Foreigners sell their properties in Buenos Aires

After almost two years of complications to get dollars, the foreigners that a while ago came to buy an apartment or property in Buenos Aires, now have decided to leave and sell their property. This is what it seems to have happened during the last few months, according to the analysis made in the Real Estate specialists in Argentina.

According to the Media and specialists on the Real Estate business, many foreigners who were interested in buying a property now don’t see it as an option, and those who have already bought a property, are now interested in selling it.

A few years ago, many foreigners came to Argentina, and Buenos Aires, in the search of an apartment with amenities; generally they looked for apartments in the most expensive neighbourhoods or areas of Buenos Aires, like Puerto Madero, Recoleta, or even in the northern area (outside the City of Buenos Aires) like Tigre or San Isidro. What seemed to attract the foreigners about Buenos Aires and its properties was those “classy” apartments with plenty of amenities (like Jacuzzi, sauna, etc.). The nice apartments, together with the convenience of the exchange rate they had in favour, really caught their attention. Today, since it is complicated to get dollars, and the whole world is going through an economic crisis, foreigners have chosen to sell the properties (if they have one here), so the situation has reversed; at least for now.

The Real Estate business situation in Buenos Aires and in Argentina is stuck at the moment, and the unstable economic situation does not help; so, it is matter of waiting and seeing what happens in order to start attracting foreigners who are interested once again in buying properties in Buenos Aires.

Compulsory expenses you need to pay when renting an apartment

When it comes to renting an apartment, the terms and conditions will depend on the arrangements made between the landlord and the tenant, and they usually differ in each contract. Still, there are some expenses and services that should be paid by the landlord OR the tenant.

Some examples of the expenses that are usually in charge of the tenant that rents the apartment are the light expenses, the gas bill, the telephone bill, etc. In some cases, some of these services are included in the maintenance fees charged monthly in the building. In those cases, the tenant usually pays the common maintenance fees in order to cover these expenses. Nevertheless, the maintenance fees is something that needs to be discussed before signing a lease contract, since the ordinary maintenance fees are usually paid each month by the tenant, and the extraordinary maintenance fees are usually paid by the landlord; still, this needs to be cleared beforehand, since problems usually arise over the matter. For example, if something breaks because the tenant misused it, who should pay it?

So, generally speaking, the monthly bills like telephone, gas, electricity, etc are usually paid by the tenant, but other expenses like the tax on Real Estate, etc are usually paid by the ladlord. Still, as we have mentioned at the beginning, the terms and conditions over expenses and its payment should be arranged between the landlord and the tenant before singing the lease contract… this way, future problems could be avoided.

Living in the City of Buenos Aires or outside of it?

In the last few years, many people who lived in the City of Buenos Aires have decided that the city and its hustle and bustle weren’t the best way to live. Still, having the family and the workplace in the City of Buenos Aires made people consider moving out of the city but no too far from it. With that, many people decided that living on the other side of the “bridge” is a good alternative.

Some people decided to move into “country houses" (gated neighborhoods) outside the city, where they could feel safer and have nature around them. Others tried living in places like Tigre and fell in love with its river. The alternatives on where to live are plenty since Buenos Aires is huge.

Now, those who work in the City of Buenos Aires (especially in the downtown area), and live outside the city of Buenos Aires, should consider that it will take them longer to get to work. Still, many people would rather spend more time travelling to get to work (or home on the way back) and enjoy living in a quieter place. On the other hand, those who don’t enjoy traveling from one place to another on a daily basis should consider moving to another neighborhood within the City of Buenos Aires (a more residential and quiet neighborhood). Another thing you could consider is moving in the “Gran Buenos Aires” area (the municipalities that surround the City of Buenos Aires) near a train station or an avenue that has plenty of means of transport to get to work.

Nowadays, most neighborhoods and areas that surround the city of Buenos Aires have a great variety of options when it comes to moving around the area and its surroundings, and they also have many shops and supermarkets where you can get everything you need, so that is something to consider when moving.

Nonetheless, time is something to consider, and whether you are willing to waiste time travelling or not. If you work from home, that will not be a problem; you may move any place you like within the city of Buenso Aires or outside. Last, something to consider before moving outside the City is the cultural alternatives you have within the city and outside the city… specially those who enjoy going out at night.

Taxes increase in Buenos Aires in 2014

After the budgetary meeting that took place on April, 2013 in the attempt of calculating the variations on the budget for 2014 in the City of Buenos Aires, the GOVERNMENT reached the conclusion that in 2014 the RAISE on the “ABL- Alumbrado, Barrido y Limpieza” (tax on street lights and cleaning) would increase on 40%.

