One of the cheapest major cities for Latin America real estate is Quito, according to a recent study, with the average price per square meter in the Ecuadorian capital just $1,225.
The study included 14 major cities from nine countries around the region, with Colombia’s capital Bogota coming out as the second-cheapest thanks to average real estate prices of $1,239 per square meter (all figures in USD).
The most expensive Latin America real estate was found in Chilean capital Santiago, where average prices are reportedly $3,441 per square meter – significantly more than second-placed Montevideo, where average prices are $2,923 per square meter.
SEE ALSO: How to Buy Property in Bogota
That makes property in the Uruguayan capital more than $300 per square meter more expensive than Argentina’s much larger capital Buenos Aires, located a short boat ride across the River Plate estuary.
As recently as March 2019, Buenos Aires had the most expensive real estate in Latin America, however an economic downturn in the South American country has seen the Argentinian peso lose more than half its value compared to the US dollar since then.
The results are taken from the latest edition of Latin America Real Estate Survey (RIAL) published twice-yearly since 2017 by the Finance Research Center at Argentina’s Torcuato di Tella University, which states that “[in] Latin America, residential properties inhabited by its middle and upper-middle classes are also often an important vehicle for long-term savings for such social sectors.”
According to the study’s authors, the results are based on the sale value of a square meter of a typical housing unit in neighbourhoods with similar characteristics, and based on “a methodology that meets generally accepted international standards.”
The authors looked at apartments advertised for sale in each city, with parameters that included an indoor space of between 20 and 100 square meters, one or two bedrooms (studio apartments were excluded), and a value of between $10,000 and $300,000.
The results for the September 2021 study, which were published in November, showed that prices had fallen overall by around 1% compared to the previous study six months earlier – a figure that stood at 4.4% when adjusted for inflation, according to El Telegrafo.
Latin America real estate prices show decline in many markets
The figures from historic editions of the RIAL show an overall general decline in Latin America real estate value, with eight out of the 14 cities included seeing prices drop since the original September 2017 editiond of the study, and an overall 0.5% decline across all cities.
This is the second period in a row in which Quito has had the cheapest Latin America real estate recorded by the RIAL, with Bogota having had the lowest prices one year before the latest study. The Ecuadorian capital also had the lowest priced real estate between March 2018 and March 2019, before which the central Mexican city of Gudalajara had the lowest prices.
SEE ALSO: How to Buy Property in Ecuador
Note that Venezuela’s capital Caracas was included in the first three editions of the study, and was consistently the cheapest due to the country’s economic turmoil and massive inflation. However, since the September 2018 edition, it has not been included. For the purpose of this article, it has been excluded entirely.
While Guadalajara was the cheapest city for Latin America real estate other than Caracas for the first two editions, after September 2017 it saw prices rise and since the publication of the September 2019 edition, the city has seen prices soar by nearly 50% per square meter. That despite the fact that prices in the other two Mexican cities included in the study are lower now than they were in September 2019.
Nevertheless, since the original September 2017 edition of the RIAL, it is the three Mexican cities that have seen the greatest overall rise in real estate values, with prices rising 28% in Mexico City and 32% in Monterrey. Meanwhile, Guadalajara’s prices rose 47.5% across the entire period.
The only other cities to have seen an increase in prices since the first RIAL are Santiago (5.3%), Peru’s capital Lima (2.8%) and Montevideo (0.4%).
However, in the majority of cities, prices have actually fallen, with the biggest declines seen in the Brazilian cities of Rio de Janeiro (-43%) and Sao Paulo (-23%). Other significant declines have been seen in Panama City (-16.7%), Bogota (-8.4%) and Quito (-11.6%).
Notably, the Argentinian city of Cordoba saw significant decline (-15%) despíte much smaller declines in the cities of Rosario (-4.2%) and Buenos Aires (-2.2%), with all three cities being within 700 kilometers of each other.
While these Latin America real estate results will obviously be affected by the rising value of the US dollar — especially since the onset of the global pandemic in the first part of 2020 — it is worth noting that both Ecuador and Panama are two of Latin America’s dollarized economies, meaning that no fluctuations seen there can be attributed to shifts in currency rates.
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