| Author | Message | ||
     Roberto Board Administrator Username: Admin Post Number: 30 Registered: 12-2004 |
Post your real estate ideas or experiences here. Many lurkers read this forum and will benefit from your knowledge. | ||
| Apartmentsba.com New member Username: Saint Post Number: 8 Registered: 5-2005 |
Roberto, I applaud you for starting this section. I got started in real estate here shortly after the crash. If I could have changed one thing in my life it would be to have gone with my desire to start purchasing real estate immediately following the crash. I waited over a year for things to stabilize and I'm glad I started buying properties. Although property prices have gone up since the devaluation I believe there is a lot of room for growth if you are buying in the right areas and are not overpaying for the property. I strongly believe that years down the road, those that purchased property here as an investment will feel fortunate to have purchased here. Many investments are risky in Argentina but I feel real estate is one of the safest plays and I'm very happy that I decided to jump in. Time will tell who is right or wrong but these message boards will be around for a long time so we'll see who made the right call. Good luck to all. | ||
| Roberto Unregistered guest |
> start purchasing real estate immediately following the crash. hehe.. I thought it could be one of those rare opportunities too. Once in a lifetime, so to speak. But like it happened with the vast majority of argentines I got caught in the downfall and money was scarce. The average guy had to sell assets actually. Yeah, I know. That is the reason why prices were rock bottom. I agree with you. The recovery of real estate prices after the colossal debacle is a testimony of how good an investment this could be. | ||
| Apartmentsba.com New member Username: Saint Post Number: 9 Registered: 5-2005 |
Exactly. Most people don't realize that property purchases are 100% in cash. When I say cash I mean it literally. No one trusts bank wire transfers or checks here. It's ALL cash. I just bought a house a few weeks ago for u$s 400,000 for a client. It was all in cash and they counted every single $100 bill. They won't even allow electronic money counters. They want to feel and inspect each and every bill. They will hand you back bills that have a mark or handwriting on them. It's comical. I was here when all the banks closed and people couldn't withdraw their money. I felt horrible for these locals. Imagine if the same thing happened in the USA. These nuts would be blowing up banks. People here for the most part were very civil simply banging on pots and pans. Imagine if the banks in the USA wouldn't allow you to take out ANY money for months. It would be chaos. That is exactly why many people were selling to sell at firesale prices. They simply needed cash. I still wish I bought during this time but part of me would have felt like I was preying on people in a bad situation. I honestly feel that if you buy in the right areas here for the right kinds of property, your money will be as safe as cash sitting in the bank. I have properties I bought last year for $100,000 that I'm getting offers of $160,000 now. Simply amazing. Good luck all. | ||
| Roberto Unregistered guest |
> It's comical. Actually, it is not. This insignificant detail tells you a lot about us. Hidden behind a seemingly hilarious fact there are important lessons and alerts to pay attention to. I would not discard this valuable information. It may help you in the future. Yes, it would be chaos here now. But back in the days when Roosevelt confiscated all public gold I don't think it was. Remember, the crisis of a few years ago was enormous. The country defaulted. Even with a more logical and reasonable President, default was just around the corner. At present, there are some indications that Kirchner is more astute than what anyone ever envisioned. And that is, he knows how to make money... and keep it here, in argentine hands. Even with the perennial shadow of corruption behind him I feel he has done well for the country, in general. This may have been conducive to gain in confidence and, in turn, price appreciation. Those numbers that you are managing are quite good in terms of argentine values. I haven't heard of too many properties at close to half a mill. down there, whereas here in Miami a new apt 2 bedr. ocean front, 1700 sq feet (miami beach) would go for 1.5 mill And a 3 for 2.5 which leads me to believe bubbles may be popping everywhere. Are argentine prices escalating as fast as in some other regions (UK, pockets in the USA, etc) in your opinion? | ||
| Apartmentsba.com New member Username: Saint Post Number: 10 Registered: 5-2005 |
