Buying Real Estate in Uruguay

Buying Property in Uruguay

It should be pointed out that while I’ve shopped around, I’ve never personally bought real estate in Uruguay.

So, in that respect, I can’t give you a soup to nuts first hand experience of what is involved. I will however relate my experiences, first hand, of what goes on at the front end of the transaction and over time fill in the nitty gritty details as related to me second hand through friends and associates who have gone through the process and from realtors who take part in the process daily.

As I’ve related elsewhere, first and foremost Uruguay has no official MLS, nor realtor reporting database, nor is there a service that I’m aware of that lists closed prices.

This is a subtle, but important issue for the foreigner or outsider. Because your only view into the market is what is being asked publically for similar houses. While it may go without saying, I’ll say it anyways….those are for houses that haven’t sold.

In other words, the very fact that those houses are still on the market at the given asking prices advertised tells you – or should tell you – that those houses are above market prices. At least above any price where the property will fly off the shelves right? That is why you, the outsider, are being the offered the opportunity to bid.

Transaction Costs

The biggest question I get from most is “what are the transaction costs for buying a property?” These are generally recognizesd as being somewhere around 10% — But it should be noted that these really only include the expenses once you’ve found the property you are ready to start bidding on. If you are trying to formulate a realistic budget for finding a property you should factor in search costs…especially if you don’t already reside in Uruguay.

Real Estate Agents

Agents are a bit of a different breed here. Houses for sale are not listed by a given agent like they will be in the US and elsewhere. As a result, there is very little familiarity with the concept of a buyers’ agent. However, don’t let this mislead you. They, like agents everywhere, are in the game for the transaction…for the commission. They will do what they have to do (if they are smart) to make the transaction happen, including negotiate on your behalf with the seller. Do NOT take this to mean that they are working for you or have an fiduciary duty to you whatsoever.

The rules for what is required to become a real estate agent are even looser in Uruguay than in the U.S. There basically are no requirements that I”m aware of — I’ll let agents speak up by commenting here to refute that.