Pros-Cons of Apartment Ownership From Experience
I promised a report on my experience of apartment ownership after my deal is done. Well, the deal is closed the money is in the bank.
I got a lot of help from people on this board as far as mongering and other things are concerned but as far as property ownership, I got a lot of misinformation from supposedly experts on here. I try to give an overall description of what I did and you guys can pm for any info that you want to ask me and I will give you my thoughts from EXPERIENCE since I have done the whole purchase and sale process to completion.
I was interested about a couple years ago in investing in an apt in BA as I frequented here many times and naturally enjoyed it. At that time Saint was starting his biz and I bit into it and paid him $400 us to find an apartment for me. After searching for me for about 2 mos or so he finds one apartment in Recoleta which says is a penthouse as it is on the top floor. He sends me pics and I say ok what the hell it looks good and he tells me it doesn't need much work but just painting. He quotes me some figure that honestly I don't remember but seemed high to me.
I am a commercial real estate broker in Los Angeles for about 30 years so I know real estate. (at least in the US) but not in BA. Anyways, I send Saint the deposit and then I send him about 30% down so this secures the building for me and the seller and make arrangements to go see the place. My friend and I go there and I'm shocked to see what a piece of shit this place is. Now I do fixer uppers in the states once in a while but Saint's idea of a little work is a lot different than my perception as I have more experience than him at this point. I see all kind of potential problems but what can I do but ask questions. There is an open air space to the top floor roof balcony that is open to everyone and I ask is this legal. Naturally the owner says oh yes as here is the paperwork. Well the paperwork is ony an application and not an approval.
Now Saint is only a go between with myself and the piece of shit company Reynold Properties. I asked them about legal aspects and they are completely worthless and are vague about everything. Anyways, in the meantime the doorman is telling me the owner has many problems with the building and that she has done illegal things. Now everyone is lying about eveything and who knows whos telling the truth. Long story short I naturally close the deal. According to Saint it is the buyers responsibilities to pay the 2 1-2 % commission to the broker. Later I found out it is not set in stone and anyone can negotiate the commission.
At this point I agree, I am stupid and should have bailed as usually my gut is always right on real estate deals. At the time, cash was needed to close the deal. Now Saint promised me that don't worry we wll have an armed guard escort you to the closing. I'm carrying around with me $40k and I'm not comfortable. I am counting on Saint to take care of me as he is not big time yet and is trying to build his company. I feeling really insecure when he tells me the day before the closing he doesn't have time for me and go with the brokers. Plus there are no armed guards for me. Just walk 4 blocks and nobody will bother you. This is bullshit and bad business anyway you look at it and I would never do this to a client. If Saint reads this, keeping your word is something that shouldn't be special so that doesn't make you speical but how you treat clients is what makes a good business person.
Just to let everyone know that even till today, I have yet met the mysterious Saint. After writing my bad experience on here, Saint pm and told me he would buy the apartment as promised if I wasn't happy with it. And yes he did perform as promised but the way he handled me from the beginning is bad business and how could I do business and trust anyone who doesn't even have the time to meet me face to face. I went to his office before the closing of my deal last week and he was sitting in his office and didn't even have the courtesy to step out for one second to greet me and tells his secretary to relay info to me. BAD ETIQUETTE, Saint.
Now my experience after I purchased, was horrendous. Trying to find someone to manage your apartment is impossible. I went through 2 or 3 agencies and they have excuses on why they can't handle it and says you have to do this and that to rent it. After I saw the apartment I'm renting today from BYTargentina, my apartment is 10 times better and was more than ready to rent. Anyways, I have the building threatening me to fix the apartment to the original condition which means closing off the balcony and a bunch of other stuff. They then tell me that there is plumbing and roofing damage that has to be paid for by me because the other owner did not pay.
Well, before I closed my deal last week the Esc. does a check with the building adm and sees if any outstanding bills are there. Well they come up with a bill of $400 or so which I have to pay. What happened to the responsibility of the previous owner when I purchased the building. I was made responsibile for the seller and had to pay her costs. Get the picture. Its alway stick it to the foreigner as they have money. Saint tells me you should have fought it. Hell I hired an attorney and she says you have to fix it. Its easy to say you could fight it, but if you are not there you cannot.
This goes on for 1 1-2 years. Everytime I turn around they are blaming the construction causing roof leaks, plumbing leaks, painting problems etc. Everyone tells me you can't do anything.
Finally, El Flaco on this board calls me and tells me he can rent my apt and take care of it for me. But he tells me you apartment is too ugly and furniture is no good. My furniture is modern and was purchased by an interior decorator that I hired that has apartment in magazines she designed so Flaco is full of shit. All he does is complain that my apt needs this and that and its ugly. I'm stuck as I don't have anyone else to manage it. He rented it 1 time for $300 a month to a friend of his. Now I just went to the apartment last week and supposedly, that was the only time it was rented but the furniture and everything looked lived in for longer than a month.
Anyways, I know Flaco will pop off something about this and that but I could give a flying shit. When Saint said he would buy the apt back he sends an architect over to my apt and there is a guy staying there. Flaco says oh he is just waiting for someone to comeback from the store. What a fucking bullshit liar. The guy admitted he only stayed there sometimes.
Oh yeah, Flaco where is my DVD player?
Saint from here does come through as promised. He does have a very efficient team and they do a good job. If he had this team when I purchased I think I would have been ok but unfortunately, I was a guinea pig for his business venture. As far as the selling portion, there are costs that you need to know about. I asked around about property taxes with some of you that actually own property and you told me there wasn't any. Well, please be aware that there is a 1 1-2% tax per year on the value of your apartment and if you don't pay it, when yo go to sell you will be thoroughly surprised. Keep in mind it will cost you $750 us for an accountant to do the figures to pay the tax. Now I don't know if that is standard but that is what Saint and his accountant charged me for each year. Saint picked up half the tab for one of the years. Also closing costs on selling, there is about $500 us charge to do the closing in the bank or office that Saint didn't know about. Other closing cost totaled about $2,700 which included taxes and acct fees.
I know I jumped all over but I think everyone got the jeist of this and can pm for any specific info.
My suggestion is don't buy here as no one is dependable and lots of people lie and take advantage of foreigners. You should live here if you are going to buy and do not leave it to anyone else even family or friends cuz if something happens you will not find anyone to replace them easily.
This does not make sense.
[QUOTE=Exon123]
Real Estate in Buenos Aires has no "liquidaty", Inflation is rampand, the government is "Questionable" and once your in how do you get out?
Exon[/QUOTE]If inflation is rampant, then owning property is a hedge against it. Apartments are quoted in US dollars and are constantly increasing in value because of local inflation and foreign demand. The rate of exchange is fixed. Why could you not get out, and that at a profit?
I would agree with your other comments.
Great posts, you too exon.
#1036,
Thanks for posting that report. Not many are willing to talk about the problems they have with owning property. I buy and sell single family houses here in Las Vegas so I can understand the problems. Also about owning out of state or out of the country property. There is always a risk-reward to any investment and it is up the the person involved if it worth it to invest. Exon's point about the state of the country for me should always be considered. Today may look like yesterday, but may not look like tomorrow. Swings in currency are not uncommon. Thailand just strengthened against the US$ 42 to 35. Some think it will hurt tourism, time will tell. Good luck to all who take the plunge. As I said information is power. Thanks to all for the posts.
Puma