Hi Roberto. No, I don't discard it. I just find many ways of which business is done here primitive and I'm sure you will agree compared to the USA/UK. There are things I hate about my new country but the number of things I love about it are more than the things I don't like about it. Still, doing business here can be challenging. I agree with your thoughts of Kirchner. He is doing a great job IMHO. Actually, my partner's family was neighbors with him. He is from the South of Argentina. You are exactly correct. There are few properties here at $500,000+ Many of them are in Recoleta. On a stretch of Avenida Alvear where I live I have been inside many apartments while I was looking to buy. Many million dollar plus apartments on this posh street. The number of people that can afford that size property is few and far between so they take longer to sell. Most of the properties people are buying are under u$s 120,000. What I'm doing with rentals is the reason why the capital appreciation is so great. I compete against the hotels not other cheap apartments. People wanting to buy my apartments are buying them as a business, not just as real estate. The real estate alone on some of my apartments aren't worth what people are offering. However, as a business it is worth it. Look at http://www.apartmentsba.com/system/productos_detal le.php?id_prod=286 It doesn't take a rocket scientist to see what the potential rate of returns are like. No, Argentina prices are no where rising as fast as some areas of the USA and UK. Prices ARE rising but they are steadily. The reason for my extremely high offers is because I have turned each apartment I own/manage into a business. Hope that helps. | ||
| Roberto Unregistered guest |
> I compete against the hotels not other cheap apartments. I read it on the other thread. Way to go. Excellent idea. We do get requests for apartments as opposed to hotels, specially for stays longer than 2 weeks that may even include spanish lessons. Hotels can't compete with your offer. | ||
| Apartmentsba.com New member Username: Saint Post Number: 11 Registered: 5-2005 |
Hi Roberto, Thanks. Even on stays as little as 2 nights we are getting many many bookings. The reason is the good reputation of being dependable. All my employees speak English and meet our clients at their apartments upon arrival. I use a company that brings them to our apartments. They get a business card from the person checking them in. That person works sort of as a concierge during their stay if they have problems. Most of the properties I am buying for myself and my clients are in Recoleta close to where most of the nicer hotels are. Are properties are double or triple the size of hotel rooms, they have really high end furniture, high-speed Internet access, USA phone lines, free local cellphone included with the apartment, DVD, 30 inch flat screen TV, nice stereo. What's not to like? The hotels don't provide these things. The prices of hotels are going up very quickly with the boom in tourism. Some hotels have raised their prices 50% - 80% in the past year and there are no indications that tourism will slow down. Argentina, IMHO is only beginning to be discovered by many Americans and Europeans. People told me several years ago that my dream to build this kind of company was not doable. They told me there was no market. Instead of listening to them...I helped create the market. Build it and they will come so to speak. I continue to believe that property prices will continue to go up over the next decade. I also believe that more financing will be available in the future. I'm sure it will NEVER be like in the USA where anyone can get a loan and pay off their house/apartment for 30 years. It's a house of cards in the USA. Interest rates go up 1% and many people can't afford their house payments. I believe there are big problems about to take place in the USA. The stack of cards will fall and they will fall hard and fast. It will be a chain reaction. Consider that even if 50% mortgages come into the picture or really any type of mortgage, it will spur local buying. Time will tell who was right or wrong. I've posted on several public message boards since 2002. I have been dead on target on tourism, real estate and the exchange rate. We will see if my predictions prove to be correct on the real estate market here over the next several years. The great thing about public message boards is most are around for a long time so you can see if someone was on target or dead wrong. Add to the fact that the local utility companies can't really increase the utility prices too much. It makes owning property here very attractive. You can still buy some property in Recoleta for $1,300 per sq. meter. If you avoid areas like Puerto Madero where property is as high as $3,000 per sq. meter... I truly believe you can make some excellent returns over the next several years. Add to the fact that there are 0% capital gains taxes and only a 1.5% transfer tax when you sell and it becomes even more attractive. Good luck all. | ||
| Michael O Unregistered guest |
Hello, I just noticed this message board and coincidentally, I too am interested in purchasing a condo or house in Buenos Aires. I am especially looking at what the rental outlook would be for the tourism business. I am interested in learning more of course. I do like your position that your properties are attracting tourists because your rooms are much more accommadating. I can use your advise on this matter. | ||
| Apartmentsba.com New member Username: Saint Post Number: 22 Registered: 5-2005 |
