Investors are looking for new places to build
The real estate market in Buenos Aires is changing. Little to no financing is available, costs are unbearably high, and the most sought-after areas are already overflowing with development. What does all this mean for the real estate market? It means it’s time to look elsewhere; to think outside the box.
While many areas consolidate and continue to grow inward, others — such as Parque de los Patricios and Caballito — find new niches, and expand the limits of the neighborhood, allowing room for more growth at a more relaxed pace.
More investors are becoming available, looking for somewhere to save their dollars. Many will buy and then sell when better deals become available, but many will also buy and then hold onto the property, either for their children down the road, or for renting out. In the latter situation, they don’t always seek out the most popular areas, which means they have more affordable options available. And as many construction companies currently don’t have the workload they’re accustomed to, building and expanding in these less popular areas gives work to everyone related to the real estate industry.
These smaller projects usually range from 2000 to 5000 m2, built on a reasonable lot with an accompanying investor. Small zones are created within neighborhoods, especially areas such as Caballito that are quite expansive. Parque de los Patricios is a little different, as it is undergoing a city-directed plan to become a new technological district. But generally, these areas allow for accessible prices when it comes to sell. And such lots are not plentiful, which is a huge selling point.
It is clear that the general demand has gone down in recent years, but growth hasn’t come to a standstill, and these less popular neighborhoods are providing a great venue for continuing growth. However, phone inquiries have slowed, as have visits to showrooms, website traffic, and definitely completed transactions. Credit is hard to come by, and prices for homes aren’t exactly low.
That having been said, many vocational investors are still going strong, although the instability of the dollar in recent years has taken its toll on the market. With the peso rising, it means that it is a good time to sell for those who bought property in the past couple of years, but it also means that it is an even rougher time to buy. And higher quality projects tend to maintain their value, which is great for owners, but not so great for those looking to get into the market, when everything else is losing value.
Investors these days tend to be more conservative, and tend to invest in the higher quality purchases, which means the middle to middle-low gets abandoned. This means, however, that prices are more accessible for the average Joe looking to buy a home.
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