Chile Forum

My wife and I are in the process of buying a new house here in Canada and she was shocked to learn that a lot of people make money when they sell their used home.

She was telling me that people in Chile treat used homes just like used cars in most cases.

Meaning that the home depreciates in value and you will never get back what you paid for it. I explained to her that most houses here come with just the house, land in most cases front landscaping, it is what the home owner does after that adds value, complete the landscaping, and add a garage, things like that. She said that many people in Chile will add extras to their property as well but they still won’t get the original purchase price.

First of all has anyone else seen this trend? Or is it just the part of Santiago my wife is from?

Secondly, if this is true then I guess that’s what happens when the market is over saturated with new builds, no one can make a luka.

Jason Roesler

j. Ro wrote:She was telling me that people in Chile treat used homes just like used cars in most cases.

I would go even further and say that used cars hold better value than the houses in Chile..

It has a lot to do with Santiago and the major cities. It really depends on what you buy, and where you buy. Just any land, in any part of a city in Chile may or may not go up in value. For example, just buying a track home in Chile almost certain kiss your investment good-by. What happens are they then build a newer bigger track homes in another area, and that becomes the "place to be". Now, if you build a real home, in a desirable neighborhood, then you will likely see some returns. If you go with the fad however, you will likly get burned in Chile. Places that have been viewed as desirable places to live for generations, will likely continue to be that way. Places that are shake and bake trendy areas, will likely come and go.

There is an article on the front page of http://www.allsouthernchile.com that goes in to some of the reasons.

admin wrote:It has a lot to do with Santiago and the major cities. It really depends on what you buy, and where you buy. Just any land, in any part of a city in Chile may or may not go up in value.

I'm disturbed by what appears to be no zoning laws to protect homeowners' investment. Anyone can buy a house, turn it into a late-night bar, and the people with adjacent houses are screwed.

I've seen a lot of this in Maipu. Near my wife's family's house someone who owns a few colegios bought a house with a long lot, and built a 2-story colegio. The 8-12 people with adjacent houses are worse off because of all the noise and traffic.

I walked to Jumbo the other day, and noticed a house that had been converted into a bar. The neighbor was trying to sell.

That would make me nervous about buying a house. As far as I can tell, there's no guarantee that a neighborhood will remain residential. I think I'd rather get a deal on the house next to a bar, and hope the bar goes away someday than to buy a house next to residences and never know if they'll be converted into auto-repair garages, etc.

Mark