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Real Estate Dealings in Argentina

October 22, 2011

In Argentina, real estate is a funny thing. Buenos Aires has seen a boom in real estate since the economic crisis of 2001-2002. But buying and selling real estate in Buenos Aires has to be one of the most ridiculous processes in the history of the world. And I mean that.

First, an inmobiliaria (real estate brokerage) in Buenos Aires are the biggest bunch of crooks out there. They do precisely nothing to help either buyers or sellers to get what they need out of a deal. They are only looking to make money. Not only routinely, but as a RULE, the do not know such simple things as square footage (actually square meterage), the reglamento (zoning) for the property, whether or not the zoning could be changed, and even the price! How could you not know the price of a property you are selling!

Second you have the problem that there is no such thing as escrow in Argentina. This means that literally cash has to be counted out for the purchase of a property. Yes hundreds of thousands of dollars, US Dollars, have to be counted out in order complete a transaction. This is such a simple problem to solve.

Third, all property prices are routinely published in US Dollars yet legally, Argentines are required to do official escritura (the deed to the property, or sale contract or title depending on the context) in Argentine pesos. WHAT?!?! If this is not direct evidence as to the contradictory nature of this country I don’t know what is.

What my business experience has taught me is that clarity and accountability in every possible manner are the keys to success, ease and efficiency. It disappoints me greatly when I see that there are so many obvious solutions to problems that don’t get done. These solutions are not even hard!

More on this in another post as this is truly illustrative of Argentine culture.

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4 Comments leave one →
  1. operarose permalink
    November 3, 2011 1:37 am

    I just found your blog on a google search and had to laugh at many of your posts I’ve read so far because they sound so reminiscent of my own rants about Chile. I’m an American expat currently living in Northern Chile and just returned from a week away from Chile in (what I felt was, by comparison) the heaven that is Buenos Aires (no, I’m not being sarcastic)! I was willing to overlook Argentina’s less glamorous side as a trade off for the excellent coffee, food, shopping, and culture (of which there is very little around here). Anyways, good luck!

  2. May 16, 2013 12:29 am

    I am an American who doesn’t understand how people move to other countries and think that their thinking and/or way of doing things are “superior” to that of other countries. Your blog is very interesting and I get a great kick out of the comments, but I am bewildered by the ethnocentric points of views not only from Americans but also from Argentines themselves. I am not so surprised by Americans as many times our culture thinks that the American way is the right way which just shows lack of exposure, culture and education in my opinion. You are absolutely right about the differences in purchasing property in Argentina. For those of us used to a more systematic process of purchase in the U.S. purchasing something in all cash may seem ridiculous, but believe it or not, to many people, paying off your home in 30 years with interest rates and fees that equal to more than double the selling price seems ridiculous. No one calls our government crooked for dropping the interest rate but adding upfront PMI AND monthly PMI that is far above what 10-15% interest rates represent. I have purchased properties in the U.S. and in Argentina throughout the past 10 years and yes it is very different. But if I am choosing to invest and/or do business in a different country I am going to educate myself and play by the rules of that country as we expect foreigners to do in our own country.
    In terms of the realtors in Argentina versus the ones in the U.S. well you are apparently dealing with shmucks…The realtors in the U.S. are almost ALL shmucks who barely have a high school degree. It’s like anything; it depends on who you deal with, in the U.S. or Argentina. I dealt with 3 different realtors in Argentina and they were all exceptional. The process was different but I dealt with nothing but professionals who went out of their way to walk me through a very new process. I have to say that I may not agree with certain parts of the process, but if I didn’t like it I should stay put and deal with the idiosyncrasies of my own country.
    The biggest difference I experienced between real-estate in the U.S. and Argentina was the R.O.I (Return On Investment). I only wish I would have purchased more in Argentina 5 years ago.

    I respect your Blog but I just feel like people are not comparing apples to apples. If you are interested in premium service you have to deal with industry leaders. Do your homework. I did and it paid out. Also, fly to Argentina and ask questions like you would here. I do business every day in the U.S. and trust no one. The red white and blue lapel and the I love Jesus sticker doesn’t make me trust anyone more in the U.S. Just because it’s wrapped in a prettier package doesn’t make it better and/or less crooked. Again, I only speaking from my own experiences.

    • May 16, 2013 5:17 pm

      A big thank you for this comment! This is one of the most accurate and intelligent comments I have read thus far. I basically agree on all of your points. Yes industry leaders in Argentina in the real estate industry are very easy to deal with. Unfortunately most properties are not controlled by them. Yes real estate agents tend to be less than honest in the USA, but to me the big difference is simply whether people have information or return emails and phone calls. Also, I would only shift your first comments to a nuanced synonym for ethnocentric… it’s really nationalism we are talking about. Most people have pride of where they are from, even Argentines (and especially when it comes to stuff they know they do well like soccer, beef, tango and wine), but a large percentage of Argentines who tend to have more money actually are very negative about their own country.
      Have you listened to my podcast? http://www.bacast.com Let me know what you think!

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