Finding the next up and coming property market is the dream of many investors all over the world. Doing this means carrying out a lot of research and perhaps looking in places where you wouldn’t normally look.
One option worth spending some time on in Argentina. This giant South American country is going through a torrid period economically just now, but is it the right time to buy property here?
A Bit About the Country
Argentina is the eighth biggest country on the planet, just behind India. However, a relatively modest population of 44 million puts it in 48th place in terms of number of inhabitants, behind Spain and Uganda.
As this data suggests, Argentina is filled with vast, empty spaces, such as the wind-swept pampas and the southerly Tierra del Fuego. It also contains an incredibly diverse set of climates and types of wildlife, making it one of the planet’s most biodiverse countries.
The human population is largely crammed into the huge urbanised area in the centre of the country around the Rio de la Plata, with some 13 million Argentines living in the Buenos Aires metropolitan area.
The Currency Economic Situation
It is fair to say that the economic history of Argentina has been turbulent. Dictatorships, economic depression and political scandals have frequently rocked the country.
Despite this, it has consistently been highly-regarded for its standard of living. For example, it is the second-highest Latin American country in the Human Development Index for 2019. Argentina has typically been seen as a cultural hotspot, with tango, literature and good food among its highlights.
The current economic troubles have seen the value of the Argentine Peso fall dramatically. At the start of the 21st century, 1 peso was worth around $1. In the last few years, a series of tumbles mean that over 60 pesos are needed to buy a single dollar.
This fall in the national currency has been accompanied by rampant inflation. It is hard to get accurate figures for this, as many sources dispute the official inflation numbers as being artificially low. However, visitors from abroad report that their money now goes further here. This includes in the property market, where prices have been falling.
The biggest market, in Buenos Aires, has seen prices falling steadily for more than a year. An acute lack of demand means that houses in the capital are ripe for buyers looking to pick up a bargain. Tough new regulations that stop citizens from buying more than $300 dollars in US currency each month has also reportedly crippled the market.
What Does the Future Hold?
Predicting the economic future in Argentina is never easy. A series of governments have tried and failed to reverse the decline that has been seen for large chunks of this century.
There is no doubt that the country has a strong infrastructure and an astonishing selection of natural resources, though. This is the second-strongest South American economy after that of Brazil.
Agricultural exports, a diverse mix of industries and a relatively low level of inequality all point to a country that should be doing better than it is just now.
It seems sensible to suggest that it will be back on its feet before too long, leading to the peso rising and property prices recovering.
At the end of 2019. Alberto Fernandez became the country’s new president. His vice president is former leader Cristina Fernández de Kirchner, who oversaw modest – and disputed – economic recovery in her controversial stint between 2007 and 2015.
The peso fell 4% when his primary election victory was announced, but it is still too early to see what long-term effect the new president will have.
Many Argentines hope that Fernandez’s pragmatic, socialist approach will help to awaken this sleeping giant. If they do, then anyone who invests just now will reap the benefits in the future.
Apart from financial concerns, this remains one of the world’s most alluring destinations and is somewhere anyone who enjoys living a good lifestyle will feel right at home.