Property Confiscation and other paranoid concerns

Dirk,

As usual you make a lot of sense. But were Argentina to confiscate Ted's property in Patagonia, wouldn't that lower ALL real estate values? Wouldn't there suddenly be many, many fewer foreign buyers in the marked?

Bob

[blue]================================================

Hi AllIWantisLove,

Thanks for breathing a bit of sanity into this discussion.

The answer to your question is YES! Of course! If the government of any country starts confiscating foreign-owned property in their country, the value of all real estate in the country would plummet. This would be especially true here in Argentina where foreigners are the ones propping up the real estate market by buying property. Saint's purchases alone have probably added 10% to all the property values in Capital Federal.

Okay, I was just kidding about that last observation, although that wouldn't stop Saint from proclaiming that he alone is responsible for adding a billion dollars of value to the Argentine economy.

Anyway, the people that would be hardest hit in any government confiscation scheme would be local owners, who still own 90% of the country's property. BTW, "local owners" I am sure includes every major political player in Argentina.

Think of it like this: Any time some back-woods Argentine politician starts spouting of slogans like "Argentine lands for Argentinos", his campaign contributors and his constituents quickly pull him aside and tell him the equivalent of "Shut the fuck up you idiot. I've got my property for sale and the only buyers with money are the foreigners."

Thanks,

Jackson[/blue]

AllIWantIsLove-

I think that it would depend on the exact circumstances of the nature of the confiscation of Ted Turner's land. For example, if the Argentine government declared that they would be distributing the land to peasants and landless villa miseria dwellers, to be followed by more land re-distribution, real estate values may take a big hit in some regions / markets. However, if the Argentine government announced that they were turning the entirety of Turner's land into a Patagonian national park / wildlife refuge for the sake of the environment, I doubt that prices of apartments in Recoleta would budge one bit.

Suerte,

Dirk Diggler

[QUOTE=Dirk Diggler]

The point here is that it is pretty absurd to think that the Argentine government is going to confiscate your 2 bedroom apartment in Recoleta as part of some xenophobic nationalist restructuring. There is simply no incentive for the Argentine governement to do this. [/QUOTE]You're right, Dirk. Such a thing could never happen.

For example, I enjoy jetting down and spending weekends in my two-bedroom apartment in Havana. It has a great view of the ocean. The government down there has no incentive to take it away from me. There have been some rumors that the government was going to start expropriating the underutilized sugar cane plantations which are in a neo-fedual state, and then move on to the cigar factories, but I bet those are also nothing more than lies spread by the Bush Administration.

But even if the Cuban government did take those assets away from the multinationals that abuse the workers and peasants, there's no way they'd touch my apartment, since I never exploited anybody. More importantly, property rights are sacred and enshrined in the Cuban Constitution. In five hundred years of history, there has never been any land expropriation in all of Cuba.

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Hi Hunt99,

With all due respect, there's a world of difference between modern day Argentina and modern day Cuba, a difference so great that I think it defies comparison.

Thanks,

Jackson[/blue]

Folks, get down to a bit of realism.

Everything can happen, and property confiscations happened in many places of the world. They happened in the early 50's in the eastern part of my country, like in many countries that turned communist in the aftermath of WW2. It happened in Cuba. And in many countries, it has been reversed, and most property given back to their owners, for example in East Germany.

And it can happen in Argentina, Spain, Germany, and the U. S. Of A.

The question is, how likely is it. At this time, I don't see the threat of a hardcore communist revolution anywhere on the world. This idea seems to have found it's place in the "errors of history" dumpster. The superpower without which Castro could never have got into power ceased to exist. And anything short of a real revolution will not change the structures of a society so much that Jackson's remark does not hold anymore.

With every investment, you have to assess your risks and benefits. When buying stock in any company, you basically bet your money on the expectation that the company's management does not fuck up big time within the next half year (and that happened more often than property confiscations) and that there still is a market for the co's products in a few years. I, and that is my personal opinion, consider the risk of property getting confiscated in Argentina low enough to be neglected.

Just my 2 unconfiscated cents,

El Alemán

Also I outrightly fabricated all that shit I wrote two nights ago and I've just been waiting for someone to call me on it. Sounded pretty good though, huh?

I don't post anymore to the ISG boards but a few of my friends that read this section told me about this thread so I thought I'd share my comments.

I really got a good laugh from Jackson's post! Ha, ha. Funny guy. No not billions but tens of millions of dollars. Yes. I'm not sure how much my buying has raised property values but let's just say it's a fact that I was one of the largest buyers of residential real estate the past two years and I don't see any slowdown in sight now that I'm working for hedge funds and investment funds buying tens of millions of dollars of property.

For those of you paranoid, just don't purchase here. It's that simple. From my experience, the people doing the most complaining probably couldn't buy a nice property here anyway as it's all cash.

I'm not posting to sell anything. I'm only posting facts. El Aleman makes excellent points. There is risk in ANY investment. For those of you that think there is no risk in the USA, you are sadly mistaken. ALL investments have a risk. The way I look at it, I would rather own an apartment in Recoleta instead of 300 shares of Google.

The La Nacion had an article on May 13, 2006 that told of how properties in good areas of the city have gone up 30% in value in the past year. I doubt that those that purchased are too worried about the same things you are worried about. The properties I purchased have increased tremendously in value and have provided an unbelievable amount of cash flow via rentals. I've received unsolicited offers on several of the properties I own. Some for as much as 70% more than I paid for it just less than 2 years ago. I'm not buying to flip and make a quick profit (although I have sold one that I got a great offer on and was too good to pass up and I will still manage it and make profits with no risk)

The point is this. If you can't stomache the risk then don't buy here. Life is full of risks. Investing in South America is not for everyone.

