Should You Invest?
Uruguay is known for having a very small rental market but
despite this the country's real estate market is still very
good, receiving increasing interest from potential investors.
Uruguay is still a recovering country but it doesn't share the
problems such as unemployment and poverty like its neighbouring
countries. Recent growth suggests definite recuperation, and
low taxes and entry levels are undeniably appealing to the
international investor. With FDI steadily increasing and a purchase
process favourable to the foreign investor, Uruguay does offer
potential. Carefully chosen investments by those willing to take a
risk are likely to perform well over the medium term.
- Uruguay is experiencing high rental yields especially in major
cities such as Montevideo.
- The country has shown strong economic recovery in recent years,
advancing past countries in similar positions.
- The rental market is strongly pro-landlord.
- The transaction costs when purchasing a property are moderate
between both the buyer and the seller.
- Uruguay has a very advanced welfare system which it introduced
and maintained itself.
- Inflation has dropped consistently over the past 5 years.
- Tourism is rising each year, increasing the rental market
potential.
Rental Yields
Uruguay has very high rental yields as there are not
currently many rental properties available. The highest yields are
found in main cities, for example a 400 sq m property in the
country's capital Montevideo will cost around US$470,000 and can
obtain an average monthly rent of US$4,473 and a rental yield of
11.4%. Smaller properties in similar locations can receive yields
of between 7.5% and 10.5%. Beachfront properties have lower yields
of around 4.2% to 6.4%.
Price History
The main factor driving an increase in property prices and
rental yields is the growing numbers of tourists each year and the
increased interest from potential investors. Punta Del Este is the
most expensive place in terms of real estate in Uruguay, due
to its booming tourist industry which is causing a construction
boom and property can go from as much as US$2,000 per square metre.
Montevideo is the most expensive place to acquire property in
Uruguay, especially Carrasco where apartment prices start at
US$2,152 per square metre.
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