How Javier Milei revived Argentina’s dormant property market

The opportunity has “ignited a surge in demand among Argentinians who have long awaited the opportunity to purchase homes through mortgage financing”, he adds.

Santander, for example, is offering a credit line at rates of around 5.5pc, for a maximum term of 30 years covering up to 80pc of the property value for permanent housing. Like in the UK, there are limits on the amount you can borrow relative to your income and the lender requires a monthly income of at least 850,000 pesos (£747.55).

But the likelihood of inflation heading upwards again means taking on a loan is not without risk. If it starts to climb again without wages keeping pace, buyers risk being unable to make their payments, warns Segura. 

A new opportunity

For many, particularly young people, the new loans could offer a huge opportunity.

“Until now, renting was the only alternative to living at home with their families,” says Segura.  

“There was no possibility to buy a home because either you had to pay upfront or you cannot buy.” 

Under the previous administrations, renting was also a struggle for many as four-year rent controls led landlords to flee the market. In the 12 months to February 2024, rents increased 286.7pc in Buenos Aires, according to platform Zonaprop. 

Since the legislation was scrapped, rents have fallen and the number of properties that are available for rent has increased significantly, according to industry body the Argentine Real Estate Chamber.

Historically, property prices in Argentina have been disproportionately high when compared to the income levels of the population, explains Andres.

“While the currently-undervalued Argentine peso has improved affordability for first-time home buyers, the persistent high inflation rates pose significant risks to the sustainability of home prices. 

“The success of President Milei’s efforts to curb inflation while simultaneously stimulating economic growth and increasing incomes will play a pivotal role in determining the trajectory of the housing market’s affordability.”

Property prices have remained resilient over the past few years despite the rocky economic conditions. In April the average property in Buenos Aires was $2,219 per sq m, rising 0.8pc in the month – the largest monthly increase since April 2018. Over the past 12 months, prices have risen 2.5pc with apartments seeing the largest increase, according to Zonaprop. 

This is because those with wealth deemed bricks and mortar to be a safe haven for cash.

“The financial market in Argentina is so weak that real estate is one of the popular investment alternatives,” adds Segura.

As inflation increased and domestic financial markets became too weak for investment, people with savings chose to put it into property, spurring demand and bolstering prices despite recession.

Looking ahead 

Under Milei, the outlook for the property market has improved, however experts say there is still huge uncertainty in the long term. If Millei is successful in bringing down inflation, interest rates should stabilise at lower levels, increasing mortgage affordability, says Abadia.

However, whether the green shoots in the market recovery can grow depends on the extent to which the economic stability can be established – and maintained. 

Abadia adds: “While challenges remain, the renewed availability of mortgage financing presents a promising opportunity for Argentinians to realise their dreams of homeownership.”