Housing market situation

Buying, Selling, Building, Tax issues, anything regarding real estate or properties in Chile.
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Jamers41
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Re: Housing market situation

Post by Jamers41 » Thu Oct 04, 2018 2:17 pm

Yeah Vitacura, Las Condes, and the like is definitely not your "average Chilean market."

Even if I could afford it, I doubt that's where I'd look for residential property, either for living or as an "investment"........not at today's prices anyway. Commercial office space is something I'm not familiar with so I guess in a parallel universe where I have money to play with, who knows :D

Average Chilean market for me means houses that are within 20% or 25% of 2000 UF, or the roughly the same for apartments. If you're looking at properties with values like those, it's still relatively easy to find stuff you can rent monthly at a rate that covers the mortgage.

Baltimore
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Re: Housing market situation

Post by Baltimore » Thu Oct 04, 2018 3:14 pm

I love this plot by Professor Robert Shiller (Nobel Laureate), it shows inflation adjusted average house prices, population and interest rates in the US.
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ShillerQ42011.jpg

scandinavian
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Re: Housing market situation

Post by scandinavian » Fri Oct 05, 2018 1:43 pm

Jamers41 wrote:
Thu Oct 04, 2018 2:17 pm
Yeah Vitacura, Las Condes, and the like is definitely not your "average Chilean market."
Well, grouping together the Eastern comunas you reach about 750,000 inhabitants or about 10% of Santiago population. Perhaps not average, but not super exclusive either.
Baltimore wrote:
Tue Oct 02, 2018 4:27 pm


I wanted to buy it immediately, but first I decided to hire a real state agent to help me check out the apartment. The agent said that the price was close to the average of similar properties in the area and that apartment looked very good. She did warned me of one thing though. My mortgage was going to be approximately 1.4M pesos per month for 20 years (20% down), however, she said that she had many clients that had similar apartments for rent in Las Condes and that it would be extremely hard to rent it for more than 700K a month if I decided to leave. She told me that the clients she had that tried to ask for more than 800K/month for similar apartments had to wait sometimes for up to a year until someone showed up and made an offer. (BTW, she did not tried to sell or rent me one of her properties after she made that point).
I on the other hand know several persons that are paying +1MM/ month for renting in Las Condes / Vitacura. a quick search on portalinmobiliario shows 2557 listings above that in Las Condes, but I agree that the prices for new apartments in the area seems too high. As other mentions, then if you want to buy and rent out, then the market for small 1-2 bedroom apartments seem more attractive. However, if you buy to live then other factors come in to play. I bought in 2013 and several people advised me not to do it as they were convinced the prices were inflated. Since then prices has gone up anyway. Yes, it might be a bubble, but if you buy to live long-term, then I would still prefer to pay off a mortgage compared to paying rent. And buying in high-demand areas as Las Condes / Vitacura normally are the least affected by down-turns and the quickest to go back up. YMMV

Jamers41
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Re: Housing market situation

Post by Jamers41 » Fri Oct 05, 2018 3:32 pm

scandinavian wrote:
Fri Oct 05, 2018 1:43 pm
Jamers41 wrote:
Thu Oct 04, 2018 2:17 pm
Yeah Vitacura, Las Condes, and the like is definitely not your "average Chilean market."
Well, grouping together the Eastern comunas you reach about 750,000 inhabitants or about 10% of Santiago population. Perhaps not average, but not super exclusive either.
Well assuming the 750k number is correct, it would be just shy of 10% of Santiago, and around 4.5% of Chile. I'm not saying that's nobody or doesn't count for anything, just saying it's not average. And more to the point, I believe the issue the OP encountered with differences in price to buy vs price to rent is not much of an issue in the average housing market here (let's say 1500-3000 UF, which is a large chunk of the market).

You gringos playing the real estate game in the "sector oriente" of Santiago are spoiled, and I'm jealous (envidia sana obviamente) :)

at46
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Re: Housing market situation

Post by at46 » Fri Oct 05, 2018 7:02 pm

Pinera seems to be pretty committed to the Chinese, and that's a good thing. If Santiago were cleaned up a bit, and if the government were to sponsor some sort of Chile promotional campaign in China, they could take the sector oriente into the stratosphere. How many times did you hear the word Chinese out of Bachelet's mouth? :)

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eeuunikkeiexpat
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Re: Housing market situation

Post by eeuunikkeiexpat » Fri Oct 05, 2018 8:24 pm

Chile - future maritime entry point of the Eurasian Belt and Road Initiative into the southern cone of South America. The Bach o' shit admin at least gave a nod to a possible trans-Pacific Internet cable to Chile as backup/bypass to the US controlled one.

