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Real Estate Showdown: Buenos Aires vs. Uruguay Beaches

On September 1, 2010, In foreign investment, tourism, uruguay, by InvestBA
Rock Em Sock Em Robots

Stay in BA or follow the Path to Punta? Argentines and foreign buyers alike are asking the question.

More Argentines are crossing the river to invest in Uruguay real estate. While this headline from Mirador Nacional (MN) highlights the obvious, it also digs deeper with a cost per square foot comparison of Uruguay destinations with some of Buenos Aires’ most expensive neighborhoods.

But first, MN points to the oft-cited $1.5 billion in Uruguay closings over the past 18 months number and breaks it down by region: $700 million in Punta del Este, $120 million in Jose Ignacio & Garzon and $40 million in La Barra. And while an estimated 60% of Punta del Este buyers are from Argentina, the remaining 40% is a rich cultural mix from Brazil, Canada, Chile, the E.U. and increasingly the United States.

Financial, legal and political stability are three factors in Uruguay’s favor as are competitive real estate prices. The average new construction cost in Punta del Este is $288/SF which compares favorably with $250/SF in Las Canitas, $278/SF in Palermo Soho, $325/SF in Recoleta and $342/SF in Puerto Madero, according to Reporte Inmobiliario.

Recent sales in Punta del Este include a 2/2 apartment in La Mansa for $341,000, a 3/2 in La Brava for $286,000 and a furnished 2/2 on Roosevelt Avenue for $245,000. Still, the comments section of the article reveals Punta del Este isn’t for everyone. “Why invest in a place that is only active one month each year?,” writes Lucia, and Carolina opines,“It’s too small and stressful in summertime.” For these ladies, emerging destinos uruguayos like Punta Colorada, San Francisco or Playa Verde might be a better fit. (Full article in Spanish)

For more news and information on local real estate markets, search our archives and download the new edition of InvestBA Privada.

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Argentina Real Estate Buyers Seek Sunshine State Bargains

On July 29, 2010, In foreign investment, real estate, by InvestBA
Watercolors

Argentine buyers are choosing Florida condos and townhouse projects like this for a variety of reasons.

Back during the go-go days of the Florida real estate boom, many Latin American cable subscribers were bombarded with round-the-clock programming and cheesy infomercials like Viva Florida pumping the you-must-buy-now-deal-of-the-century-luxury-lifestyle-and-resort-style-amenities in high-rise towers and gated communities throughout Central and South Florida.

When the market began to implode in 2007, many of those foreign buyers who reserved units got burned and either walked away from their deposits or took possession of units that lost anywhere from 30-80% of their value from the market peak in 2006.

Fast forward to today and Florida Trend says developers of high profile towers like Icon Brickell and Everglades on the Bay are now turning over thousands of unsold units to their lenders. Yet despite the market turmoil and the average U.S. buyer’s reluctance to jump back into the pool of real estate speculation, media sources say Argentinean buyers are doing their market research and coming to the Sunshine State in search of great deals on Florida real estate.

ElArgentino.com says most Argentineans still gravitate toward condominium investments: some in search of rental income, others seeking portfolio diversification and still others doing long-term planning in hopes their children will eventually study in the U.S. But condos aren’t the only properties attracting el inversor argentino in Florida. The report says Argentinean investors are now carefully weighing everything from townhouses to residential buildings with 4 or more units to small shopping centers and other commercial properties.

With improving sales figures and some recent indications of price stability, the prospects may ultimately be brighter for those argentinos who waited. For more information regarding Florida real estate opportunities, contact us directly.

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Hogar Dulce Hogar: Buenos Aires Homes Holding 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 channel centers on apartments and condominiums, La Nacion 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 porteno homeowners don’t want to be sandwiched between high-rises. For that reason, areas like Almagro, Villa Crespo and Barrio Ingles where high-rise construction is prohibited are gaining in popularity, as are house-centric barrios like Villa Pueyrredon and Villa Urquiza which we 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 Nacion 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. (Full Story in Spanish)

For more information on BA real estate opportunities, download IncomeBA and the new issue of InvestBA Privada.

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Recuperacion: Buenos Aires Real Estate Showing Strength

On July 13, 2010, In foreign investment, real estate, by InvestBA
Puerto Madero Construction

Back from the depths of 2009, BA's real estate sector posted a 41% gain in transactions in May.

A story we’ve monitored closely since the end of last year is the recovery of the BA real estate sector. After an abysmal 2009, December finally offered a positive note; a trend that continued during the first four months of this year.

Now the newly-released housing data for May suggest BA’s property rebound is in full swing. According to the BA Notary Association, the sale of properties jumped 41% in May compared to a year ago, while the value of all real estate transactions rose 91%.

Cronista says the second statistic reflects the large number of buyers taking delivery of high-end units that have been under construction for the last 2-3 years. The 5,165 real estate transactions in May were valued at 1.908 billion pesos argentinos or US$484.82 million.

While local analysts say signs of a recovery abound, it’s worth remembering the year-over-year basis of comparison: the first six months of 2009 was one of the worst periods for BA real estate. As the global financial crisis gathered steam, confidence was shattered and buyers were scarce in the Southern Cone. Now a year later, a rare global commodity has returned to Argentina and Uruguay: optimism.

The May housing numbers show units priced between US$60,000 and US$220,000 accounted for 38% of all sales, while units priced below $60,000 represented 56% of all transactions. The sale of units priced above US$220,000 doubled from 3% last May to 6% in May 2010. (Full Story in Spanish)

For more information about Buenos Aires investment opportunities, download Income BA and the new issue of InvestBA Privada.

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Mythbusters: Puerto Madero Edition

On June 30, 2010, In foreign investment, real estate, by InvestBA
Puerto Madero high-rises and buyer preferences

Leyenda Urbana: La Nacion debunks the Top 10 Myths about the Puerto Madero neighborhood.

PuertoMadero is a favorite real estate topic on InvestBA for a variety of reasons. Superlatives make for interesting reading, and Puerto Madero (PM) has certainly generated its fair share since incorporation and waterfront transformation commenced in November 1989. La Nacion throws a skeptical eye at those superlatives and culls the Top 10 Myths about Puerto Madero.

#1.) It’s the youngest neighborhood to be incorporated in BA. False. Parque Chas in December 2005.

#2.) It’s the most expensive BA neighborhood per square meter (sqm). Debatable. While PM units sell for an average of $3,800/sqm and some towers fetch $6,000/sqm, the average sales price in Barrio Parque is $4,750/sqm.

#3.) Units with river views command higher prices than city views. False. Most owners surveyed return from the office at dark and would rather look at La City than La Plata Oscura.

#4.) There are more offices than residential units.  False. While true initially, that trend began to reverse in 2005 and today the number of residential sqm (1.303MM) is practically double the amount of office space (659K).

#5.) Foreign buyers own the majority of new high-rise units. False. 70% of the buyers are still Argentines, although that is changing as more Europeans shift funds out of the battered Euro-zone and more Americans discover the quality of life and cost advantages of living in Buenos Aires, Argentina and Uruguay.

For more information about investment opportunities in Buenos Aires, download IncomeBA and the new issue of InvestBA Privada.

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