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The construction market is undergoing a transition period. Despite the fact that the cost of construction per square meter in the City of Buenos Aires has exceeded US$1,500 , doubling in just a year and a half, developers and investors are keeping their projects moving forward. Expectations are for a market recovery driven by greater macroeconomic stability, the reopening of the cepo (the currency controls), lower costs, and the return of mortgage loans . According to data collected in the sector, the rise in prices in dollars is explained by accumulated inflation in pesos for materials and labor , while the official exchange rate remained lagging. However, real estate experts assure that the adjustment process has begun to show signs of moderation. Keys to the new scenario Martín Piantoni, CEO of Alton Desarrollos , highlights that some strategic inputs such as iron, metals, and electrical products have begun to reduce their prices thanks to new import conditions and the increased competitiveness of international markets , primarily those of Asian origin. This process, he anticipates, could offset the wage increases necessary to sustain consumption. Overall, the total cost per square meter built, including taxes, reaches US$2,500 , while the sale price in Buenos Aires is around US$2,900 per square meter . According to Beltrán Briones, financial manager of Estudio Kohon , this means that many developments are still being sold below their replacement value , making the used market relatively cheap, although the available stock is increasingly reduced. Direct financing and return of credit With mortgage lending slowly but steadily recovering, some developers are now offering direct financing for up to 10 years as a strategy to attract buyers without waiting for bank financing. Twenty percent of current transactions in Buenos Aires City involve credit, which is reactivating the on-line market. Furthermore, it is anticipated that when divisible mortgages are enabled and banks finance off-plan purchases , activity could multiply. Darío Balan, director of Grupo Uno en Uno , points out that many current transactions are carried out in a chained format: a unit is sold with a deed and reinvested in the construction. Changes in demand and new typologies The trend also shows a shift toward larger apartments , with three or four rooms, outbuildings, and multipurpose spaces. These units, geared toward end users , are replacing the investor-oriented construction that predominated during the credit-poor years. In neighborhoods like Villa Devoto and Belgrano , the price per square meter is between $2,300 and $4,500 , with 30% down payments and fixed or adjustable installment payment plans. Perspectives With inflation falling , wages recovering against the dollar, and greater political predictability, developers maintain that construction will once again position itself as a safe haven and driver of the economy. Construction is more expensive today, but if costs stabilize and financing is consolidated, the market will respond, they conclude. In this context, bricks and mortar retain their appeal as an investment and asset preservation tool , especially given the depletion of finished unit stocks and the prospect of pit prices becoming the new benchmark. |