I give credit to Chile for knowing how to play the game allowing for long-term prosperity of the people while avoiding Economic Hitman tragedy. Well done Chile elite despite the many weaknesses and problems as compared to other developing nations.
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at46
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Re: Housing market situation

Post by at46 » Fri Oct 05, 2018 10:27 pm

scandinavian wrote:
Fri Oct 05, 2018 1:43 pm
convinced the prices were inflated. Since then prices has gone up anyway. Yes, it might be a bubble, but if you buy to live long-term, then I would still prefer to pay off a mortgage compared to paying rent. And buying in high-demand areas as Las Condes / Vitacura normally are the least affected by down-turns and the quickest to go back up. YMMV
The owner of the apartment I'm currently renting just offered to sell it to me. But for the same price I can get two small rentals that'll pay for themselves in 20 years time while I still have the flexibility to continue living here coz he's not in a hurry to sell, or move wherever I want.

This building is supposed to have greater plusvalia than the rentals. But there are things that can go wrong, like they can put a tower blocking my view or the gastos could suddenly shoot through the roof. With rentals things like these don't matter as much and the cost is borne by the renter anyway.

And so I prefer the rentals paying for themselves while I have the flexibility of moving away unscathed should things deteriorate with this apartment.

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eeuunikkeiexpat
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Re: Housing market situation

Post by eeuunikkeiexpat » Sat Oct 06, 2018 1:14 am

People seem to ignore the effects of a Valpo megaquake...

In the end one's choice/free will/etc.
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fraggle092
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Re: Housing market situation

Post by fraggle092 » Sat Oct 06, 2018 1:22 pm

at46 wrote:
Fri Oct 05, 2018 10:27 pm
But for the same price I can get two small rentals that'll pay for themselves in 20 years time
Sooner or later the SII are going to turn their attention to income from rental property.
Après moi, le déluge

at46
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Re: Housing market situation

Post by at46 » Sat Oct 06, 2018 1:43 pm

eeuunikkeiexpat wrote:
Sat Oct 06, 2018 1:14 am
People seem to ignore the effects of a Valpo megaquake...

In the end one's choice/free will/etc.
Two meters of water falling on the roof of your cardboard house in Vancouver each year wash away your hard earned money just as surely as a big earthquake would here in Chile. Actually, having experienced the 8.6 quake here that had no effect where I am, I think Chile is better for real estate preservation.

at46
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Re: Housing market situation

Post by at46 » Sat Oct 06, 2018 1:54 pm

fraggle092 wrote:
Sat Oct 06, 2018 1:22 pm
at46 wrote:
Fri Oct 05, 2018 10:27 pm
But for the same price I can get two small rentals that'll pay for themselves in 20 years time
Sooner or later the SII are going to turn their attention to income from rental property.
Hey, don't give anybody any ideas, eh? :) Seriously though, I haven't seen much of an increase in rents over the last five years while the prices have gone up anywhere from 50% to 70% where I am. Higher property values mean higher property taxes - and everybody's happy, right? While higher taxes on rental income mean higher rents, and that's only going to play well among socialists, and who wants that?

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fraggle092
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Re: Housing market situation

Post by fraggle092 » Sat Oct 06, 2018 4:58 pm

at46 wrote:
Sat Oct 06, 2018 1:54 pm
Higher property values mean higher property taxes - and everybody's happy, right?
at46 wrote:
Sat Oct 06, 2018 1:54 pm
While higher taxes on rental income mean higher rents, and that's only going to play well among socialists, and who wants that?
Whatever.

Anyway, the trend here has been to try to increase revenue over the years in order to pay to pay for all those electoral promises, plus an ever-increasing number of state and local government employees.

They are already harvesting all the low-hanging fruit, especially when the promised compulsory boleta electronica is introduced, so they are certain to be looking at e-commerce and the informal property rental market sooner or later.
Après moi, le déluge

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