Home Rental in Uruguay

Posted on April 20, 2007
Filed Under Real Estate, Expat Tips | 10 Comments

Unlike in North America, it is rare that a rental unit will belong to a corporation that owns a whole building. Almost always you’ll be renting from an individual owner. This means that the negotiation process will be more complex and emotional. After all, you may very well be renting somebody’s former home. And as many owners do not engage a property manager, you should not expect much support after you’ve rented. Of course, if there is a leak in the apartment, the owner or his inmobiliaria may (or may not) call someone to fix it right away and will pay for it, but if your light fixture broke or a bulb is missing you are on your own.

It is always a good idea to look carefully whether the property you are interested in is listed with more than one real estate agent and/or is in the classified section of the paper. The asking price may vary from one place to the other, as the owner may be trying to establish the market rate for the property. Also, expect some price flexibility. A 10% reduction or more can sometimes be obtained through a bargaining process. There are no fast rules, since it will depend on the current market conditions and the owner’s discretion. Also, pay attention whether the price includes condo fees (gastos comunes) or not. More often than not, it is assumed in the prices quoted that you will pay the condo fees, in addition to the rent. Typically the person renting will need to pay a fee equal to one month’s rent to the agent that helped find the property.

When negotiating, remember that landlords in Uruguay face lengthy and costly processes should they need to evict a tenant for non-payment. They also face similar challenges in seeking reimbursement for damage to the property or to fixtures. Because of this risk, they often take precautions that seem over the top for a person coming from North America. For example, most rentals will be bare bones and most rental agreements will require anywhere from 5 months to a year of advance payment, plus a deposit that is returned at the end of the lease. The upfront payments will depend on the the owners perception of your ability to pay, or the risk of your leaving Uruguay and disappearing without paying.

Read the rental agreement carefully, because some owners may require that you hand the property back in the same condition as when you rented. This may mean you have to repaint the entire property or have the curtains washed. If you would like to be on the safe side, avoid renting from a landlord that is a lawyer or has a lawyer in the family. In case of a dispute, it will cost them far less to litigate than it will cost you.

In Uruguay, most unfurnished rentals will NOT come with a stove, a refrigerator, dishwasher or any other appliances. Furnished apartments with a complete set of appliances can be found, but they are few and significantly more expensive. If you choose the unfurnished route and need to purchase appliances, you will find they are more expensive than in North America.

Provided you take a few precautions, renting is the safest way to learn how it feels to live in a new country without making a major financial commitment or an irreversible personal investment.

You can find many real estate portals here. A Real Estate Spanish-English glossary can be found here.

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10 Responses to “Home Rental in Uruguay”

JP on April 20th, 2007 3:40 pm

Thanks for all that glossary, by the way where did you learn your Spanish?
Brazzie on April 20th, 2007 4:05 pm

Hi JP, I studied Spanish in college, although it was not my major. I always loved languages in general. Believe it or not, I used to enjoy reading dictionaries, yes reading, for hours on end. I once read a 2000 page French-French dictionary for fun. Knowing Portuguese helps in many things, however it also often gets in the way. The truth is that for lack of practice my spoken Spanish nowadays is too far into the Portuñol. But I intend to change that as soon as I get there.
Adrian on April 20th, 2007 9:11 pm

Another great reference, thanks Brazzie.

Is it usual to arrange a home inspection report
when negotiating a property purchase, or is it not custom and practice due to few mortgages.
Brazzie on April 21st, 2007 7:07 am

Adrian, to my knowledge home inspections by professionals is not routinely done in UY. As you pointed out, probably because of the lack of affordable mortgages and institutional buyers. But you can always hire an experienced architect to look at the property with a critical look.
Maria on April 21st, 2007 1:42 pm

So if you don’t have a mortgage what is the payment system?
Brazzie on April 21st, 2007 1:53 pm

It is expected that you will pay with cash, all at once. In some cases, in areas with liquidity problems, people may accept a property of lesser value as part of the deal. Sometimes even a car can be used as part of the payment.
Futurexpat on April 21st, 2007 10:28 pm

In the USA there would be no housing industry if there weren’t a mortgage industry! Just how do Uruguayos manage to save up enough money to buy a home outright?
Brazzie on April 22nd, 2007 8:14 am

It did not mean to say that mortgages do not exist in Uruguay altogether. They do. But in practice, access to them is limited. Either they are backed by the government and associated with specific social programs or they are the very expensive kind associated with the private banks. The end result is that relatively few homes are bought with financing.
Maybe for that reason, so many Uruguayans rent for life. Others will only have their own home upon inheritance.
Urufish on June 2nd, 2007 4:26 pm

For those of you interested in economics, Uruguay is a great place to see the theory of wealth by debt in the early stages.
When I first started coming here, in the 80’s, there was very little real credit… The credit that existed (beyond the OCA card) was individual shopkeepers writing what you owed in a book and collecting a few pesos from you each month. The roads looked like Havana, with very old cars the norm. Then along came the credit card companies.. and suddenly there was a spurt in spending… new phone system, new cars started appearing.
Phase 2, I figure the most important one of all, home financing MAY (not quite sure yet) be starting for real. There are at least 3 banks now offering mortgages - but only on new apartments. There has always been financing in the past, but it was composed of a small deposit, then a large payment (or 2 or 3) upon possesion, and a small payment for 60 or so months. But now, we’re seeing (I’d never seen this before here), 25 year amortized mortgages. The rates is around 4.5% plus IVA (results in 5.4%). I’ve only seen this in USD, but I dont see everything here.
A friend of mine told me the banks weren’t doing this for the mortgage business. They have ulterior motives. But to me, it sure looks like they’re in the mortgage business.
Brazzie on June 2nd, 2007 8:44 pm

Thanks for the info. I had read in the Uruguayan papers about more banks offering financing but no rates were mentioned. If this sticks, it has the potential to influence the real estate business in a big way, especially new construction.

Home Rental in Uruguay

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