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The long term rental market in Buenos Aires is getting flooded with Apartment rentals - Prices falling

earlyretirement

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The long term rental market in Buenos Aires is getting flooded with Apartment rentals


An interesting situation and unusual phenomenon in the local real estate market: a significant number of rental apartments have reduced their price after failing to find tenants within 60 days.

Out of 15,000 apartments for rent, approximately 1,800 (about 12% of the supply) have lowered their price, and this trend is visible on real estate websites, where properties display signs announcing price reductions.

1. Recent Real Estate Context


In recent years, the rental market in CABA has been marked by a shortage of supply and rising prices, driven by inflation, economic uncertainty, and legislative changes (such as the repeal and subsequent reform of the Rental Law).


However, this new scenario suggests a shift in dynamics:

Increased supply: The rise in available properties is due to units that were previously on the short-term rental market (Airbnb, tourism) returning to the traditional market. With tourism falling, locals are throwing in the towel and moving to long term rentals creating a glut on the market.

This is GREAT news for existing Airbnb owners as more and more locals are exiting out of the market. They have sold off furniture and not likely to get back into the short-term rental market. So once tourism booms again there will be far less competition.


Lower demand: Economic factors, loss of purchasing power, or tenants moving to other areas may be reducing effective demand. People are struggling to keep up and pay bills. BA is expensive now!


2. Landlords’ Strategies


The reduction in prices after 60 days without finding a tenant indicates that landlords are adjusting their expectations to the new market reality. They prefer to lower the price rather than leave the property vacant, which entails additional costs and risks.

3. Market Impact

Greater competition: Renters have more options and bargaining power.

Possible price stabilization: If the trend continues, rental prices could stabilize or even decrease in real terms.

Transparency: Real estate websites make comparison easier and force landlords to be more competitive.


4. Factors to Watch


Economic developments: Inflation, interest rates, and employment will continue to impact tenants’ ability to pay.


Public policies: Regulatory changes can modify supply and demand.


Short-term rental market: If tourism recovers, there could be a new shift of properties to that segment.


The price drop in more than 10% of rental apartments after two months without tenants is a clear sign of adjustment in the CABA market. This unprecedented situation could benefit those looking to rent, at least in the short term, and marks a turning point after years of continuous increases. It will be key to observe whether this trend consolidates or is just a temporary phenomenon linked to specific factors.


BuySellBA - Keeping track of the latest real estate happenings in Buenos Aires so you don't have to

 
The long term rental market in Buenos Aires is getting flooded with Apartment rentals


An interesting situation and unusual phenomenon in the local real estate market: a significant number of rental apartments have reduced their price after failing to find tenants within 60 days.

Out of 15,000 apartments for rent, approximately 1,800 (about 12% of the supply) have lowered their price, and this trend is visible on real estate websites, where properties display signs announcing price reductions.

1. Recent Real Estate Context


In recent years, the rental market in CABA has been marked by a shortage of supply and rising prices, driven by inflation, economic uncertainty, and legislative changes (such as the repeal and subsequent reform of the Rental Law).


However, this new scenario suggests a shift in dynamics:

Increased supply: The rise in available properties is due to units that were previously on the short-term rental market (Airbnb, tourism) returning to the traditional market. With tourism falling, locals are throwing in the towel and moving to long term rentals creating a glut on the market.

This is GREAT news for existing Airbnb owners as more and more locals are exiting out of the market. They have sold off furniture and not likely to get back into the short-term rental market. So once tourism booms again there will be far less competition.


Lower demand: Economic factors, loss of purchasing power, or tenants moving to other areas may be reducing effective demand. People are struggling to keep up and pay bills. BA is expensive now!


2. Landlords’ Strategies


The reduction in prices after 60 days without finding a tenant indicates that landlords are adjusting their expectations to the new market reality. They prefer to lower the price rather than leave the property vacant, which entails additional costs and risks.

3. Market Impact

Greater competition: Renters have more options and bargaining power.

Possible price stabilization: If the trend continues, rental prices could stabilize or even decrease in real terms.

Transparency: Real estate websites make comparison easier and force landlords to be more competitive.


4. Factors to Watch


Economic developments: Inflation, interest rates, and employment will continue to impact tenants’ ability to pay.


Public policies: Regulatory changes can modify supply and demand.


Short-term rental market: If tourism recovers, there could be a new shift of properties to that segment.


The price drop in more than 10% of rental apartments after two months without tenants is a clear sign of adjustment in the CABA market. This unprecedented situation could benefit those looking to rent, at least in the short term, and marks a turning point after years of continuous increases. It will be key to observe whether this trend consolidates or is just a temporary phenomenon linked to specific factors.


