When we first left Florida for Buenos Aires the real estate bubble had just burst… or, maybe it had popped months earlier, but people were only then realizing it… Now it continues to slide. Many of the bright red ‘for sale’ signs have faded to a pink in the Florida sun…

Most people we know are pretty savvy real estate investors (or savvy enough not to be real estate investors at that time). They weren’t really effected too much by this, but we’ve heard of some people in serious trouble… who bought way more than they could possibly afford. When the market went south, these people were caught with massive mortgage payments and negative equity.

The Buenos Aires market is humming with little or no credit. That was the problem with much of the US boom is that it was funded by creative and risky mortgages. So, there’s a theory among real estate speculators in BA, that when the Argentine banks do offer mortgages (and they’re supposed to in the near future) that BA real estate will really take off.

The BA market is still cheap relative to other major world cities… It’s this perceived value that’s driving the market. However, as prices continue to rise, they’ll reach a point when this value no longer exists in the eyes of buyers (other than the speculators) then price increases will slow, stop, or fall… As we expats and Portenos enjoy this boom, we need to keep our eyes out for that time. It may well be a long way off, but you never know…