Mortgage Credit in Buenos Aires Argentina

These days, with the lack of credit in the Argentine real estate scene, making the leap from a one-bedroom to a two-bedroom is a very complicated task. Many families have just barely what they need for a livable housing situation, and when something changes in the family, be it a new child or just growing lives, finding resources to add to the family home can be extremely difficult. Many start to feel like they are playing an unsolvable puzzle, a human game of Tetris.

Many couples buy their first home when they are just that: a couple. While they have a family in mind, they are simply getting into the business of owning a home, buying just what they can afford. But when the time comes for children and expanding the family, there are simply not the resources available to buy a larger home. This can be especially difficult for those who use a spare bedroom as a home office, for freelancers whose home is also their workspace.

The middle class finds it increasingly difficult to buy, given the absence of mortgage credit available in the country. Even for those who have the capacity to save, waiting to save enough to actually buy can prove to be quite difficult in the current Argentina real estate market.

Making the leap means analyzing exactly what is necessary, how much money is available, and then what concessions can be made if the needed property isn’t available. It is also important to remember, though, that moving again in the future may be both a necessity and a possibility; the property the family is now buying is not necessarily the end of the line. It does need to be comfortable, though, as buying may not get any easier in the future. In the end, it is all a matter of balance and compromise.

There are alternatives, however, to a traditional mortgage. Buying a property at the time of construction allows for lower prices —up to 20% lower — and many times buyers can make payments as construction continues. Another option is to buy a property that needs to be refurbished, and then finding economic means for doing so. These properties can often sell for 30% lower than traditional prices. A third alternative is to move to the suburbs, where a family can have more space for less; the suburbs are often the most desirable place to raise a family, anyway. Finally, the buyers can choose to move to a more economical neighborhood, such as from Palermo to Villa Crespo.

In Palermo, augmenting the apartment by just one room can increase the price by around US$20,000. The most difficult is moving from a one-room to a two- or three-room. As the one-room apartments are generally for single, young people, or even young couples, they rarely require many extra amenities. But when a family is looking for a larger space, they often also require more features and comforts, something more conducive to raising a family, be it well-lit rooms, nice neighborhoods, or other options. Upgrading by just one room can add from 20 to 30 percent onto the price, within the same neighborhood.

Sometimes, these problems need to simply be solved by really good organization, dividing the space in ways that allow the most efficiency. If not, most families do decide to change neighborhoods, allowing them to keep their same quality of life, while still being able to afford an upgrade.

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