BuySellBA - Keeping track of the latest real estate happenings in Buenos Aires so you don't have to


This is very insightful. My sister will be so happy. Her place in Palermo Hollywood is almost done later this year. She will be so happy. Are you sure @earlyretirement you won't take it on for management? She is willing to hire your interior designer and take your advice on whatever she needs. I see @Johnny's apartment so busy. She is willing to pay your full $5,000 fee just to get you to manage it. Pretty please?
 
The long term rental market in Buenos Aires is getting flooded with Apartment rentals


An interesting situation and unusual phenomenon in the local real estate market: a significant number of rental apartments have reduced their price after failing to find tenants within 60 days.

Out of 15,000 apartments for rent, approximately 1,800 (about 12% of the supply) have lowered their price, and this trend is visible on real estate websites, where properties display signs announcing price reductions.

1. Recent Real Estate Context


In recent years, the rental market in CABA has been marked by a shortage of supply and rising prices, driven by inflation, economic uncertainty, and legislative changes (such as the repeal and subsequent reform of the Rental Law).


However, this new scenario suggests a shift in dynamics:

Increased supply: The rise in available properties is due to units that were previously on the short-term rental market (Airbnb, tourism) returning to the traditional market. With tourism falling, locals are throwing in the towel and moving to long term rentals creating a glut on the market.

This is GREAT news for existing Airbnb owners as more and more locals are exiting out of the market. They have sold off furniture and not likely to get back into the short-term rental market. So once tourism booms again there will be far less competition.


Lower demand: Economic factors, loss of purchasing power, or tenants moving to other areas may be reducing effective demand. People are struggling to keep up and pay bills. BA is expensive now!


2. Landlords’ Strategies


The reduction in prices after 60 days without finding a tenant indicates that landlords are adjusting their expectations to the new market reality. They prefer to lower the price rather than leave the property vacant, which entails additional costs and risks.

3. Market Impact

Greater competition: Renters have more options and bargaining power.

Possible price stabilization: If the trend continues, rental prices could stabilize or even decrease in real terms.

Transparency: Real estate websites make comparison easier and force landlords to be more competitive.


4. Factors to Watch


Economic developments: Inflation, interest rates, and employment will continue to impact tenants’ ability to pay.


Public policies: Regulatory changes can modify supply and demand.


Short-term rental market: If tourism recovers, there could be a new shift of properties to that segment.


The price drop in more than 10% of rental apartments after two months without tenants is a clear sign of adjustment in the CABA market. This unprecedented situation could benefit those looking to rent, at least in the short term, and marks a turning point after years of continuous increases. It will be key to observe whether this trend consolidates or is just a temporary phenomenon linked to specific factors.


BuySellBA - Keeping track of the latest real estate happenings in Buenos Aires so you don't have to


Has this ever happened before? So there is price deflation on something. This seems like great news! I see tons of Airbnb's still at low prices. I think rentals are the only cheap thing now in Buenos Aires. Everything has skyrocketed in prices.
 
Increased supply: The rise in available properties is due to units that were previously on the short-term rental market (Airbnb, tourism) returning to the traditional market. With tourism falling, locals are throwing in the towel and moving to long term rentals creating a glut on the market.

This is GREAT news for existing Airbnb owners as more and more locals are exiting out of the market. They have sold off furniture and not likely to get back into the short-term rental market. So once tourism booms again there will be far less competition.
Wow this is EXACTLY what you told me was going to happen last year. How did you know? Seriously everything you told me in July 2023 is all coming true. Sometimes I think you can see the future brother!

This is very insightful. My sister will be so happy. Her place in Palermo Hollywood is almost done later this year. She will be so happy. Are you sure @earlyretirement you won't take it on for management? She is willing to hire your interior designer and take your advice on whatever she needs. I see @Johnny's apartment so busy. She is willing to pay your full $5,000 fee just to get you to manage it. Pretty please?
@Betsy Ross my place has literally only had about 8 nights since November that wasn't rented. I don't know how they do it. I can't even stay in my own apartment in August when I am coming back! How is that for you. I have to rent one of Mike's other apartments in the same building. I am coming back down there. I would do whatever it takes to get him to manage your sister's place. I met a few expats and they have apartments the same size as mine and they aren't getting even half of what I am getting. Granted, they didn't put in a $1,800 USD mattress! I spent about $20,000 plus I paid their interior designer $6,500 USD fee to handle buying everything. It was a lot of work and took 2 months. But it turned out great. I have been getting at least $2,300 USD per month in rental income. One of the best investments I have ever made. Plus the value skyrocketed on it.

I can't see why they wouldn't managed it if you paid the entire consulting fee plus hired them to furnish it. I will put in a good word for you. It was great meeting you. Let me know if you want to meet up again for lunch. We are coming in mid August. If Mike is too busy I would be happy to meet you.
 
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