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Buying in Argentina step-by-step

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If you are considering buying a property or farm in Argentina but are unsure where to start then I am the person to help. As an Argentinian lawyer based in London, I can guide you through the daunting prospect of buying a property abroad via a comprehensive service ranging from advice on where to buy to legal technicalities such as how to transfer money and complete all the documentation you need. Together with the right contacts and teams on hand, this means you can have full confidence in the smooth running of your Argentinian property purchase so allowing you to sit back and take advantage of the great living standards – as well as investment opportunities – this beautiful country offers.

Why Argentina?

Argentina is not just a country with stunning scenery and a wonderful climate but one that offers incredible value for money for the overseas property buyer. As a country covering more than one million square miles the land is diverse, ranging from beautiful beaches in the east to mountains and world famous vineyards in the west and south. For farmers, the rich agricultural land of the pampa húmeda provides some of the most fertile soil on earth. At the moment prices are cheap for investors but they are rising.

Bureaucracy

There are no restrictions on foreign ownership of real estate. The Argentine constitution grants foreigners the same rights to work, conduct business, buy, own, and sell property as it does to Argentine nationals.

Buyers must obtain a:

  • —CDI tax registration number from the AFIP to complete their purchase, as well as having a
  • —representative appointed if they do not become resident in order to pay property tax for them.
    Also, every real estate purchase in Argentina must be
  • —registered through a notary public or escribano who specializes in dealing with real estate transactions. This is one of the reasons that land title is generally secure and trouble-free in Argentina, and can be expected to cost between one percent and two and a half per cent of the purchase price.
    The escribano is also responsible for registering the property sale and transfer of ownership with the authorities.

Property in Argentina is titled, and the country has a sophisticated land registry, through which you can easily trace the ownership of property.

Steps

Step 1: Offer

You make your offer stating price, closing date, name of notary public selected, and special conditions. This is accompanied by a deposit, which should be returned and doubled if the owner backs out of the deal before closing date. Be sure you read an updated  folio real which states the current owner, and a proof of payment of the last council tax and Real Estate tax (Impuesto Inmobiliario)

Step 2: Boleto

This is an intermediary dispensable step, usually taking place within the first 15 days following acceptance of an offer, allowing owners to receive between 30% and 50% of the purchase price and, thus, enabling the seller to secure a replacement property for the one to be sold.

Important: The documents recommended to see before signing any boleto or escritura are the Informe de dominio and the Informe de Inhibiciones personales.

The Informe de dominio, issued by the Registro de la Propiedad Inmueble, states the exact dimensions of the premises, who the actual owner is and if there are unpaid mortgage(s) or seizures. The Informe de Inhibiciones personales, issued by the same Registro, states if the owner is allowed to sell.

 

Step 3: Escritura

This is the actual closing date when all parties get together to sign the official transfer of deed. Prior to this situation, the acting notary public must be in possession of the old title deed, have performed the necessary title searches, received a surveyor’s report on the property and verified debts, liens, encumbrances, etc. When buyer and seller go straight toescritura, 100% of the proceeds are delivered at this time or a transfer to a foreign bank account is set up and verified at a second meeting.

It is important to note that the payment required for the escritura is not required to be made in pesos. In fact, most owners will accept only U.S. dollar bills or transfers to their accounts held abroad. It is not required that the buyer be personally present to sign the transfer of deed. The buyer may leave a power of attorney to a third party to sign on his behalf.

Taxes and maintenance payments

Income tax for those who are planning to rent their property out runs at a flat rate of 21 per cent of the gross income earned from the property. As a foreigner buying property in Argentina, you must also pay a Personal Asset (1.25%) and Property tax (1.20% for rural properties, 1.35% for sub-rural and sub-urban properties, and 1.50% for urban properties), and you’ll need y to arrange for this to be paid on your behalf by an Argentine national at the AFIP (tax office).
There is a maintenance cost payable monthly on all properties in Argentina, which can be passed on to long-term tenants. A council tax (ABL) is also levied on property to cover street lighting, garbage collection and maintenance costs, and amounts to around half of one per cent of the property value.

Overall costs

You should budget for buying costs to come in at around eight per cent of the purchase price of the property in Argentina. This covers the legal fees of the escribano, property registration, stamp costs and the agent’s fees, which are shared between the buyer and the seller.

Distribution of costs

Transaction cost Who pays?
Real Estate Agent’s fee 3-4% + 21% VAT Buyer
Stamp Duty 1-1.25%1-1.25% BuyerSeller
Notary fees 1-2% Buyer
Registration fee 0.10% Buyer
Transfer tax 3% Seller
Costs paid by Buyer 5.73-7.69%
Costs paid by Seller 4-4.25%