Foreign Ownership of Land in Argentina

As of now, there are no restrictions on foreign ownership of property in Argentina. Foreigners have the same rights as locals, except for land near a foreign border or coastal strips. There will be some additional paperwork that is required to purchase in bordered or stripped areas, but ownership is not totally impossible. If the purchase of a private island is on your mind, you should obtain specific legal advice concerning the particular island in question.

In order to purchase land in Argentina, you are required to apply for and obtain a CDI number (also known as CUIL Number - "Clave Unico de Indentificacion Laboral", CUIT Number – "Clave Unico de Indentificacion Tributarial"). A CDI number is similar to a tax ID number here in the United States. A CDI number can be obtained either through a lawyer or on your own. To do this on your own you would go to the local police station and give them your passport and address, they will then give you the forms needed. You will have to take these forms to the local tax authorities in Argentina (AFIP) with the related documents in order to get your CDI number. Once the forms are completed, a fee of less than $10.00 US is usually paid. Once complete, you will be able to purchase property in Argentina and pay taxes.

There are twenty three provinces within Argentina. It would be wise to research local laws in those areas, as they may differ between provinces.

Real Estate Agents

Real estate commissions or brokerage fees are usually 3% of the purchase price for both buyers and sellers. Real estate agents in Argentina are different than the ones you'll find in the United States. It is recommended that the only time you should retain one is if you cannot handle buying or selling a property on your own. Real estate fees are paid at the time a deal accepted, finalized and a down payment has been made.

Title Companies

In Argentina a title search is done by an “escribano” or by a notary. It is the notary's responsibility to supervise all real estate transactions, title transfers, and to uncover any problems with the title. Argentina has a cultured and intact title registry. This helps foreigners trace the ownership history of the property in question. You will be notified if there are any problems with your property's title. Notary fees can range anywhere between 1% and 4%. Although the purchase contract is binding within itself under Argentine law, it will not be accepted for registration in the Real Estate Registry unless the terms of transfer have been included in a Title deed.

Financing

Financing in Argentina is a difficult task. Most of the time, financing is not available. If you are able to locate a financing offer, the interest rates are usually astronomical and unaffordable (i.e. not less than 15% per annum, 10 year loans with a down payment as high as 50% of the purchase price). Many recommend getting a loan in your home country and use it to purchase the land in Argentina. The reason financing opportunities are so scarce is that you cannot show proof of income, credit history, and employment within the boundaries of Argentina since their primary residence and income is elsewhere. Local Argentinean banks will not work with you without this information. Foreigners, under most circumstances, must pay 100% cash in advance.

Securing Property

Once you have a found a property of interest, as like in the United States, some form of a deposit is required to show your intent to purchase. In Argentina, this deposit is called a “reserva”, and is held in escrow (earnest money deposit in the United States). Once you make an offer, the seller has the right to decline or accept the proposal. If the seller chooses to decline, the reserva will be refunded to you. If the seller accepts the offer, the offer is formalized and the property is taken off the market. It is customary for the buyer to put a down payment down on the property at this point in time. This down payment, called a “boleto”, is usually about 30% of the purchase price. There are penalties for both the buyer and seller if one chooses to back out of the agreement.

Property Taxes

There is an annual "asset tax" or "personal goods tax" that must be paid if you own property in Argentina. It will usually amount to 1% of the value of your property. The tax return must be prepared by your accountant here in Argentina and submitted on your behalf along with your payment. This tax is assessed to both locals and foreigners.Buenos Aires properties have a stamp tax, “impuesto de sello” associated with them. When transferring the title of a property in this area the fee of 1.25 % is to be paid by both the seller and the buyer to fulfill this tax requirement. This tax rate can differ between provinces. If you are purchasing for the first time, and it is your only purchase, this fee will be waived.

Homeowners Insurance

Homeowners insurance can be purchased from almost any of the major banks in Argentina. You can expect to pay about 50% more in Argentina than what you would pay for similar coverage in the United States. There are many companies out there that can offer real estate related insurance policies in Argentina.

References

http://www.lonelyplanet.com/worldguide/argentina/ http://en.wikipedia.org/wiki/Argentina http://www.privateislandsonline.com/argentina_info.htm http://www.propertyfrontiers.com/research/country-guides/americas/argentina.aspx http://www.justlanded.com/english/Argentina/Tools/Argentina-Guide/Property/Introduction http://www.crossbordermortgages.com/guide/argentina.html http://www.chubb.com http://www.obeliskinvestmentproperty.com/Purchase_Process_Argentina.html