Michael, You can feel free to email me if you want. mike@apartmentsba.com I have taken the time to post very detailed information on buying real estate as an investment in Buenos Aires on my website. My pace for buying has stepped up for my clients. I was being hired on average 1 time per week. Last week I was retained by 5 people and I see no slowdown in sight. The investment community is discovering what I did a few years ago. That real estate is a stable play here. When you couple it with the tourism industry the returns can be really amazing. Tourism is skyrocketing in Argentina and I don't think there is any slowdown in the near future. I think the world is only starting to really discover Argentina as a tourist destination. Consider that 20% of our business is also corporations and we began to market to cosmetic surgery patients that are coming down in droves because of the high quality medical care and the excellent physicians. Really my business plan isn't rocket science. I'm buying in the same areas as most of the 4 and 5 star hotels. It's no fluke they are all in the same area. Then my apartments are 2 to 4 times the size as the average small hotel room. We put in high quality furniture, lighting, bedding, mattresses, etc. Then the best part is that it's often 1/3 or 1/2 the price of an expensive hotel. Consider that now I see some hotels like the MGM Grand Las Vegas following my lead. They are building the first ever condo/apartment-hotel on the Las Vegas Strip. They are starting to build these in Miami and other big cities. The world is discovering that apartments are a viable alternative to a small hotel room. Granted some people will always go to a hotel but savoy travelers that demand free local lines, cellphones, USA phone lines, high-speed wireless networking, luxury furniture, etc. I think this is only the beginning. This business can work anywhere there are expensive hotel rooms. I just sold my franchise to Rio de Janerio where I think it has just as good potential and I'm in the midst of finalizing the franchise for Costa Rica. BA is a special place though and I think real estate here will be solid the next decade. My posting about mortgages coming into the picture was spot on. I am now starting to see 50% mortgages here. Once they are mainstream, property demand will skyrocket. Guess what it will do for property prices? | ||
| londonmuppet Unregistered guest |
as a Brit and IMHO... Michael you have a sound business plan that obviously works and is sucessful.. you aim to provide equal or better accommodation for less money than staying in 4/5 star hotels. Marketing must be a problem though when competing with hotels. How do you encourage them to use you as opposed to staying in a Hotel? You must know your customers really well. Is this not a bit of a niche market? | ||
| Apartmentsba.com New member Username: Saint Post Number: 25 Registered: 5-2005 |
Hi Londonmuppet, Yes, the business plan is sound and has been going well since I started the company in 2002. I didn't get really serious about it until 2004 when I left my executive career and sold my house, cars, etc. to move to Buenos Aires full-time and started purchasing properties. The business is solid and as you mentioned, we simply have a better product for the money than 4/5 star hotels. Granted there will always be a segment of the population that has to stay in hotels but people are becoming more independent around the world when traveling. My staff also makes it very easy meeting them at the apartment at the check-in/out and they ALL speak English. Marketing is not too big of a problem. I advertise on vacation rental websites like VRBO.com and also on Google. Also, prominent books like Lonely Planet have listed us in their 2005 Buenos Aires Guide. Marketing like that is something u$s million couldn't buy. You can't "buy" your way into a travel book like that. Also, HGTV flew here a few weeks ago to do a special show on my company and also E! TV has contacted us about doing a special show. This IS a niche market but when you think about it, tourism will explode even further here in the next several years. Argentina isn't the "secret" it was the past few years. Our product sells itself with higher end amenities that the hotels don't offer. Free local phone calls, free local cell phones, Wi-Fi high speed Internet access, USA phone lines in the apartment, 2 to 3 times the space of a hotel room at a fraction of the price. Flat screen big TV's up to 36 inches, DVD players, high end luxury furniture and lighting. We are starting to go higher and higher end on our apartments because I found that people are willing to pay more for a better product. Our most requested apartments are those that we spent more money on. There is no secret to my business plan. In fact, I pretty much spelled it out on my website (www.apartmentsba.com) . The thing is that it takes a lot of money to do what I'm doing. Property purchases are ALL cash (literally) with no financing available for the most part. Renovations, high end furniture all costs money. We are averaging now u$s 25,000 - $30,000 in furniture/bedding/lighting/electronics alone on each property purchase. Hotels and other apartment owners simply refuse to do that. I have apartments like AP1 on my website. I bought that apartment for $130,000 and we are spending a whopping $37,000 on renovations and another $20,000 on furniture. But it will be a penthouse apartment on the 8th and 9th floors with 3 bedrooms. We are charging $200 a night and it is already booked for next year with NO photos. Just the description and reputation of my company alone. $200 a night won't get you a really good suite at the Four Seasons or even the Loi Suites Recoleta these days. This apartment will sleep up to 6 people (1 King bed, 1 queen bed and 2 twin beds). 3 cellphones included with the apartment, wi-fi high speed internet access, high end furniture, everything new. If you have 6 people that is only $33 per night per person. If they tried booking 3 rooms at a high end hotel it would be at least $700 per night. Everyone wins. My client will NET an estimated 13%-15% per year on his total investment, our clients get a first class property at a fraction of the cost of a high end hotel. What I'm doing isn't rocket science. It just took a lot of guts to move down here and get organized and make a serious business out of it. My idea about franchising was just sort of an idea but Rio de Janerio is sold and that owner is already making money (www.apartmentsrio.com) I just sold www.apartmentscostarica.com . I'm negotiating terms for apartmentscuba.com as well as the Amsterdam franchise. The best thing that investors like is what I'm doing is not specultation. I have a working model that works. | ||
