Nov. 4, 2014
Real estate in Uruguay trades in U.S. dollars
Dear Overseas Property Alert reader,
Piriápolis, Uruguay, is one of the country’s most popular destinations and has been one of its best performing property markets.
Piriápolis was Uruguay’s first seashore resort, founded in 1890, more than 15 years before the founding of world famous Punta del Este. It’s located between Montevideo and Punta del Este, adjacent to the lesser known Costa del Oro. (Follow this link to see my recent essay on Costa de Oro.) A little more than an hour from Montevideo, Piriápolis has long been popular with Uruguayans for its sandy beaches, calm waters, and attractive seafront.
When I first drove into the town of Piriápolis, it immediately brought back fond childhood memories of summers on the New Jersey shore. The old buildings, seafood restaurants, and people sunbathing or strolling along the boardwalk simply looked like life in the 50s.
Still, with less than 10,000 residents, Piriápolis never achieved the international fame of Punta del Este, and, in fact, its popularity was eclipsed by the upstart Punta del Este just after the turn of the 20th century. But that doesn’t mean it’s not popular.
A Bustling Summertime Resort
In the summertime (January), Piriápolis is jammed to the seams, as vacationers come to enjoy the friendly ambiance, seafood restaurants, casinos, and, of course, the beaches. The combination of the town and the summertime crowd conveys a positive, upbeat feeling.
In the wintertime the town seems deserted, which is to be expected at any resort in Uruguay. As a resident of nearby Punta del Este, I can tell you that it’s fun when the summer crowds show up each year…and a pleasant relief when they go home.
Piriápolis is also popular with boaters, as it is home to two marinas on a coastline that has few places to moor a boat.
Lots of people, energy, and bustle in the summer, and solitude in the winter
One of my favorite features of Piriápolis is that it’s walkable. At most downtown locations, you’ll get by easily without a car. And for trips to Montevideo or Punta del Este or their international airports, Piriápolis offers frequent, modern bus service.
Piriápolis Is An Unusual Expat Haven
Piriápolis is understandably popular with full-time expats. The local expat community is fairly close and meets periodically. Uruguay is one of the world’s most popular countries for those who value individual sovereignty and offshore diversification. And for some reason, a number of such expats have chosen to settle in Piriápolis.
The folks I’ve met have been unusually savvy about banking, privacy, currency trends, and international politics.
Pretty beaches and old fashioned downtown backed by rolling hills
Getting The Lay Of The Land Round Piriápolis
When I talk about the Piriápolis market, I usually include a number of outlying areas around town. All have easy access to the conveniences of the city.
The sectors of Bella Vista, Las Flores, and Playa Verde are located along the seafront road west of downtown Piriápolis. Playa Hermosa lies a bit farther away but is still within sight of town. Playa Hermosa is actually on a loop road that runs along the water, rather than the main coastal road, so it’s quiet with almost no traffic.
Heading east from town, Punta Colorada is a point that juts out into the sea, about five minutes from downtown. I like this area particularly because a well-situated house can have a 270-degree view of an awesome section of coastline.
A Once-Overlooked Property Market That’s
Outperformed Many Of Its Peers
I first looked for property in Piriápolis in 2005, when I was looking for a place to live and I’ve kept fairly detailed records of a few projects there since 2008.
During the past six years, prices in La Riviera building (on the waterfront) have gone up about 29% per year (175% overall). In the Amarres Reales project (overlooking the marina), prices have gone up about 15% per year, or 88% overall. This performance is despite the continued mayhem in Argentina, which has cut sharply into Uruguay’s tourism. Houses have gone up a bit less than apartments, but they’ve also increased notably.
So the old stereotype about the flat, dull market in Piriápolis is simply not true. The market is respectable.
But that said, your liquidity will be somewhat better in Punta del Este than in Piriápolis. Punta del Este is more expensive, but it gets a lot more international traffic.
