Constantly rising, rental prices seem to have no ceiling: in the City of Buenos Aires the values of the apartments on offer increased by 10.1% in April. It is the largest increase since the Zonaprop platform began tracking this index in March of 2012.
So far in 2023, the prices that tenants have faced are piling up to 38.4% increase, higher than inflation which was 29.6% in the same period, and also the Lease Contracts Index (ICL), the indicator elaborated by the Central Bank, with a mix of inflation and wage evolution.
The average rental price of a studio apartment sits at $105,613 per month. A two-bedroom fetches $128,584 a month, and a three-bedroom is worth $169,000.
The neighborhoods of Palermo and Belgrano are the ones with the most expensive offer in the city, with a value of $165,061 and $152,104 per month, respectively.
They are in the central area Villa Crespo ($132,524 per month), Villa Gral Miter ($122,504), and Paternal ($115,029).
THE lower prices They can be found in Mataderos ($98,003 per month), Liniers ($99,268), and Flores ($104,432 per month).
Rising rents coupled with the downward trend in property values is driving profitability for landlords.
In April, by chance, the rent rose to 4.74%, ie 21.1 years of rent are needed to recover the purchase investment, 21% less than a year ago.
the neighborhoods San Cristobal and Boedo they show a gross return of 6.3% and 5.8% annually respectively. In this sense, They are the best neighborhoods for investors looking for rent. Conversely, Villa Devoto and Liniers generate the lowest profitability (3.9%).
Another survey, carried out between the University of San Andrés and the announcements published on the Mercado Libre platform, gives an account of the evolution of the real estate market in a wider area: the AMBA.
According to these records, the average rental price in constant pesos per square meter (that is, in real terms) in this area, it grew by 12.5% in the case of houses and by 4% in the case of apartments in April compared to March.
“Distinguishing by AMBA agglomerations, in April compared to March, the change in rent at constant pesos per m2 of homes was 6.6% in the CABA; 8.5% in GBA North; 17.2% in GBA South and 1.3% in GBA West.
In the case of apartments, the monthly price increase (compared to March 2023) in CABA; GBA North and South were up 12.7%, 3.9% and 2.9% respectively, while GBA West was down 1.1%.
A recent CESO report, which also includes April rental prices, points out that “the context of accelerating inflation adds uncertainty when it comes to having to set values that will apply for 12 months”.
“This, which is a macroeconomic problem beyond the contractual conditions, has translated into high entry values which, although with the current inflation rates they liquefy rapidly, constitute a significant barrier to the entry of a new lease”.
In this context, according to this Centre, “one observes an increase in the percentage of deals expressed in dollars, mainly starting in February 2022.
Source: Clarin