According to some comments from the media, during 2014, the rise percentage would vary according to the valuation of the house: houses that worth up $150.000 Argentine Pesos will suffer a increase of up to 20%; those houses that worth between $151.000 and $300.000 pesos will suffer an increase of up to 30%; and those that worth more than $300.000 pesos will suffer as increase of up to 40%.

In relation to other years, the increase of the ABL in 2014 will not be as high as it has been in previous years, since during 2012 and 2013 there has been increases that reached 1000%. According to the government, this great rise on the ABL tax had to be made in order to determine the budgets for the coming year; plus, the prices where said to be behind according to the inflation rate.

The increase on the ABL tax in Buenos Aires for 2014 and on those that took place in the previous years were done in accordance with the “Ley Tarifaria” [Law on Tax rates in Argentina] signed in 2011, which allowed increases and also set some limits. As we have mentioned, even though the increase on the ABL will be high, it will not be as high as in the prior years.

It is estimated that with the increase on the ABL in 2014, around $4343 million pesos (just with the ABL tax will be collected. This sum has to be added to other taxes such as licenses, patents, among others. Altogether it is estimated that the Government of the City of Buenos Aires will collect 24% more on taxes than in 2013, and it estimates that it will have an expenditure of about 10,000 millions on public works.

Thus, for 2014, an increase of up to 40% is expected in the ABL tax. Still, the increase will depend on the price of each property, so we will have to wait for the bill to arrive.

Elections at CUCICBA in October

On October, 8th, 2013, elections took place at the “Colegio Unico de Corredores Inmobiliarios de la Ciudad de Buenos Aires (CUCICBA)” [Institute of Real Estate Brokers in the City of Buenos Aires].

After the elections, the results came to light and the “Lista Celeste y Blanca” was the one with most votes. Still, the opposing party, the “Lista Renovacion”, had 32% of the votes. This means that the “Lista Renovacion” will participate in the Governing Body of CUCICBA (3 members of the opposing list will participate), and it also has a group of 17 members at the assembly of CUCICBA.

These results turned out to be surprising for many because, if there are members of the opposing party, it is believed that the matters related to the Institute of Real Estate Brokers will be discussed in depth, and will result in the best interest of the enroled brokers.

As a result of the elections in October 2013 at the Institute of Real Estate Brokers in the City of Buenos Aires, the governing body is now composed by the following members:

Hugo Mennella (President); Carlos Sotelo (1^st Vicepresident); Hector D´Odorico (Vicepresident 2^nd); Jorge Antunez Vega (Secretary); Leonor de Achaval (2^nd Secretary); Norberto Mosquera (Treasurer); Fernando Cancel (2^nd Treasurer); Martin Boquete (Head Board member); Susana Spagnolo de Vincenti (Minute secretary).

Substitute Members: Nestor Walenten (1^st Board member); Eduardo Crivelli Granelli (2^nd Board member); Victor Capuccio (3^rd Board member); Gabriela Goldszer (4^th Board member); Roberto Mario Gomez (5^th Board member); Omar Porta (6^th Board member); Susana Di Dio de Representaçao (7^th Board member); Julia Mel (8^th Board member); Ana Rodriguez (9^th Board member).

Extension on the term for the declaration of money

In September 2013, the period for the declaration on undeclared money (and to buy Cedin and Baade Certificates with said money) came to an end. Since the Government managed to collect only 5% (approximately) of what they expected, they have decided to extend the period until the end of 2013. This way, with the extension of the period for 3 more months, the Government expects to increase the income of money from account that people have abroad.

Even though there have been different opinions on whether the period for the declaration of money should be extended or not, the President of Argentina had the last word, and decided to extend said period.

According to the Head of the AFIP [Administracion Federal de Ingresos Publicos – Public Income Administration in Argentina], Ricardo Etchegaray, on the tax level, the declaration of money and exchange of  Cedin and Baade Certificates were not profitable, and he recommended that the period should not be extended. Still, the Head of Foreign Trade in Argentina, Guillermo Moreno, thought the opposite and recommended that the period for the declaration of money should be extended, so that people can invest in Cedin and Baade certificates.

One of the objectives of the declaration of money was made with the intention of reactivating the real estate business in Argentina and help the economy of the country. One of the ways the government thought the Real Estate Business could start moving again was by creating the Cedin Certificates which can be used in the real estate transactions.

According to Guillermo Moreno, the proposal of the declaration of savings didn’t work as they expected because of the elections that took place in August and in October this year. Elections generally tend to create doubt and uncertainty. For this reason, the head of the Foreign Trade Department thought the period should be extended.

With this extension on the period for the declaration of savings and the creation of Cedin and Baade Certificates, it is expected that the government manages to collect the amount of money expected since the beginning in order to help the country’s economy.