquiza, as noted previously on InvestBA, is growing in popularity and moving up the rankings in all categories.

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BA Real Estate Investing Outside “The Big 3″

On March 15, 2010, In foreign investment, real estate, by InvestBA
Rooftop view from a 3-room apartment in Parque Patricios currently listed at $63,500.

Emerging: Rooftop view from a 3-room apartment in Parque Patricios currently listed at $63,500.

When looking for residential real estate opportunities, many porteños and foreign investors have historically focused on three of the wealthiest and most densely-populated neighborhoods in Buenos Aires: Belgrano, Palermo and Barrio Norte. And while outside interest and new project development in these three barrios continues unabated, local studies suggest some smaller, grittier neighborhoods are emerging as potentially more attractive investment alternatives. CIBA, the Real Estate Chamber of Buenos Aires Province, reports that three BA barrios—once considered only marginal—are actually offering better returns for some real estate investors. In calculating ROI, the study focused on the ratio of average annual rental income (that a buyer could anticipate) to average purchase price for an existing three-room property in good condition. Based on this criteria, the Top 3 neighborhoods in Capital Federal were Parque Patricios (6.10%), La Boca (5.95%) and Congreso (5.93%). The numbers highlight the affordability of units in these lesser-known areas according to local broker Luis Ramos of L.J. Ramos: “Today, in general, it’s more convenient to purchase real estate located in areas that aren’t so coveted, because the rental rate differential isn’t so great to make you think you could make significantly more income in one neighborhood over another.” In addition to offering the greatest ROI in this study, the Parque Patricios neighborhood is home to the City of Buenos Aires Technology District which seeks to create 30,000 new jobs by 2012. For more information about investment opportunities in these and other Buenos Aires neighborhoods, send your inquiry to in@investba.com.

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The Word Is Out on BA’s “Wonderfulness”

On February 17, 2010, In lifestyle, tourism, wine & vineyards, by InvestBA
Wine critic Matt Kramer writes of the "wonderfulness" of BA. (Pictured: Soberbia 22 in Palermo)

Wine critic Matt Kramer writes of the "wonderfulness" of Buenos Aires. (Pictured: Soberbia 22 in Palermo)

American wine critic and Wine Spectator contributing editor Matt Kramer arrives in Buenos Aires for a three-month stay and wastes little time getting to know the food & wine delights of his newly adopted barrio of Palermo Soho. Kramer authored several Making Sense of Wine books and coined a term “somewhereness” in describing a wine’s character.  Prior to his departure, Kramer—a seasoned globetrotter—says none of his friends or family members ever asked him,Why Argentina? “Apparently, the word is out on the wonderfulness of Argentina as a place and the Argentines as a people,” Kramer surmises, “And, let’s be honest, the word is also out about how wonderfully inexpensive Argentina is for those of us trading woebegone American bucks for even more economically bedraggled Argentine pesos.” In describing what makes BA unique, Kramer points to the “intactness” of the city and a true feeling of identity in the city’s many diverse neighborhoods. In his own neighborhood of Palermo Soho, Kramer praises the diversity of culinary offerings: “Around the corner from us is a Moroccan restaurant. Italian restaurants abound. And, surprisingly, there are a fair number of sushi places.” So for at least one veteran critic in Buenos Aires, it seems “somewhereness” has truly given way to “wonderfulness.” ¡Buen provecho! (Full Wine Spectator article)

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