Property in Latin America
The demand for real estate in Latin America, as both an investment and a lifestyle choice, continues to grow. While property markets in more traditional ‘second-home’ destinations such as Spain and the Caribbean are struggling, most markets in Central and South America are still emerging, offering the potential of large returns.
Argentina, currently recognised as one of South America’s most popular destinations, is a great place for retirees and investors alike, with a relaxed pace of life, relatively low cost of living and thriving luxury property market. Argentina also benefits from a friendly and welcoming local population.
In neighbouring Brazil, the government has recognised the huge capacity for growth in domestic tourism and real estate markets, embarking on a £2.2 billion programme to modernise ports and airports nationwide, such as in the growing tourist hotspot of Natal. President Luiz Inácio Lula da Silva is aiming to have works completed in time for the 2016 Olympics, and indeed much of the new infrastructure will be in place for the 2014 FIFA World Cup. The prospect of Brazil hosting these two massive sporting events is encouraging a shift from lifestyle property-buying to larger-scale investment, and some anticipate growth of around 30 per cent over the next five years.
Uruguay is an equally attractive proposition. By combining a European feel with South American culture, it attracts many European buyers looking for something a little different. Uruguay is the fifth wealthiest country in Latin America, with a per capita GDP of $10,900; it is also the safest, and boasts a very good healthcare system. The seaside resort of Punta del Este, located on Uruguay’s southern tip, is these days known as a playground for the international rich.
By contrast, Chile is South America’s hidden gem in that it has yet to receive much attention from international buyers. It boasts the highest GDP per capita in Latin America, and was this year ranked 10th in the world in terms of economic freedom. Meanwhile tourism has begun to pick up, and is expected to grow by around 12 per cent this year.
Peru remains largely untouched by international investors, keeping property prices low. However, impressive economic growth (9.8 per cent in 2008 alone), an upsurge in tourism and pro-investment policies – Peru’s strongly democratic government has deregulated international money transfers and allowed for foreign ownership of real property – are expected to drive up property prices in future.
Nicaragua is also trying to attract foreign investment through government incentives. Real estate investment hotspots include Granada, a colonial town on the bank of Lake Nicaragua, and San Juan del Sur, a fishing village located just north of Costa Rica on the Pacific Ocean. Elsewhere, most of the country is awaiting significant advancements in infrastructure, allowing investors to buy property in almost any price range.
The overall feeling is that, for intrepid investors, Latin America offers something that the more talked-about countries once did – a great lifestyle and high returns.
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