Property Confiscation and other paranoid concerns

[Hunt99]

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.

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

[Rock Harders]

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

[AllIWantIsLove]

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

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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

[AllIWantIsLove]

Still waiting for a real property confiscation example in the last two centuries.

I know you understand this stuff better than I do, so can you please explain why what Castro did in Cuba is not confiscation of real property? And how about what just happened in Venezuela? I don't know if it's technically confiscation but it seems to me that it amounts to the same thing.

Thanks, Bob

[Rock Harders]

Mongers-

If you were to take a closer look at the property confiscation in Venezuela, or the proposed similar property confiscation in Bolivia, all the lands in question are vast pieces of what those governments decided were "underutilized" potential agricultural lands. I have never heard any mention of confiscated buildings in either Caracas or Santa Cruz de La Sierra. The reason that the governments of Venezuela and Bolivia want to seize these large land tracts is because a system similar to Medieval feudalism exists in which absentee landlordism is prevelant and the Venezuelan / Bolivian peasants do not own the land they till.

If I was Ted Turner and I owned half of Patagonia, I might be concerned that someday the Argentine government might seize my land to be put to better use as either a national park or as agricultural land. IMO, I think the Argentine government should seize 99% of his land and turn it into a giant national park / wildlife refuge.

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. Nevertheless, I do not think buying an apartment / house here is a great investment, you could make greater returns with more liquidity elsewhere. On the other hand, having a nice apartment in a nice area of this city will always have an intrinsic value no matter how bad the economic situation gets. If somehow Argentina straightens itself out (not likely) your apartment value will soar and if it sinks as it habitually does, you will still have the cheap steak, cheap pussy and cheap / relaxing lifestyle.

Suerte,

Dirk Diggler

[Dickhead]

In 1928 Hipolito Yrigoyen got re-elected even though he was already in his 80s and senile. His second wife, Romina, convinced him to expropriate the farmlands adjacent to those of her family in La Rioja province. In this case there was NO compensation. Romina's younger brother was subsequently murdered under mysterious circumstances. Many historians inferred that the neighboring family was responsible.

[Moore]

Why does it have to be real property in order for it to be confiscation? The government's taking away of my business would hurt me much more than their taking away my home.

Because real property, more specifically residential property, seems to have a sacred, special status here. I'm sure that anyone could list 100 examples of very different laws and practices in the business sector of Argentina versus that of USA.

Still waiting for a real property confiscation example in the last two centuries.

[Hunt99]

Does anyone have any historical evidence of Argentina confiscating real property?

Why does it have to be real property in order for it to be confiscation? The government's taking away of my business would hurt me much more than their taking away my home. There is plenty of current expropriation going on in South America, of both real and intangible property. The trend is sharply increasing, and this activity does include Argentina.

Will Kirchner or his successor target foreigners' condos for expropriation? Not as an initial step.

[Dickhead]

In 1889, the Torrealba regime nationalized all the property of the Swiss and Dutch immigrants who lived in northern Chubut, near the border with Rio Negro province, near the present day El Bolson. They made a show of having the property appraised, but the appraisers were all cohorts, and in many cases relatives, of Alejandro Torrealba. Most modern day historians figure the compensation at 15-20 cents on the dollar. These immigrants, who were largely engaged in dairying and cheese manufacture on a subsistence level, returned to Europe but continued to seek additional compensation through local attorneys sympathetic to the cause. Finally, in 1897, a high court packed with judges appointed by the rival successor regime of Reynaldo Espinosa, granted the petitioners additional compensation on the order of 50% of the initial compensation. However, inflation in the interim had been something like 250% , rendering the additional compensation almost moot.

[Moore]

Does anyone have any historical evidence of Argentina confiscating real property?

[Hunt99]

Argentina is not like Venezuela, where it is my understanding that Chavez just took it all the foreigner's property in the last year or two.

The difference is that Venezuela begins with a "V" and Argentina begins with an "A".

[Escapee5150]

All I can say to that is that I spent a long time with some real estate lawyers grilling them about constitutional property rights and related stuff, and I came away satisfied.

SL

Thanks for your due diligence and sharing your grilling of lawyers with us. Since the US Constitution has not meant anything since the 1930's, the rule of law means nothing to me, or anyone else. Oh except lawyers but only while they billing hours. They use the violent force of law to scare you into giving them money for the most part.

I don't go on logic. I go completely by feel. I am simply not smart enough to read all that stuff and don't believe what any government agency or lawyer or CPA tells me.

My feeling is that you are completely safe about owning property. Argentina is not like Venezuela, where it is my understanding that Chavez just took it all the foreigner's property in the last year or two.

I think your property rights are safe, but only in the city. Owning land in a province would be totally different.

I am basing my decision completely on feel. These people have class and style and elegance. I love them.

Another point to keep in mind is this (which I do not take credit for coming up with): Argentina is another country, it is not another planet.

SL

Yes that is correct. The USA is the alternative universe. Our men have been duped into thinking life in the USA is normal. Chump city.

[StrayLight]

People say things on this board that contradict that, and they say it like they know, but don't give any details. When I ask around, I hear, in general, no they have not confiscated property.

All I can say to that is that I spent a long time with some real estate lawyers grilling them about constitutional property rights and related stuff, and I came away satisfied.

Another point to keep in mind is this (which I do not take credit for coming up with): Argentina is another country, it is not another planet.

SL

[Escapee5150]

I also met MCSE tonight. By his posts I really was not expecting too much, but I think that is a language translation / style (and yes math) problem. But after meeting him, he was awesome. A very nice guy, very smart, hard working type, and very very knowledgeable out AR. That is the key right there. He knows this place much better than others that I have met.

I think he is about as likely to find you a good deal as anyone. Probably much better than Saint on the buy side. Saint excels on the sell side, which is where the money is. But in real estate, you make your money when you buy. Plus, I never do what people tell me to. I would have died a long time ago doing that.

I also checked out his apartment in Las Canitas. It was nice. Not my particular style though. I like warmer more focked up stuff, like the old style rickety elevators, or my 100 year old, cool, POS house in Dallas. But if you like cleaner, more modern styling, then it might be cool. The area though was awesome. It is the best area to live in that I have seen in terms of coolness without touristiness. The location was a winner, but it depends on what you want.

[Escapee5150]

Well, in my case, it was in a bank. I had a realtor I trusted through and through (the sister of an Argentinian collegue at work) It was a little spooky, but at some point you need to trust something or someone.

I trust Suzanna at Reynolds Propiedades. A german AR chick. She is cool. I like her, and I trust her and Reynolds Properties.