The Argentine government implemented a restriction on real estate purchases using U.S. dollars in 2012 and studies show the so-called “clamp” had a significant impact on transaction volume when compared to 2011. Transaction volume fell 27% overall for the year, with transactions slipping a whopping 46% for the month of September when compared with the same month last year. Sales in Buenos Aires alone fell 21.16% and experts say it’s because sellers don’t want to accept pesos for their homes or spend their dollars on new homes. For more on this continue reading the following article from Property Wire.
The real estate market in Argentina has been hit by currency problems due to the introduction on restrictions on purchases in US dollars, according to industry experts.
The market in Buenos Aires fell 21.16% in value of sales in 2012, according to a report by the city’s Notary Public Association. The number of sales in the housing market, 46,625, was down roughly 27% compared to 2011.
The biggest decrease occurred in the month of September, when about 46% fewer deeds were purchased than in September 2011.
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Traditionally property has been bought in dollars in Argentine but last year the government introduced the so called dollar clamp which prevents Argentines form making transactions and saving in US dollars.
Also decades of inflation, hyper inflation and monetary chaos has made Argentines wary of the peso and they prefer to use the US dollar when possible.
‘People do not want to sell their real estate because they do not want pesos, while the sellers do not want to part with their dollars,’ said Germán Gómez Picasso.
There are signs of things easing slightly with notaries registering a small rise in sales in the final quarter of 2012 compared with the rest of the year and transactions have stabilised.
The average transaction in December was valued at 464.305 pesos, a fall of 1.1% compared with December 2011. Sales of lower priced property is doing better than the luxury end of the market.
This article was republished with permission from Property Wire.