One thing is for certain and undeniable. I've been 100% spot on target on Argentina on 1) real estate; 2) tourism and 3) the exchange rate the past several years. Go back and read the posts and I think you will see that is the truth.

Good luck all.

P.S. Oh yeah...there are a lot of folks a lot smarter than random guys on WSG that post that are investing in Argentina. These include some of the biggest financial brains and most successful people and companies in the world. That in itself doesn't mean anything but I only post it to remind you all that it's not just random mom and pop types buying here. Remember, purchases here for foreigners here are ALL 100% cash so these aren't pikers.....

Saint is without a doubt the most intelligent, perspicacious, handsome, virile individual on the face of the earth. Just an unbelievable, tremendous, all-around individual. Hell of a shortstop too.

Thanks for the compliments Dickhead.:P.

Hey, like me or hate me. My posts on many, many message boards over the past several years have been beneficial and accurate.

[QUOTE=Dickhead]Saint is without a doubt the most intelligent, perspicacious, handsome, virile individual on the face of the earth. Just an unbelievable, tremendous, all-around individual. Hell of a shortstop too.[/QUOTE]I didn't know he was Venezuelean.

[I]BsAs has the most psychologists per capita in the world. I'd include that fact in my sales pitch to foreign clients if I were a local real estate tycoon. Personally vouching for their expertise would be even more convincing during a 10 million dollar negotiation (hedge fund and REIT clients excluded).[/i]

Diagnosis:
[u]Pathological narcissism[/u] is a pattern of thinking and behaving in adolescence and adulthood, which involves [b]infatuation and obsession with one's self[/b] to the exclusion of others. It manifests in the [b]chronic pursuit of attention[/b], in social dominance and personal ambition, [red][b]bragging[/b][/red], insensitivity to others, lack of empathy and/or excessive dependence on others to meet his/her responsibilities in daily living and thinking. [u]Pathological narcissism[/u] is at the core of the [u]narcissistic personality disorder[/u].

[u]Narcissistic personality disorder (NPD)[/u] is a form of [u]pathological narcissism[/u] characterized by an [b]all-pervasive pattern of grandiosity[/b] (in fantasy or behavior), [b]the need for excessive admiration[/b] or adulation.

[u]Narcissistic adults[/u] are widely thought to be the result of bitter disappointment, of radical disillusionment in the significant others in their infancy.

Please seek professional help immediately.

[QUOTE=El Aleman]

The superpower without which Castro could never have got into power ceased to exist.

El Alemán[/QUOTE]I seem to remember the good old USA putting Castro into power (along with the two dictators before him!) Did the US cease to exist?

I think you know which one I mean. Should my historical knowledge leave room for improvement I kindly ask to excuse the fact and blame it to the circumstance that I got my education in a different part of the world as you.

El Alemán

[QUOTE=El Aleman]I think you know which one I mean. Should my historical knowledge leave room for improvement I kindly ask to excuse the fact and blame it to the circumstance that I got my education in a different part of the world as you.

El Alemán[/QUOTE]No problem, most Americans don't realise we put Castro into power!

[QUOTE=Saint]I don't post anymore to the ISG boards but a few of my friends that read this section told me about this thread so I thought I'd share my comments.

I really got a good laugh from Jackson's post! Ha, ha. Funny guy. No not billions but tens of millions of dollars. Yes. I'm not sure how much my buying has raised property values but let's just say it's a fact that I was one of the largest buyers of residential real estate the past two years and I don't see any slowdown in sight now that I'm working for hedge funds and investment funds buying tens of millions of dollars of property.

For those of you paranoid, just don't purchase here. It's that simple. From my experience, the people doing the most complaining probably couldn't buy a nice property here anyway as it's all cash.

I'm not posting to sell anything. I'm only posting facts. El Aleman makes excellent points. There is risk in ANY investment. For those of you that think there is no risk in the USA, you are sadly mistaken. ALL investments have a risk. The way I look at it, I would rather own an apartment in Recoleta instead of 300 shares of Google.

The La Nacion had an article on May 13, 2006 that told of how properties in good areas of the city have gone up 30% in value in the past year. I doubt that those that purchased are too worried about the same things you are worried about. The properties I purchased have increased tremendously in value and have provided an unbelievable amount of cash flow via rentals. I've received unsolicited offers on several of the properties I own. Some for as much as 70% more than I paid for it just less than 2 years ago. I'm not buying to flip and make a quick profit (although I have sold one that I got a great offer on and was too good to pass up and I will still manage it and make profits with no risk)

The point is this. If you can't stomache the risk then don't buy here. Life is full of risks. Investing in South America is not for everyone.

One thing is for certain and undeniable. I've been 100% spot on target on Argentina on 1) real estate; 2) tourism and 3) the exchange rate the past several years. Go back and read the posts and I think you will see that is the truth.

Good luck all.

P. S. Oh yeah. There are a lot of folks a lot smarter than random guys on WSG that post that are investing in Argentina. These include some of the biggest financial brains and most successful people and companies in the world. That in itself doesn't mean anything but I only post it to remind you all that it's not just random mom and pop types buying here. Remember, purchases here for foreigners here are ALL 100% cash so these aren't pikers.[/QUOTE]How'd that work out for ya?

DrakeCapital.

Your comment below regarding Saint's real estate wisdom is priceless.

Exon