| rcpiper Unregistered guest |
Saint - Impressive plan and congratulations on making it work. We are looking for RE investment in South America but would like it to be in an area we would actually like to live for a while. Recommendations? Thanks! | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 30 Registered: 5-2005 |
Hi RCPiper, Thanks for that nice post and for the congratulations. I'm really gratified that everything is working out. Many times the locals tell me that I have luck on my side. Then I laugh and tell them it really had nothing to do with luck. I left a wonderful life in the USA, sold my house and cars, cashed out most of my 401k to do what I'm doing. I work about 16 hours a day. Ha, ha. I guess a bit of luck as well but mostly hard work, long hours and a lot of investment capital. The answer to your question really depends on many factors. Are you mainly buying as an investment or mainly to use as a residence. The biggest mistake many make is they buy with their heart instead of with their head. I posted a good bit about that on my website so you can read about it if you're interested. It's on my website under my consulting section. I have traveled throughout South America to most countries. Honestly, I'm living in what I feel is the best city in South America. Buenos Aires is one of the most cosmopolitan cities with a high quality of life. There are few cities in South America that can offer all the amenities that BA can. Again, ask yourself what things do you enjoy. The beach? What is your definition of "a while"? Many cities in South America the costs involved with buying are high when you factor in realtors, lawyers, money transfer firms, etc. it's not wise to try to "flip" a property unless you will be there for a while. Where I would live is much different probably than where you would want to live so take some time and explain what it is you enjoy. If you enjoy the beach then of course you wouldn't like Buenos Aires. Places that come to mind would be places like Punta del Este, Uruguay. I flew there to look at real estate. They have some of the nicest properties of anywhere i have been in South America. I almost bought an apartment there. The problem was that I looked at the market and it's a VERY seasonal town. It's really only utilized 2 months out of the year (end of December till end of February). Still, with rentals just those 2 months you can make 6% returns on your investment so still worthwhile but why do that when I can make almost 20% returns renting in Buenos Aires?? You really need to study the market of where you are buying. Don't rush into anything. Generally ask yourself if you would act this way in your home country. Never act in a way or do something that you wouldn't do in your home country. Take purchase price out of the equation. Would you do things like use a lawyer that spoke no English in the USA/UK that you communicate with? Would you do things like wire money into an account of a person you knew nothing about or had no references for? Exactly! So don't make the same mistake in South America. On ALL cash transactions there are NO room for mistakes. Buying real estate in South America has many factors. Real estate is much much cheaper than the USA/UK/Europe so people somehow get mezmorized into thinking it would be "fun" to buy here. However, you really need to look at the numbers to see if it makes sense for you. In many countries around the world there is financing and mortgages. Here it's cash on the table so it's a different world than what most people are use to. Good luck. | ||
| franco francisco New member Username: Francisco Post Number: 1 Registered: 9-2005 |
Roberto, Hello, i am new to this board and am going to be in argentina in a few months. I was wondering if there is anyone in particular that you use as far as real estate and legal advice is concerned? I am propbably going to be investing in the country. So any advice would be greatly appreciated. Gracias F_Francisco | ||
| Roberto Board Administrator Username: Admin Post Number: 142 Registered: 12-2004 |
Welcome, Franco! On a personal basis I have lifelong argentine friends who are involved in real estate and I usually consult with them. However, I am under the impression that you are looking for a more professional type of service in which case you should do some serious DD, specially when it comes to buying anything in Argentina. A good start is this same forum. Several of our members, such as "Saint/Apartmentsba.com", seem to have extensive experience in this field. You can read our threads and that will give you an indication of where some guys are standing. Every now and then they participate and you will have a chance to interact... There are links to their websites that you can explore as well. Besides this, there are some reputable, large real estate offices in Buenos Aires that can provide you with useful advice too. Whatever you do you, I'd suggest that you explore two or three different venues. | ||
