Blue dollar effect: in a single month rents for houses in the North of the GBA rose almost 22%



Many of the homes offered in the northern area of ​​Greater Buenos Aires are rented in dollars
Many of the homes offered in the northern area of ​​Greater Buenos Aires are rented in dollars

A private report found that in the last month there were strong increases in house rentals in Greater Buenos Aires (GBA). On the north axis there were climbs on the 21.9% and in the south 14.1% per square meter compared month over month.

Distinguishing by agglomerates of AMBA, in July 2022, relative to last June, the variation in the median rental price per m2 of houses (in constant prices) it was 3.2% in Buenos Aires and 2.8% in West GBA. In the case of departments the inter-monthly variation of the price in Buenos Aires, GBA North, South and West it was moderate with 3.33%, 2.4%, 1.8% and 1.1%, respectively.

“To understand the jump in house rental prices offered in North GBA, it is necessary to consider two elements. On the one hand, during the month of July there was a considerable rise in the average parallel exchange rate (which is the one we use to pesify the rentals offered denominated in dollars). This increase in the exchange rate was 31% (going from $214.45 average in June to $281 in July). On the other hand, a high proportion of North GBA homes offered for rent are denominated in dollars,” he told Infobae Paula Margaretic, researcher from the Universidad San Andrés (UDESA) who, together with Mercado Libre, carried out the analysis.

“During the month of July there was a considerable rise in the average parallel exchange rate (which is the one we use to pesify the rentals offered denominated in dollars) and that had an impact on the prices per m2” (Margaretic)

The report detailing data by Buenos Aires neighborhoods and municipalities of AMBA specified that the highest year-on-year increase in constant prices of the value of apartments was located in Retiro with the 40.5% per m2.

The rents of the apartments located in the Retiro area were the ones that increased the most per m2 between June and last July according to an analysis by UDESA and Mercado Libre
The rents of the apartments located in the Retiro area were the ones that increased the most per m2 between June and last July according to an analysis by UDESA and Mercado Libre

Sebastian Einstein, assistant at the University of San Andrés, commented to Infobae that a possible explanation for the dynamics of this neighborhood is the fall in the supply of apartments for rent. “In fact, in July 2022, the number of rental listings in this neighborhood fell 53% year over year. As for the properties there, we can see that this area has one of the highest price levels in the Capital (see table). In addition, the units that make up the offer tend to be larger: the median of m2 covered is 95.5 m2 (compared to Belgrano R with 76.5 m2 or Palermo with 60 m2)”.

On the other hand, considering the municipalities of AMBA, the greatest interannual variation in house rental prices was registered in Moreno (17.1%), while, in the case of departments, the greatest increase was found in La Plata (53. 3%).

When revealing the interannual variations (that is, with respect to July 2021), the study confirmed a fall in the sale price per m2 of houses in the 6.9%and departments of the 8.2% at the AMBA.

The most expensive apartments according to the Buenos Aires neighborhoods.  In almost all of them, decreases have been registered in recent times, according to UDESA and Mercado Libre
The most expensive apartments according to the Buenos Aires neighborhoods. In almost all of them, decreases have been registered in recent times, according to UDESA and Mercado Libre

Exploiting the granularity of the data by neighborhood, in Buenos Aires the largest year-on-year drop in house sales prices occurred in Villa del Parque, with a variation of 9.6% per square meter.

Value in dollars per m2 of houses for sale in Greater Buenos Aires, here the most sought-after
Value in dollars per m2 of houses for sale in Greater Buenos Aires, here the most sought-after

In the interior of GBA, the municipality that registered the greatest fall in the sale price of houses was Pilar (11.3%); in the case of the departments, the greatest drop occurred in José C. Paz (10%) per square meter.

On the current profitability that is derived from the annual gross return in the real estate market (that is, the income resulting from renting a property for one year on the sale price), in the housing market in Buenos Aires and North, South and West GBA is 3.6%, 6.3%, 4.7% and 3.6%, respectively. In departments, it ranges between 2.5% and 3.8% depending on the area.

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