Why Uruguay Real Estate?
Ranked first in the Latin American region for democracy, peace and quality of living, Uruguay is also a high-income, transparent country with broad real estate appeal for investors seeking stable returns for modest outlay. This makes Uruguay real estate a popular investment for locals and foreigners.
- Foreign buyers and investors are not restricted from owning clear title to farmland, coastal property, or other types of property investments and real estate in Uruguay.
- Uruguay has a pragmatic economic policy that favors business and foreign investment.
- Foreign direct investment rose 9% in the first half of 2014 (source: United Nations).
- Uruguay has advanced education and social security systems and liberal social laws. As a result it is an appealing nation to live and invest in.
- Whilst the number of purchases of real estate by foreign buyers declined in 2014, foreigners still make up about 30% of all buyers.
- Favorable income tax rules for qualifying foreign residents.
- Uruguay real estate market supports all investment approaches including commercial and residential letting, development and tourism rental.
Uruguay Real Estate Market
We have highly qualified and experienced real estate buyer’s agents located in Uruguay. Please contact us for prices of real estate for sale in Uruguay, as well as current rental rates.
- Uruguay real estate market now more competitive and favors the purchaser since a reduction in buyer interest from neighbors Argentina and Brazil.
- Reduction in Argentine and Brazilian interest stemmed from tighter currency controls to limit capital flight from both nations, and the implementation of tax information exchange agreements.
- Increasing interest in Uruguayan real estate among European and North American buyers for investments and lifestyle reasons.
- Uruguay’s property market is now considered to be a mature, stable investment platform, ideal for long-term commitment.
- Exceptionally strong investment opportunities in the tourism sector, supported by both government policy and the fact that the direct contribution of travel and tourism to GDP is predicted to rise by an average annual amount of 5.2% for the next 10 years.
Real Estate Investment, Taxes and Doing Business in Uruguay
- There are no restrictions on foreign buyers: land and real estate can be bought and owned in any part of the nation, and you do not have to be a resident to purchase.
- Investors benefit from Uruguay’s transparent property registration process which follows a title verification check. This goes back 30 years and is completed by the purchaser’s escribano (a real estate attorney and notary combined).
- Whilst a slightly more expensive approach to buying Uruguay real estate, investors can choose to purchase and hold real estate within a corporation in Uruguay, which has advantages such as shielding assets from creditors, providing greater privacy and enabling the easy passing of real estate title down within a family.
- Buying costs total 9%.
- Net rental income from leasing Uruguay real estate is taxed at 12%.
- Capital gains are also taxed at 12%.
- There are no inheritance or gift taxes in Uruguay.
- Real estate tax is levied on immovable properties and the tax base is the cadastral value of the property, with tax rates varying from 0.15% to 0.30% depending on the property’s determined value.
Landlord and Tenant
- Uruguay’s landlord and tenant laws broadly favor landlords; rental rates for the majority of properties can be freely negotiated.
- Certain real estate is rent-controlled however, and certain rent restrictions apply on property constructed pre-1968.
- Typically the real estate market is priced in US dollars because it provides significant stability. High-end and tourism rentals are usually priced in dollars too.
Uruguay Property Investment Visa
- Investors do not require a visa or permit to purchase free title to real estate in Uruguay.
- Uruguay has an unrestricted and liberal attitude to immigration.
- It takes 12-18 months to obtain residency after an application is submitted, during which time applicants should spend at least a total of six months in Uruguay per year.
- Residents can obtain Uruguayan citizenship and a second passport.
- There is now a 5-year tax exemption on foreign sourced income for expats who spend more than 183 days per year in Uruguay.
- After the five years expire, expatriates must pay 12% income tax on foreign interest and dividend income. All other types of foreign sourced income will remain tax-free including capital gains, pension payments, rental income etc.
Real Estate Markets of Interest in Uruguay
Punta del Este – located 120 miles from Montevideo, Punta del Este is a city and resort on the Atlantic Coast in the Maldonado Department of southeastern Uruguay. The city has a year-round population of around 9,000 but experiences a massive tourism influx and related economic boom every summer. The resort has its own real estate economy because of its exceptional appeal as both a lifestyle destination and an incredibly consistently returning investment hotspot.
Punta del Este real estate for sale include homes, exclusive villas, small cottages, luxury mansions, ultramodern apartments and ocean view condos. Naturally there are strong commercial investment opportunities as well.
Montevideo – the capital and largest city in Uruguay is Montevideo and according to Mercer, it offers the best quality of life of all cities in Latin America. Therefore it’s unsurprising that it is of exceptional appeal to international investors.
