RIO DE JANEIRO, BRAZIL – Argentines’ interest in investing in Uruguay is not new, as in the last 10 years they have bought over 1,200 properties in Montevideo’s downtown neighborhoods.
As of today, there are almost 86,000 Argentine property owners in Uruguay (including their first and second degree relatives) and some 30,000 have properties in Maldonado.
However, their interest in continuing to invest in Uruguay has grown in recent times, mainly due to the good control of the pandemic in the country, coupled with the historical guarantees it provides in terms of political and economic stability and respect for the commitments made.
During the Uruguay Invierte event organized by InfoCasas real estate website on January 5 and 6, the results of a survey of 650 investors were released: 65% were Uruguayan, 28% were Argentine, 4% Brazilian and the remaining 3% were of other nationalities.
Of the 28% Argentine investors, 62% live in Argentina and want to invest in Uruguay, 30% want to invest in order to settle there and 8% have tax residency in the country.
In turn, 60% of respondents are looking for properties to invest, 28% are looking for properties to live, 9% are looking for commercial properties and 3% are looking for land and farms.
The price ranges most sought after by all investors (Uruguayans, Argentines, Brazilians and others) are between US$120,000 and US$190,000 for apartments and between US$270,000 and US$380,000 for houses.
Some 68% of respondents are looking for properties in Montevideo, 21% in Punta del Este, 10% in Ciudad de la Costa and private neighborhoods, while the remaining 1% are looking for other options.
INVESTORS’ MOTIVATIONS
InfoCasas investment specialist Javier Ache said that as a result of the pandemic, many investors are aiming for “something safe” and that is why they are looking at the real estate market. “Bricks are a sure thing, projects in buildings. It is safe because Uruguay has guaranteed an annual income of between 5% and 7% in the last 10 years, depending on where you invest,” he explained.
“That offers investors a certain peace of mind. Argentines take a boat, in 2 hours they are here and they can see how their investment is performing. I invest in brick and it is something that I can see, that I can touch tomorrow once it’s completed and that gives them peace of mind,” he said.
Ache said that Law 18.795 of Promoted Housing generates significant incentives such as 10-year tax exemptions and that although Montevideo’s downtown neighborhoods are developing significantly, there is also a trend towards decentralization, with growth in Ciudad de la Costa and private neighborhoods, as well as in the Punta del Este area.
“The pandemic allowed working from home or in a hybrid format in which people work 3 days remotely and 2 days at the office, so they started to choose to live in Punta del Este or outside Montevideo and go to the office twice a week. This creates other conveniences such as a green environment, more space and the tranquility of moving out of the downtown area,” he explained.
However, he also pointed out that people choose to live in downtown Montevideo because of “the connections, the proximity to their work and because they have a different lifestyle.” In this respect, he said that investors are focusing on buildings with amenities such as barbecue, solarium, swimming pool, gym and terrace.
“With the pandemic, people are looking for a little more air, so we have a public that needs to live downtown while looking for amenities to relax during their time off work,” he added.
Another point Ache highlighted is the growth of the Paraguayan public coming to Uruguay, initially on vacation, but who are now interested in investments.
OWNERS WILLING TO REINVEST
Today, 97.4% of foreign owners who bought over 1,200 properties in Montevideo’s downtown neighborhoods are “very pleased with their investment,” and would invest again. Meanwhile, 89.1% of potential buyers “are very sure” that they will invest in Montevideo in the next 6 months, according to a survey conducted by Moebius real estate consulting firm.
The recovery of investment is key to reinvesting and reacquiring a property in Montevideo, the report explains.