Within sharp increases throughout the country’s economy, tenants who signed contracts under the Rental Law from 2020 –later repealed by the DNU current Government – will have to pay a record increase in the month of May.
Contracts that are subject to an annual update through the Index for Lease Contracts (ICL) will experience an increase of 221%, resulting in, for example, tenants who paid $100,000 until this month, they have to pay approximately $321,000 until April 2025.
Furthermore, in the case of those who paid $200,000 until now, they will have to adjust to a new amount of $642,000also until April of next year.
This adjustment consists of multiplying the amount they paid a year ago by 3.21; The resulting value is the locative value that will govern from May 2024 to April 2025, inclusive.
The ICL created by the Rental Law in 2020, combines the monthly variations of the Consumer Price Index (CPI) and that of the Average Taxable Remuneration of Stable Workers (Ripte) in equal parts.
The loss of purchasing power in relation to inflation
Due to the constant escalation of inflation, the ICL – prepared by the Central Bank – has been rising steadily, although it is still lower than inflation.
For next May, the annualized ICL is 221%, while the annualized inflation by CPI as of March 2024 was 287.9%, which shows a significant gap between the increase in the ICL and inflation.
What this indicates is that salaries They have lost purchasing power in relation to average inflation.
To calculate the new rental amounts, according to the corresponding adjustment moment, The amount prior to the adjustment must be multiplied by the corresponding coefficient.
Greater supply, but high costs
Although in some neighborhoods of the city of Buenos Aires the prices of three- and four-room apartments began to decrease for the new contracts after the DNU, the initial values are still high.
This makes the economic situation difficult of households that must face high costs to maintain their home.
The rental supply continues to increase, with a growth of 134% since the beginning of the year, according to data from the Statistical Observatory Table of the Real Estate Professional Association.
It is estimated that there are currently about 15,000 properties available in various specialized portals, although 50% of the options are offered in dollars, there are now apartments in almost all neighborhoods of CABA when last November there was a shortage.
Even in areas like Villa Soldati, where a 40 m2 studio apartment in the Olympic Village area is rented for $200,000 per month, and in Parque Avellaneda, a brand new two-bedroom apartment at 3,700 General Eugenio Garzón is worth $380,000 per month.
Source: Ambito