| Langdon Doty Unregistered guest |
Hi, I want to buy a modest 40-50 acre vineyard in mendoza argentina. i've seen prices ranging from 100-250K. I have several friends who will join with me so coming up with at least 100K will not be a problem. we want a place that makes an income through grape, olive, fruit sales every year which would serve as a haven away from NY. Are there any reputable real estate agents you could recommend in the mendoza region who could help us. i will be in that area around early december to check out properties. thanks | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 31 Registered: 5-2005 |
Thanks Roberto for the forum. I have helped several investors from around the world. I can honestly say none of them NETTED less than 12% last year on the rental income and capital appreciation was at least 20%. We don't promise any returns but I think you can look at the business model for real estate here and see it's one of the safest plays in investment here. Anyone buying here just make sure you know and understand the laws, you use good realtors and excellent attorneys. This isn't the USA/UK and the industry is severely unregulated so you can get cheated easily. Langdon Doty - Prices range all across the board on property. Just keep in mind that that type of investment has a lot of inherit risk. Also, if it's a new property and not existing crops you are at least at the very minimum 3-4 years from your first harvest. I know a lot of people that thought it would "be fun buying a vineyard" and they got burned. A lot of variables with weather, crops, etc. Good luck. | ||
| Langdon Doty Unregistered guest |
Thanks for responding so quickly. Our strategy is NOT to rely on rental income initially, but income from the farm, which these listings claim are from 40-80K per year selling the grapes, olives, fruits, etc, depending on the cultivation. This income stream can be improved by one of our investors, a lawyer/sommelier and wants to start his own label, rather than just selling the grapes to local producers. Eventually we would offer cabana rentals on the property as it is in a heavy tourist area, close to skiing, etc. I've checked your site (impressive) and wonder if you've had people approach you for these "vineyard ploys" incorporating rentals and having farm income as a viable income stream as well. | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 32 Registered: 5-2005 |
Hi Langdon, Great. As long as you have a realistic expectation. I have talked to several investors that had dreams of starting "their own labels". Keep in mind that there is a lot of competition and people that know the business inside and out so you are competing with that type of system. Also, the system of business here in Argentina is extremely corrupt. (http://www.transparency.org/cpi/2004/cpi2004.en.html#cpi2004) I can't emphasize this enough. Most Americans that move here or started businesses here can't adjust and pack up and go back to the USA. I would take any "listings" with a big grain of salt. A big part of the equation should be "depending on the cultivation". The rentals could be a good option depending on the location and how you geared it. I have been approached for a Mendoza franchise by a local Porteno but I prefer to sell these franchises to Americans/Europeans that I think will build up the business. Luxury rental properties throughout Argentina would work well. I stayed in Mendoza and stayed at the Park Hyatt Hotel. I paid about $275 a night. It was great but they charged me u$s 13 a night or so for high speed Internet. Luxury property rentals around the world are becoming more popular. You might want to strongly consider the "Cabana rentals" option. The cost of labor is cheap and you can find dependable bilingual staff for not a lot of money. I have had a lot of investors that flew to Mendoza to look at vineyard ploys but most have walked away when they looked closely at the numbers. I recommend you really dig deeply and look at the numbers or make a formal business plan before proceeding. The biggest problem with investors in Argentina is often times they look at the cheap price of property/land and it changes their common sense. Typically ask yourself if you would do the same thing in the USA or UK or wherever you are from. Would you use a lawyer that you couldn't speak English with?? Would you use a realtor you couldn't communicate with? Would you wire funds into a bank or person you don't know anything about? Remember deals here are all cash and there is no room for mistakes. Email me if you want and I'll try to research reputable realtors and lawyers in Mendoza for you. Good luck. mike@apartmentsba.com | ||
| Vladimir Unregistered guest |
Re: Foreign Exchange of Argentine Pesos Hi everyone! I am thinking of buying a business in BA that has real estate. How do you convert Pesos to Dollars? Any suggestions would be great! | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 33 Registered: 5-2005 |
