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.
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