Author Archives: Elias Kier Joffe

Real Estate Purchase Process in Buenos Aires, Argentina

 

OVERVIEW

Buying property in Argentina as a foreigner is legally straightforward:

Real estate in Argentina is typically held, bought and sold freehold. Property can be acquired by individuals and corporations. The only restriction concerning foreign real estate ownership applies in the immediate vicinity of Argentina’s borders, where such ownership is subject to prior government approval.

Owning Property in Argentina is safe for the following reasons:

Under the Argentine constitution foreigners have the same property rights as Argentine nationals. The property market is priced in US Dollars. This provides a shelter from economic crises for locals and protects foreign investors from fluctuations of the Argentine Peso. If you follow the well known 3L Rule (Location, Location, Location) you will not lose money.

There are also some differences with real estate transactions in other countries:

In Argentina every single real estate purchase must go through a special attorney called an “escribano público” (Notary Public). The escribano is crucial when buying real estate in Argentina. He has to check that the seller is registered as the owner, all taxes and duties have been paid, there is no lien on the property and that there are no existing mortgages attached. He prepares the boleto (binding pre-contract) and the deed and unlike the realtor he is fully responsible for his advice and actions.

Duration:

After the sale price has been agreed it takes approximately four to six weeks until the signing of the title deed transfer (equivalent to the exchange of contracts). If you are not willing to stay in Argentina for this time period you can grant a Power of Attorney: letting the deed be signed by a person you trust.

DOCUMENTS

The legal side of buying property in Argentina is straightforward. The only documents needed are your passport and your personal Argentine tax number or CDI (Clave de Identificación). To obtain a CDI you must prove your address in Argentina (rental apartment, friend’s house) with a “certificado de domicilio”.

This can be obtained at the nearest police station to where you are staying. With this document and your passport you must then go to the nearest AFIP office (Argentine tax authority) to get the CDI. If you do not speak Spanish it is recommended that you go there with somebody who does speak the language and is also familiar with the system. Otherwise, you can let somebody else do it for you (requires a Power of Attorney). 

BUYING PROCESS

This section explains what happens after you have found the property you wish to purchase. 

Reserva:

You will make an offer to buy the property at a certain price call Reserva. It is wise to always offer a lower price (at least 5%) even if you think the asking price is already attractive. To confirm your offer the seller’s realtor will ask you for a payment in cash amounting to 2% of the offered price. The offer (Reserva) is usually valid for a week. During this period the realtor is supposed to take the property off the market and inform the seller of your offer. The seller will either accept your offer, reject it or, most likely, make a counter offer. Then it is your turn to accept, reject or make a counter offer. If an agreement on the price cannot be reached and the reserva expires, you will get your money back. If the seller accepts your offer and you back out, your money will not be returned.

Boleto:

The Boleto (a binding pre-contract) is a document normally prepared by the escribano. This is an intermediary step where the seller receives 30% of the agreed sale price. It is most commonly used when the signing of the title deed transfer is scheduled 45 days or 2 months down the line. The boleto is basically the point of no return for both the buyer and the seller. If the buyer backs out, they lose the 30% down payment. If the seller backs out, not only do they have to return that 30% but they must also pay another 30% in compensation. But, unlike the reserva, the boleto also gives the prospective buyer the legal right to enforce the property sale (although any resulting lawsuit might take years).

Escritura:

The Escritura is the actual closing date when all parties get together to sign the official deed transfer. The buyer now takes possession of the property. All taxes on the property must be fully paid up at the time of transfer.

The agreed sum is paid in cash at this time or a transfer to a foreign bank account is set up and verified at a second meeting. It is important to note that the payment required for the escritura does not need to be made in pesos. In fact, most owners will only accept US Dollars or transfers to their accounts held abroad. The buyer does not have to be physically present to sign the transfer deed if a third party is authorised by a Power of Attorney to sign in their place. It is important at this point to have requested and obtained updated floor plans that reflect actual construction. Failure to do this may result in the new buyer having to pay the unpaid taxes of the previous owner. This also guards against any unlawful construction done to the property that could lead to problems in the future with the municipal government.