There are several money exchange places that can accomodate a transfer. Just make sure you use a reputable company/bank as there are a lot of conterfeit bills floating out there. There are a ton of places on Corrientes near San Martin. Traditional banks usually have bad exchange rates. Walk along Corrientes and San Martin and look for the one that offers the best exchange rate. Then if it's a big transaction they might give you an even better rate. If you are buying a business or real estate, most likely it's in u$s. The majority of people buying go through a "Private bank" to avoid conversion fees. Most charge around 1%-1.5% of the total amount you are transferring. That usually is the cheapest method. You should note there is NO free way to get u$s into Argentina other than carrying it on a plane and not declaring it which I do NOT recommend for obvious safety reasons. ALL u$s coming into Argentina is legally converted to pesos (at a horrible exchange rate) but since property is priced in u$S it's converted back to u$S at a bad rate. There are a few banks that can do it for a decent rate but the amount of paperwork can be extreme. The easiest method although not totally "white" is to use a private bank or money exchange place that will simply charge a flat %. Good luck. | ||
| Roberto Board Administrator Username: Admin Post Number: 150 Registered: 12-2004 |
Or have a connection, as it is always the case. A few more points, adding to what Michael just said. On changing your money NEVER pay attention to the guys on the street whispering "cambio, cambio". This is high risk. Not because you will get your money stolen but possibly because you may get counterfeit bills or a poor rate of exchange. It won't be hard to find a reputable currency exchange office. Many real estate transactions also ocurr abroad (the accounting, of course) as most argentines and institutions have accounts in foreign banks. This may mean as close as Montevideo, Uruguay. So even if you find it difficult to finance a real estate purchase in greenbacks, you can still 'exchange' your dollars abroad for an argentine asset. For daily rates of exchange you can always check our currency converter | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 34 Registered: 5-2005 |
Yep...connections are always great. I'm sure you can email Roberto and he or his family members have people they can recommend. I NEVER intended people to go to cambio cambio guys. There are legit banks/companies in the area I mentioned. Listen to Roberto. NEVER change money with people on the street. Never! The number of transactions occuring aboad is VERY VERY low. I know. I'm buying about 1-2 per week now. Most Argentines, even if they have banks aboad want cash. It's getting more difficult for them to transfer funds back to Argentina as the government believe it or not makes it not so easy for them. A tremendous amount of local money went to offshore banks in Uruguay, USA, Europe after the crash. Most locals don't pay taxes or cheat on their taxes so now the government wants to see all these people that are replenishing their accounts here from abroad. You will find most want CASH to close on property with no bank wires outside of Argentina. Cash is king. Most people are surprised that literally cash is used at closings. It's quite a site to see. | ||
| Roberto Board Administrator Username: Admin Post Number: 151 Registered: 12-2004 |
Ha! When is Kirchner taking the lead and bringing back his Santa Cruz' USD 500 million he sent to a Swiss bank during the debacle? But that's OT, sorry. | ||
| marcello Unregistered guest |
Hello! I happen to have in Tenerife (Canary Is.), since 2003, a similar business Saint has (www.exxostenerife.com). I wanted to ask you all what do you think about investing in Cordoba city... I think it's mostly a student's city, but also some big multinational companies are doing business there, so what kind of investment would you advice, if any? Thanks in advance. | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 35 Registered: 5-2005 |
Hi Marcello, Just my opinion but I would stick to other areas of Argentina that has more tourists. This is just my opinion. There are so many cities around Argentina that are experiencing huge amounts of tourism and Cordoba doesn't get so many compared to other cities. In fact, most of the people I know from Cordoba bought real estate in Buenos Aires. It's a safer play and easier to unload when they want to cash out. I assume when you're talking about "investment" you are talking about real estate since this is the real estate section. Most of the major construction is geared towards the wealthy or foreigners. Here is an interesting article that came out yesterday on Reuters. http://www.thedailyjournalonline.com/article.asp?C ategoryId=12394&ArticleId=199657 Still, if you are dead set on investing in Cordoba maybe a hostel or something like that could work. Good luck. | ||
| marcello Unregistered guest |
Hello Saint! Thanks for the very revealing article, which leads to another interesting source of information (www.reporteinmobiliario.com). Your assumtion was correct, as "investment" I meant real estate... but not holiday/short term lets. Being in the tourism industry for almost 20 years, I tend to care very much about customer satisfaction, and since I don't intend to move there permanently, I would never have a business like yours if I'm not able to oversee it on a dayly basis. Besides, I don't have THAT MUCH cash, so my idea was residential/students rental income, long term. That's why I was asking about Cordoba, but if you think something like that is preferable and easier in Buenos Aires or somewhere else, I'd like to have you opinion... Thanks again! | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 38 Registered: 5-2005 |
