Finding cash investors for international rentals

Buying & Selling Real Estate
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Finding cash investors for international rentals

Mason Scholtes
Member since 2018 · 14 posts · 5 votes

Having spent 6 months in Buenos Aires, I have long loved the city. It is by far the cheapest (high quality of life) city in the world and it just got cheaper.

With Javier Milei the most likely to become president in October his anti socialist (libertarian) policies will potentially have huge effects on the economy. If he does take power it is likely that property values will explode higher. It’s possible the right properties 3,5 or 10x over the next years.

With my buddies in BA that are local real estate experts and rental managers I have access to very desirable properties to buy at a discount from an already depressed market.

I would like to put together a group of investors to purchase multiple rentals and benefit from the likely appreciation due to the change in government.

Any suggestions on reaching cash investors who are open to a little more risk for a much better potential return?

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  • Mike LambertPro Member
    Investor · The Americas and Europe · Member since 2016 · 1k+ posts · 1k+ votes
    3y

    Hey Mason,

    Buenos Aires is a beautiful city indeed but the best advice I can give you is to be careful about being sold a dream and risk the money of people you don't know to realize it (by the way there are legal constraints in doing that).

    Argentina used to be the third richest country in the world and the politicians wrecked everything to the point it's almost as bad as Venezuela. Every so often, they get a political candidate who supposedly is going to win the elections and save the day. The few times they win, it never works. The last hope was president Macri who ended up failing miserably.

    I've visited the country and looked at real estate myself and have followed the situation closely over the last 20 years with the help of my own real estate contacts there. Thankfully I never invested as the people who are knowledgeable told me to stay away. I know investors who did buy and they lost huge amounts of money.

    On another note, we know from the US and other parts of the world that cheap cost of living doesn't mean property prices increasing by multiples. By the way, did your buddies there explain to you where these 3.5 and 10 multiples come from.

    Argentina is one of these very rare countries where you seriously risk having the government confiscate your assets. After all, they've already defaulted on their debt several times and they have already resorted to confiscate the pension money of their own citizens. Given all this, I'd never invest a cent of my own money in that country but, if you absolutely want to do something there, maybe you could:

    1. Buy a property using your own money and show that you can make several times your money. The good thing about that strategy is that you can probably do it since the property are cheap. If you can't, you could reach out to friends and family. Just make sure to disclose the risks to them if you don't want to risk ruining those relationships.

    2. Alternatively, you could focus on targeting lifestyle buyers instead of investors. I mean people who'd like to own a property and enjoy so they don't care about making money from the property or have the property losing value. They'd have to be comfortable with the government confiscation risk though.

    Hope this helps

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