Though higher prices and the lack of affordable credit make buying a house in Buenos Aires more difficult than purchasing a compact apartment, many buyers are willing to pay the difference in order to enjoy the advantages a house can offer. A house can provide recreational spaces such as a garden and/or patio, swimming pool, and barbecue pit. The owner is free to remodel the house without having to get prior approval from a homeowners association and avoids having to pay homeowners association fees for the maintenance of community property areas.
The current economic instability brought on by the global financial crisis is causing many people who have capital on hand to insure their money by investing in the purchase of a house. They feel that in the short and medium run money will be worth less and tangible goods and property will increase in value. Though house prices in Buenos Aires experienced an increase in values two to three years ago, prices have stabilized over the past year and a half.
When looking at housing prices, the value of each home is unique. The most important factors in determining the value of a house are the size and location of its lot and the quality of construction. The same house on the opposite side of the street can be priced differently due to its immediate surroundings and the direction in which it faces the sun. Housing prices also vary according to the neighborhood, its comfort features, the amount of free spaces it has and whether it has a pool, barbecue area, and a one or two car garage.
In the highly exclusive area of Barrio Parque (Palermo Chico), prices can vary in a wide range from USD 2,500 to USD 4,500 per square meter. In Barrancas de Belgrano and the southern residential area of Caballito, prices range from USD 1,800 to USD 2,500 per square meter. In most other areas, prices vary between USD 900 to USD 1,700 per square meter.
The houses in greatest demand are those found in the more residential sectors within each neighborhood, nestled between other good quality homes. Proximity to transportation and schools and being close, but not too close, to a freeway are the other factors people favor.
The most requested neighborhoods are Belgrano R, Nuñez, Palermo and Colegiales. A modern house in the northern part of the city of Buenos Aires, which includes Belgrano, Nuñez, Palermo, Colegiales and Villa Urquiza, with a good-sized lot and a house measuring 200 m2 is averaging between USD 280,000 to USD 320,000. In Nuñez a 190m2, two story, four bedroom house on a lot measuring 8,66 meters wide by 24 meters long with a garage, pool, club house and barbecue area is priced at USD 300,000.
The housing market in premium neighborhoods is quite special. The pocket between Avenida Figueroa Alcorta, Juez Tedin and San Martín de Tours is the highest priced area of Buenos Aires. There are no more than two hundred houses nestled in a park like setting. The sale of these homes is more complex than an apartment; each house has its own style and there can be variations in how well the home has been maintained.
An essential requirement in homes of this level is a spacious garden. A garage is ideal; however, in the more exclusive areas residents have ample street parking available.
In Barrio Parque and Gran Bourg the price of a lot is averaging USD 3,500 per square meter. The costs of construction vary according to the quality of materials used, surface size and layout; however, costs range between USD 1,000 per square meter on the low end and USD 2,000 per square meter for higher quality.
Those who sell their house in Barrio Parque are likely to move to a quality apartment in Recoleta. The difference in price allows them to purchase a second apartment as rental property. Those who buy a house in Barrio Parque obtain a luxury home with a spacious garden and pool in the highest valued area of Buenos Aires which will never lose its value.
In the Buenos Aires’ real estate market, houses are sold for three different purposes. The first is for residential use where the buyer intends to live in the home or rent it out. The second is for the land. In this case, the buyer is usually a developer who demolishes the original house and builds an office or apartment building. The third situation is where the house is refurbished and/or remodeled for commercial use. The latter two purposes have accounted for the greatest number of sales and have experienced the greatest increase in value. They also account for a reduction of the availability of residential houses on the market.
Buyers will continue to be drawn to the benefits of a house in which they can find more light, sun, space, and air, while they have the freedom to modify their property as they wish and avoid costly homeowners association fees. The one negative point is security, being more vulnerable to theft. That is why most buyers prefer a house on a well-lit street close to transportation and schools.
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