COSTS

Realtor commissions: 3% to 4% of the closing value plus 21% VAT (3.63-4.84%)

Money transfer fee: 3% to 6% (depends on the time of the year)

Escribano fees: 2% plus 21% VAT (1.21-2.42%)

Stamp fee: 3.6% in the city (Capital Federal) of Buenos Aires and 3.6% in the suburbs of Buenos Aires, but if the purchase is in US dollars you have to add a 20%, totaling 4.32%. If the property is for residential use, valued under ARS 600,000, and it is the client’s first purchase the stamp fee is waived. If it is priced over ARS 600,000, the stamp fee will only be paid on the difference (Purchase price minus ARS 600,000). The stamp fee is commonly split 50:50 between the buyer and seller but you must request this when you make your offer.

Transfer Tax: Tansfer Tax is 1.5% of property value, paid by the seller. However, this tax is not applicable if the resident seller is selling his main dwelling and commits to buy another property within a year.

The proven Buenos Aires – Argentina lawyer professionals at the Kier Joffe law firm have experience working with foreign clients involved in all kind of cases in Argentina. Buenos Aires Argentina attorney professionals are knowledgeable in almost all the practice areas of law, to service its international cases in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires  lawyer in Argentina.

www.kierjoffe.com

Argentina Real Estate Appraiser Property Appraisal Buenos Aires

Argentina Real Estate Appraiser Property Appraisal Buenos Aires

Argentina Real Estate Appraiser Property Appraisal Buenos Aires. What is the property worth? Get the property valuation today.

Properly appraising a property’s value is often a challenge for real estate professionals.  An accurate appraisal helps finalize a real estate transaction correctly and in a timely fashion.  The correct pricing of a property serves as a starting point on which to base negotiations in a sales transaction.

One of the primary factors in real estate property in Buenos Aires is the property’s location.  This one element strongly influences a property’s price.  An appraisal must weigh the advantages and disadvantages of each location in terms of modes of transportation at hand, the area’s zoning, and the quantity and quality of public services available.  Prices can vary from one block to the next and from one side of the street to another.

The second factor which affects an appraisal are the physical characteristics of the property.  This includes its design and appearance, the property’s age, its condition, the type and quality of construction, its surface area and dimensions, and how well it’s equiped.

A good appraisal should take into account potential clients’ needs, the area, the property’s condition, lighting, what part of the neighborhood it’s in, proximity to transportation and commercial centers, and in the case of aparments, what floor of the building the property is on.

A real estate appraisal is often based on the appraiser’s experience and knowledge of the local market.   Some people in the real estate field simply use the area’s average per square meter value, but others believe that method to be too basic and unprofessional.  Each property has numerous variables, all of which are very important.  A good appraisal is based on visiting the property (inside and out),  having knowledge of the local market, taking into account the supply and demand for that area, and analyzing economic conditions at that time.

Properties in certain neighborhoods increase in value solely because they are located in a coveted area.  Modes of transportation available, the development of the area, and even the prestige of the neighborhood, as in the case of  Barrio Norte, Recoleta, Palermo Chico and Barrancas de Belgrano, are fundamental factors in maintaining a property’s value.  In these areas, the scarcity and high cost of available lots also contributes to increasing property values.

When considering an apartment, another influential factor in appraising its value are the amenities the apartment building offers.  If a buyer is able to afford the higher homeowner association fees for these services, the amenities add value to the property.

Argentina Real Estate Appraiser Property Appraisal Buenos Aires. What is the property worth? Get the property valuation today.

For years, mortgage lenders and consumers have called upon Kier Joffe Appraisals to provide high-quality appraisals on all sorts of properties throughout Argentina. By continuously analyzing Argentine real estate trends and refreshing our knowledge regarding valuation techniques through accredited courses, we’ve been consistently able to generate reliable home valuations for our clients.

All of our appraisers have more than 20 years of experience, and use the latest technology available to provide the most accurate, professional, and eco-friendly appraisals possible.