Hi Marcello, I don't just believe "real estate" is a wise investment for holiday/short-term rentals. I have many, many, many clients that are purchasing real estate here simply to buy and hold or buy and flip in a few years. So far, I haven't been wrong on the real estate market here and I have invested quite a substancial amount of my own money in the real estate market in Buenos Aires. I'll continue to purchase here. Keep in mind that many people are buying real estate here not only for my business model but also because they realize that BA is a world class city and property here is undervalued. There is no other serious form of investment here in Argentina that is stable. Real estate is the safest play for most locals and foreigners. I'm not saying real estate isn't a good investment in Cordoba. Honestly, I don't know the market in Cordoba. My point is that I met many people from Cordoba and they are very savoy individuals that have done well in their respective fields. They aren't buying real estate in Cordoba (and they live there). They are buying real estate in Buenos Aires. As an investor I look at all possible trends and directions of the market. All my properties have appreciated substancially in value and I see that trend continuing over the next several years. Real estate prices just surpassed where they left off before the crash only in February 2005. I truly believe there is a lot more upside potential. Property in Buenos Aires I believe will be much easier to unload when you are ready to sell vs. in Cordoba. There is always a time to buy and there will be a time to sell in the future. I see a lot more years of upward potential but there will be a time to sell and I'll be there selling hopefully dozens of personal properties. Best of luck to you in your investments and your personal life. Mike | ||
| Billabongchick Unregistered guest |
Hello, looking for some advice on buying a small farm/ranch style property about a max of 1 1/2 hr from BA. We want to buy some horses and tap into holidays doing trail riding/polo/tennis etc combined with day trips to BA. It would need to have at least 10 acres of land for horse pasture. We also want some kind of alternative income generated from fruit/cattle etc. From reading the postings on this site it looks as if the whole wine thing is a little precarious to get into so was wondering if anybody has any advice or good ideas? I have personally stayed out near Belgrano / Monte a few times and this was to me a great place for riding and a comfortable distance from the airport but I know little about farming income in this area. Is around $300,000 realistic to get somewhere like this with a main house and chalets or farm buildings that could be converted into guest lodges? Ideally we would like to spend more like $200,000 to enable some money to update/renovate. How much would you expect to pay a caretaker family if you give them lodgings (ie, a groom or stockman and a wife who could cook/clean for guests?) Also is it still not possible for non Nationals to get a mortgage or loan towards cost of property? What would you pay in taxes each year? And any other monthly/yearly costs that would need to be taken into account for a ranch property? Any advice appreciated!! | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 41 Registered: 5-2005 |
Hi Billabongchick, I don't know too much about farms. I specialize in Buenos Aires but I do know that land outside of Buenos Aires is much much cheaper. 1.5 hours away you should be able to get something very affordable. I know someone that bought some land and an old house and they paid only u$s 50,000. She was using it for her polo horses. Many properties outside of the Capital are priced in pesos instead of u$s like all the properties in the Capital. I don't know anything about income from farming, fruit farming, etc. $300,000 should buy something very very nice. Salaries here are very low. That far out and it should be even lower. If you are letting them live there too that should make things even cheaper. An average maid here makes 6 pesos per hour or 700 pesos per month (u$s 233). I pay mine 900 pesos a month (u$s 300) and that is considered very good for BA maid standards. She cleans my house everyday, does my grocery shopping and takes clothes to the laundry, irons my clothes, etc. I also own many properties which she helps clean. She works Monday - Friday about 9 hours per day. Needless to say, you should be able to get someone very affordable. The cook/maid probably about 700 pesos per month or less (u$s 233) and the main caretaker maybe around 1,000 pesos a month (u$s 333). Of course if you want someone educated or bilingual the salary will be more expensive. It's almost impossible for foreigners to get mortgages here. 100% cash. I do have clients that got home equity lines of credit in the USA/UK at low % rates and then buy here. Mortgages here are new and the terms are 12% interest per year, 50% down over 10 year maximum. Also, you have to have a really good job to get a mortgage here. Good luck! | ||
| Billabongchick Unregistered guest |
Great- thanks for the advice- I didn't know that prices would drop so dramatically even only 1 1/2 hrs from BA. The roads seem fairly good in the area I would be interested in so it will be interesting to do some house hunting and pricing if we can get out there in November. One other question; what sort of temperatures can you expect in the coldest winter months? Have only been out in summer months! Thanks! | ||