Montevideo real estate stock available includes sprawling suburban houses, modern apartments and condominiums, gated community living and plenty of commercial opportunities too.
Colonia – the Uruguayan department of Colonia is in the Río de la Plata region. It’s capital is one of the oldest cities in Uruguay, Colonia del Sacramento which is exceptionally attractive and appealing, it’s a World Heritage Site and one of the leading tourism destinations in Uruguay and Latin America.
The city faces Buenos Aires and enjoys daily ferry arrivals from the Argentine capital; it is therefore the primary entry point for tourists from Argentina.
The Ocean Esplanade is popular with investors seeking tourism-facing stock. Alternative investment opportunities exist throughout the department of Colonia including in the farm belt, where the diversity of crops, land and even field types available are appealing to increasing investor interest.
Piriápolis – this is also a very important summer season resort in Uruguay, and its appeal pre-dates that of Punta del Este. Located about 60 miles from Montevideo, Piriápolis is on the Río de la Plata coast.
Piriápolis is described as ‘a laid-back beach enclave’ and was originally developed to resemble a French coastal town. The extended resort of Piriapolis stretches for some 15 miles and includes seven beaches, of which Playa de la Rambla and Hermosa are the most popular with the summer season visitors.
Farmland and Chacras – Small farms in Uruguay are called chacras. The farmland in Uruguay is very productive and many people choose to live on chacras due to the productivity. Also chacras offer tax breaks which can substantially lower property taxes. Finally, there are some great large scale farmland and agricultural investment opportunities as well.
Living in Uruguay
Uruguay is the second smallest nation in South America where cows outnumber humans, but what it lacks in size and population density it certainly more than makes up for in terms of its broad appeal.
In terms of the lifestyle available it is first world, progressive, safe and free; and because Uruguay has the freest political and labor conditions on the continent, has a diversified economy and welcomes international citizens of all ages and nationalities, it’s very easy to make Uruguay your home as an expatriate.
With beautiful old colonial towns and well-established high-end beach resorts, a moderate year-round climate and a very stable real estate market, Uruguay doesn’t have to try too hard to attract expats looking for a fabulous place to live, or investors seeking a secure investment environment.
Uruguayans are largely of European descent, and generally they are well educated, friendly and open people keen to welcome new faces to their beautiful nation. Many speak English as a second language, making living in Uruguay easy particularly for expats who herald from North America or the UK for example. Otherwise, the main language is Spanish.
Those who choose to retire to Uruguay can enjoy a high standard of living in a country proud of its stunning and untouched natural environment, where the sea or the hills are never much more than a 30minute drive away from your home, and where everything from infrastructure to healthcare are first world.
The cost of living in Uruguay needs a mention however, imported goods are highly taxed for example, and Uruguay’s sophistication and quality of life has to come at a fair price. Finally, there’s often a relatively lengthy bureaucratic process involved in the majority of transactions – from getting your local ID to getting utilities connected for example.
Uruguay Location and Geography
Uruguay (or República Oriental del Uruguay) is located in the southeastern region of South America. It’s bordered by Argentina to the west, Brazil to the north and east, and the Atlantic Ocean to the south and southeast.
The nation is home to approximately 3.3 million people, of whom 1.8 million live in the metropolitan area of Montevideo.
Uruguay has over 400 miles of coastline, 10 national parks, and the majority of its landmass is rolling plains, low hills and very rich and fertile coastal lowlands.
The climate is largely uniform nationwide and considered humid subtropical. Northwest Uruguay has arguably warmer summers and milder, drier winters than the rest of the nation.
Regions in Uruguay
Uruguay is divided into four regions and multiple departments. The regional divisions are based on social, economic, and geographical factors.
- The Interior – this is the largest region of Uruguay and includes the departments of Artigas, Cerro Largo, Durazno, Flores, Florida, Lavalleja, Rivera, Salto, Tacuarembó, Treinta y Tres and the eastern halves of Paysandú, Río Negro and Soriano.
- The Littoral – this stretches west along the Río de la Plata from the capital of Montevideo, incorporating the departments of San José and Colonia. Then to the north along the Río Uruguay it includes the western halves of the departments of Soriano, Río Negro, Paysandú and Salto. This region is more developed than the interior.
- Greater Montevideo – this is home to over a half of Uruguay’s total population and incorporates the departments of Montevideo, Canelones and the eastern portion of the department of San José.
- The Coast – heading east from Montevideo along the Río de la Plata this region incorporates coastal Canelones as well as the departments of Maldonado and Rocha – and it includes the resort of Punta del Este.
[Source: For more information Wikipedia Uruguay]
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