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Rentals: contracts that were signed in August 2020 could suffer an adjustment close to 50%

2021-07-23T19:22:09.649Z

It is the number that arises from the index prepared by the Central Bank taking into account the rise in prices and wages.



Natalia Muscatelli

07/23/2021 16:08

  • Clarín.com

  • Economy

Updated 07/23/2021 4:08 PM

The Rent Law, which has been in force since July last year, put into effect a new formula to adjust rental prices. This index that the Central Bank (BCRA) reports monthly and is used to index contracts debuted this month, and established an increase for locations that began in July of last year, of the order of 40%. However, for the contracts that were signed as of August,

the increase to date is 45% and by the middle of next month it would rise to 48%,

according to estimates in the real estate market.


Until now, the so-called Location Contract Index (ICL) that considers the variation in inflation, according to the Consumer Price Index (CPI) of the INDEC and the average taxable remuneration of stable workers (RIPTE), shows a curve below the inflationary level.

Since today interannual inflation is at 50.2%, according to the latest data released by INDEC and which corresponds to the month of June.

"Although until today, the index shows that the rise in rents that were made in August last year, the rise is 45%,

we estimate that, by mid-August, it will reach 48%, according to the evolution of inflation that we see every day ”

, estimated Marta Liotto, vice president of the Single College of Real Estate Brokers (CUCICBA).

"The rents are at a very high level. This is due to the fact that from the intervention of the State in the market, 

there are fewer and fewer properties and the rents are more expensive," says Liotto.

And he gives an example: "

someone who paid $ 20,000 for a studio apartment, today is already paying 29,000," he said. 

The variation index of the locations is published daily on the Central Bank website.

Those who want to calculate the evolution of their rents

must enter the "Statistics" tab and then where it says "main variables"

.

At the end, you find the rate of change in rents that is used in a formula.

To update the amount to be paid

, the start date of the contract and the initial amount of the contract must be entered.

From the Cabaprop site, of the Buenos Aires government, where there is also a calculator to do it, they give an example: “You want to calculate the update of a rent on 05/05/2021 (the index for that date is 1.29), the date of Start of contract is 07/01/2020 (the index for that date is 1.00) and the initial amount of the contract is $ 10,000.

So: Updated Amount = 10,000 x (1.29 / 1.00) = $ 12900.

That would be the way to calculate it.


Also the Grouped Tenant site has a calculator to set rent increases.

So far this year, rental prices - for new contracts - have accumulated a rise of 27.8% above inflation.

A study by the property portal Zonaprop indicated that the average value of

a two-room apartment and 50 square meters for rent in the City of Buenos Aires is located at $ 39,211 per month.

The same report shows that rental units continue to rise, up 4.4% in July compared to the previous month.

For this reason, from the real estate sector they are promoting several initiatives of changes so that the Law of Rentals.

These modifications basically have to do with the modification in the term of the contracts (instead of 3 years that are two) and with the modification in the annual update term.

It is estimated that, in Argentina, some 2.4 million homes rent.

This represents 18% of the national total.


Look also

Rentals: what are tenants' rights and how to enforce them

The expenses come with adjustments for the increase to those in charge of buildings

Source: clarin

All business articles on 2021-07-23

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