| Donnie B Unregistered guest |
I am interested in real estate in Argentina and have some concerns. From my preliminary research I understand the following is true: - Argentine Peso used to be about 1 US dollar - now the Peso is worth about a third remains weak - real estate is transacted in US dollars and therefore the prices did not suffer (relatively) When I started this research, I was hoping for this scenario: - a big drop in real esate prices in Peso -> a big drop in valuation of Peso. If this scenario was to happen then buying power for the dollar would have been enormous for the real estate and once real estate and peso rebounded to the pre-bankrupcy level, BINGO I've made a fortune. This is almost what happened to South Korea in 1997. This leads to my question: I hear optimism in Argentina's real estate market largely based on increased tourism putting some other insignificant things aside. Coming from a real estate background, I know that longterm real estate market has to be supported by the domestic demand but if people are still getting paid in pesos that have devalued substantially and houses are priced in US dollars that seem to be going up. Seems to me that it's matter of time the demands fall short because of affordability and pressure will come down on real estate. I have done very well investing in other countries in post-bankrupcy situations; took an advantage. And I'm sure Argentina is a beautiful, nice weather, beautiful girls type of country. But the advantages that are usually available in post-bankrupcy country do not exist in Argentina, in my opinion. Furthermore, sometime in the future the gap between average income and housing affordability has to be reduced. Those are my two cents. Please let me know if I am wrong or if you have any opinions. Thank you. | ||
| Roberto Board Administrator Username: Admin Post Number: 272 Registered: 12-2004 |
Donnie, you may be overlooking a few things in your analysis. Plenty of argentines have accumulated savings in dollars due to the country's instability. Thus, real estate price appreciation may not end up affecting demand as much as your scenario proposes... even if salaries remain low. Furthermore, many have kept their savings abroad and have these funds at their disposal should the right opportunity comes along. As for post-bankruptcy situations it might be a good idea to consider that Argentina has grown an average of 8/9% per year in the last three years and is about to repeat this performance in 2006, so the days of bargains are long gone. Prices may still look *very* cheap when compared to pocket bubbles in the US (San Diego, San Fransisco, NY, etc) or the UK. In my humble opinion the key to real estate investment in Argentina does not lie in a potential price differential as in post-bankruptcy situations but in finding a business model -real estate based- that will allow for long term profits. A perfect example is Michael's business model (apartmentsba.com) which is isolated from potential disruptions in the economy and targets a very particular segment. His model may also benefit from price appreciation but in my view that is just the icing on the cake. In Argentina, what you really want is to find those niches that can provide you with a good degree of protection should things take a turn. Remember, starting on 2006 the government has moved further to the left by placing more of their 'montoneros' base in key positions of power. There are no immediate risks and Argentina still offers great potential in the mid-term. But you should always look further down the road here. | ||
| Apartmentsba.com Junior Member Username: Saint Post Number: 42 Registered: 5-2005 |
Roberto is 100% correct (as usual). Things here aren't as black and white as they appear. You have to understand the reasons why real estate took such a dive after the devaluation. Properties have always been priced in dollars. But what would happen in the USA if the banks closed for months, wouldn't let you take money out of the banks and oh yeah...your savings were worth 30% of what you had in the bank. Exactly, buying would stop and people would be selling to raise cash. The price decreases was artificial and they have only recently passed the pre-devaluation levels. As Roberto correctly pointed out - many, many, many affluent locals got a call the night or two before the crash warning them to withdraw all their money. I know dozens and dozens of people in this situation. Consider that there are hundreds of millions of dollars and more on the sidelines still from locals with their cash stashed overseas. I am one of the biggest buyers of residential real estate in Buenos Aires. I still see much upside potential as I correctly called in 2002. Every investment has a time to buy and a time to sell. I'm not saying real estate will always be a buy. There will come a time when real estate will be time to sell and those that bought at the right time will be rewarded many times over. I believe that to be the case here as well. There WILL be a time to sell and when that comes I'll start unloading. I still see many more years of upward appreciation. There simply are no other investments in Argentina that are safe besides real estate. Also remember that EVENTUALLY traditional mortgages will be offered here. I'm not saying it will happen |