Here’s a sampling of what’s on the market in Piriápolis today.
|We found a small house in Playa Hermosa, five blocks from the beach. Built in 2008 with 80 m2 (860 square feet) of living area, the house has three bedrooms sharing a single bath, fireplace, covered patio with barbecue, and a single-car garage. The asking price is US$90,000.|
|Also in Playa Hermosa, we found a 1960-vintage bungalow on the market. It has 150 m2 (1,614 square feet) of space, with three bedrooms, one-and-a-half baths, a covered terrace with barbecue, and a single-car garage, all on a nicely landscaped lot 50 meters from the beach. The asking price is US$160,000.|
|In Bella Vista, there’s a group of almost-new duplexes (built in 2012) with wonderful ocean views right on the beachfront road (called the rambla). One of these is on offer now with 64 m2 (688 square feet) of living area on two floors, including two bedrooms, two baths, air conditioning, alarm system, patio with barbecue, and carport. The complex has a tennis court and swimming pool. The asking price is US$117,000.|
|In a shady, pine-studded area of the convenient Playa Grande neighborhood, we found a 1985-vintage house with a guest quarters in the backyard. The house has two bedrooms and a single bath, while the guest or caretaker’s quarters has one bedroom and a bath. Total square footage is 160 square meters (1,721 square feet). The fenced yard has mature pines and there is a single-car garage, all less than 100 meters from the beach. The asking price is US$185,000.|
|In the center of town, less than 100 meters from the beach, there’s a ground floor apartment for sale with 90 m2 (968 square feet), three bedrooms, three baths, and parking for two cars, for the asking price of US$110,000. Built in 1950, the apartment is livable as-is, but some remodeling would make it into a nice village home, within walking distance to everything in Piriápolis.|
|In a classic 1940s apartment building downtown, one block from the Piriápolis rambla, we found a three-bedroom, two-bath, third-floor apartment (with elevator) for sale, with 93 m2 (1,000 square feet) of living area. The master bedroom and living room have water views, and this one’s ready to move into for the asking price of US$155,000.|
|The best deal we found on the beachfront was a third-floor apartment on the rambla, with 80 m2 (860 square feet), two bedrooms, two baths, and magnificent views from the living area and master bedroom. The building has both an elevator and doorman. The asking price is US$180,000.|
Is Piriápolis For You?
Piriápolis is not only unique in Uruguay, but its feeling is unique, in my experience, anywhere outside the United States. It’s got an ambiance and appeal that I haven’t quite seen anyplace else.
And make no mistake, one if its biggest draws is that it’s in Uruguay, a First-World environment with low crime levels and a high standard of living, a country that offers a solid financial system, a strong agricultural base, and a friendly, welcoming culture.
If you’d enjoy a small, friendly town by the sea that calls to mind 1950s America, than Piriápolis could well be for you.
Editor, Overseas Property Alert
Why don’t you guys ever talk about unfurnished rentals in Medellin? I’ve read a lot about buying for investment and even living in a furnished rental. How about some info on long-term, unfurnished rentals?
That’s a fair point. I’ve looked at unfurnished rentals from a landlord’s perspective, but have never really studied them as a residential option.
But I saw a good post recently on the topic, on a blog operated by expat David Lee. David’s a guy I met in Medellin who has become an excellent source of firsthand, unbiased information on living there. He also hosts informal expat events around town at some great restaurants. Follow the link to see their article on long-term rentals in Medellin.
What are the tax implications on worldwide income of living, say, in Italy or other EU countries? What if you hold an EU passport but haven’t lived there in a long time?
If you are tax-resident in Italy, you’ll owe them tax on your worldwide income regardless of your country of citizenship. And you become tax-resident in Italy if you live there at least 183 consecutive days during a 12-month period. If you live there less than 183 days, then you only pay tax on Italian income.
Looking at it the other way, if you are an Italian citizen who does not live in Italy, you do not pay income tax on overseas income or assets.
There are no EU-wide rules that state how EU nationals who live outside their home countries are to be taxed on their income, so you’ve got to check country-by-country. Italy’s scheme, however, is fairly common by EU standards.
Have a question? You can write to Lee here.