When Franco Morán, 27, called to renew the contract for the studio apartment in San Telmo he had been renting for a year, his realtor told him he had less than a month to vacate it: the landlord had decided to put it on accommodation site Booking.com, and was getting a lot of interest.
“They are currently renting it out for three months to a Spanish man who pays US$800 a month,” Morán told the Herald. “I was paying AR$60,000 [US$300 at the official rate, US$168 at the MEP rate] with utilities included.”
Landlords are increasingly renting furnished apartments on short-term contracts to locals and visitors alike. This type of contract is less regulated and has more flexible conditions for owners than the three-year contracts established by the Rental Law. Morán, for example, signed two six-month contracts until his landlord decided to kick him out with almost no warning.
Speaking from an apartment he had to find in just days, Morán knows he is not alone. Like in many other cities, temporary rentals — destined for tourists, digital nomads, workers, students and affluent locals through websites like Airbnb and Booking.com— are changing the real estate market and making it increasingly difficult for locals to find an apartment in Buenos Aires.
“There are around 70,000 short-term rentals listed in Buenos Aires,” Gervasio Muñoz, president of the National Federation of Tenants, told the Herald. He said that the Federation had calculated that there are approximately 20,000 such listings on Airbnb and another 50,000 on websites or apps like MercadoLibre, Facebook, Argenprop, Zonaprop, and Booking.com.
The 2020 Rental Law mandates that tenants must be offered three-year leases with some exceptions, including transient locals (students or workers, for example) and tourists.
Temporary rentals are supposed to be listed in the Temporary Rentals Registry if they are for tourists, but only 347 apartments are officially registered.
Sources in the City’s Tourism Entity told the Herald that implementation of the Temporary Rentals Law was stymied by the pandemic — it was passed in December 2019. They suspect owners either don’t know about it or don’t want to register because they mistakenly believe it involves paying an extra tax.
Either way, short-term contracts offer less protection than the Rental Law and demand less from the landlords. That prompts some to “disguise” traditional rentals by making tenants sign an infinite loop of short contracts, according to Muñoz.
According to Invertire, a website that automatically monitors the real-estate market in Buenos Aires, Palermo, Recoleta and San Nicolás are the neighborhoods with the most temporary rentals, which surged by 46% compared to last year.
“That pushes up traditional rents because the market wants to maximize its profit,” said Muñoz, who adds that the supply of apartments available for long-term leases has fallen but temporary rentals have risen.
According to the Scalabrini Ortiz Center for Economic and Social Studies (CESO), the average monthly rent for a studio apartment in Buenos Aires was AR$78,000 (US$395 at the official rate, US$212 at the MEP rate) in February. In the past 12 months, rent prices went up by 122.9%, while general inflation was 98.8%.
Patricia, who asked the Herald to not use her real name, rents out her family’s apartment in Palermo through Airbnb. She thinks the 2020 Rental Law is partly to blame for the rising rents and lack of long-term leases. City government sources agree. Opposition coalition Juntos por el Cambio has called for the law to be repealed, and even Congressman Daniel Lipovetsky, who initially pushed for it, said “it did not work.” As well as three-year leases, the law freezes rental prices for a year, after which the new price is calculated through inflation.
“That means there are six months of the year where the landlord rents out at a ridiculously low price, and six months when the tenant has to absorb an insane increase,” Patricia said. “A lot of owners took their apartments out [of the market] for traditional rents and the ones that do let them charge a fortune.”
Patricia herself did that — she charges US$28 a day for her apartment.
“If I have to be honest, now that it’s getting increasingly more difficult for people to rent an apartment, it riddles me with guilt.”
According to journalist Nicolás Artusi, only five of the 18 apartments in his building are permanently occupied. The rest are AirBnBs, or sitting empty
“There are strange people all the time going in and out of the building,” Artusi said in a Twitter thread. His new, ever-changing neighbors have parties in the building’s shared rooftop patio and broke the building’s elevators as well as the front-door lock.
“Apartment buildings are not designed to function as a hotel.”
However, the higher rotation of neighbors aren’t the only new thing in Buenos Aires real estate.
“The construction model is starting to change,” said Muñoz. According to him, real estate developers are starting to build apartment buildings geared towards tourists, who pay higher prices in US dollars. “This raises rental prices in the area.”
According to Muñoz, that drives the inhabitants out of their neighborhoods and sweeps away entire cultures — a process known as gentrification. “They even started calling the neighborhoods by new names: Palermo Soho, Palermo Hollywood.”
“The state has decided not to get involved, it has given a carte blanche to the real estate market,” said Muñoz. “The short-term rental model cannot coexist with a society that is more or less egalitarian.”
After finding out about a deal between Mexico City and Airbnb that was decried by housing advocacy groups, former city legislator Facundo Di Filippo made a public information request to the Buenos Aires City government about a confidential agreement it signed with the company in May 2021 to advertise NomadsBA, a program created by the city government that positions Buenos Aires as a place for foreign digital nomads to work – they even offer a US$500 voucher to those that come to the city.
Two weeks ago, Di Filippo got his answer — the deal forbade “both parties” to regulate or take “economic or legal measures” against each other.
“There is no way a company can regulate the City government, it is a euphemism to shield the company’s activity,” Di Filippo told the Herald. “It is unconstitutional.”
Sources in the City Housing Institute and the Tourism Entity denied this, saying the deal is “standard” and was signed to promote Buenos Aires for international tourists during the end of the pandemic. They told the Herald that the agreement was not renewed after it expired in May 2022, and stressed that the “legal or economic measures” it forbade parties from taking only referred to the terms of the NomadsBA promotion agreement.
But one thing is indisputable — the deal helped to put Buenos Aires on the map as an Airbnb destination.
While members of Juntos por el Cambio, as well as real estate associations and landlords, blame regulations like the Rental Law for the rise in temporary rentals, other countries are responding with regulation that is based on the concept of housing as a right.
Last month, Portugal announced changes banning new tourist rentals, regulating rent rises, and facilitating the renting of empty houses. City mayor Horacio Rodríguez Larreta said in October 2021 that he would tax empty houses – but did not present any bills to do so.
“Buenos Aires is the great paradigm of a government that depends on the interests of the real estate businesses,” Di Filippo said. “It has to do with a neoliberal romanticization of platform economies.”
“It means the total touristification of Buenos Aires.”