The proven Buenos Aires – Argentina lawyer professionals at the Kier Joffe law firm have experience working with foreign clients involved in all kind of cases in Argentina. Buenos Aires Argentina attorney professionals are knowledgeable in almost all the practice areas of law, to service its international cases in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires  lawyer in Argentina.

www.kierjoffe.com

Argentina One Stop Source:Legal, Tax, Accounting & Notarial Services

Kier Joffe is adept at assisting non-Argentinian clients to understand and adapt to Argentinian practices.

We offer guidance to individual and businesses from outside Argentina on adapting to the Argentinian legal system and its laws at both the federal and province level.

We offer services specifically designed to provide a “one-stop” source of Legal, Tax, Accounting and Notarial support for foreign individual and businesses’ operations in the Argentina.

Kier Joffe can assist with entity formation, regulatory compliance, transactional support, documentation and distribution arrangements and dispute resolution. We can provide critical Legal, Tax, Accounting and Notarial support to protect revenues and assets throughout Argentina.

Basic Legal Requirements When Buying/Selling in Buenos Aires Argentina – Real Estate

Three Basic Legal Requirements When Buying/Selling Property in Buenos Aires

Whether you are buying or selling property in Buenos Aires, it is important for you to be aware of some of the legal requirements.

Firstly, whenever a property owner intends to sell a property, or acquire the right to construct on a property, he/she is required to notify the Administración Federal de Ingresos Públicos – AFIP (federal administration of public income, similar to the Internal Revenue Service in the United States).  The AFIP must be notified only if the transaction will have a value equal to, or greater than, $300,000 Argentine pesos.  The transaction must be completed by the owner or his/her representative by contacting the AFIP by telephone, cell phone or via internet (www.afip.gov.ar).

Secondly, if a real estate broker is going to intervene in the sale, a 90-day contract granting the broker authorization and exclusive rights to sell the property is drawn up between the seller and the broker.   Within 30 days, the AFIP must be notified of the broker’s involvement in the sale.  It is then the broker’s responsibility to notify the AFIP when a deposit is made on the property and when the property title is transferred.

Thirdly, the title transfer must be completed by an escribano publico (notary public).  In Argentina, a notary public is a highly qualified individual with a law degree and additional post-graduate studies. When a property is sold, the escribano publico serves as a public official who guarantees the legality of the property title, the authenticity of the seller, and the legitimate transfer of the property title from seller to buyer.  It is imperative that you ensure you have a qualified escribano publico handling the sale of any property, especially if you are the buyer. *

There are costs associated with these different steps, all based on percentages of the property’s sale price.   A 1.5% property sales tax, known as Impuesto a la Transferencia del Inmueble (ITI), is due if the seller is not reinvesting the proceeds of the sale in the purchase of another property.   The costs of transfering the propery title from seller to buyer runs between 6% and 9%.  The realtor’s commission averages 3% to 4%.

* In Argentina an escribano publico must be registered with his/her local Colegio de Escribanos.

The proven Buenos Aires – Argentina lawyer professionals at the Kier Joffe law firm have experience working with foreign clients involved in all kind of cases in Argentina. Buenos Aires Argentina attorney professionals are knowledgeable in almost all the practice areas of law, to service its international cases in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires  lawyer in Argentina.

www.kierjoffe.com

Legal Opinion

Legal Opinion

Legal Opinion Lawyer Argentina:Legal Opinion Buenos Aires Attorney

Legal opinion letters are required in many types of transactions. Financial institutions request them before they make loans to businesses. Purchasers of businesses or real estate may require the seller to deliver a legal opinion letter before closing the transaction. Supporting legal opinion letters may be required in connection with the sale of stocks or bonds. Many transactions with governmental entities require legal opinion letters. Legal opinion letters typically address matters such as legal authority and the enforceability of the agreements being entered into, and may also include industry specific legal opinions.
Our lawyers have the experience and reputation to issue legal opinion letters in all types of transactions. They know which types of opinions should be issued and which should not. Our lawyers can help you get your transaction to close, while protecting you from unreasonable demands from the other side of the transaction.