Real estate agents ask that used properties be included among the destinations for money laundering

After the approval of the Law of Bases and the fiscal package,real estate companies are asking the Executive Branch to incorporate into the regulation the possibility of that the money laundering funds be used to purchase used properties.

Formally, the Argentine Real Estate Chamber (CIA) sent a note to President Javier Milei and Minister Luis Caputo with the request that includes the idea that the purchase of used properties do not pay the 5% rate provided for in the legislation.

It happens that the asset regularization regime exempts those who declare up to US$ 100,000 from paying fines, while for larger amounts it establishes progressive aliquots ranging from 5% to 15%.

Ivan Ginevra, president of the Chamber, explains that “the law provides that some destinations of money laundering are exempt from paying taxes and leaves it open to the Executive Branch define other destinations that may also be exempt(such as the acquisition of participation certificates or debt securities of productive investment trusts or the subscription of shares of mutual funds, among others).

In this sense, the text indicates that “the Executive Branch may add other destinations to those previously provided, which have the purpose encourage productive investment in the country or promote productive investment by small and medium-sized businesses in provinces with a lower degree of relative development or encourage credit for them.”

Specifically, according to Alejandro Bennazar, a sector representative, “the whitewashing process would be very important for new constructions with the first deed and also for used properties, because this would also It would generate a lot of fast labor due to the large volume there is. It would be an activation for more than 100 sectors linked to the real estate sector”, he pointed out.

The entity’s note stated: “The Argentine Real Estate Chamber requested the national Executive Branch to incorporate into the regulations of the law or through the mechanism it considers appropriate the possibility of allocating funds from the Asset Regularization Regime to investments in used properties, exempting them from the aliquot established in said regime.”

“The objective of the proposal is to give dynamism to a sector that is crucial for the development of the Nation, with the real estate sector being the main promoter of access to housing for the citizens of this country,” the letter continued.

“The possibility of allocating laundered funds to the purchase of used housing, exempting themselves from paying the 5% rate, means a greater incentive to mobilize savings and generate cash inflows into the formal economy, “Therefore, generating a larger collection base for the State and greater investment capacity for those who manage to sell their properties thanks to this incentive mechanism,” the request justified.

The real estate sector has been trying to reactivate itself not only with money laundering but also betting on the return of mortgage credit. The latest data from the College of Notaries of the Federal Capital showed that, in May (even without the impact of new loans) property sales registered their highest level in six years with 4,590 deeds. This meant a year-on-year increase of 36%.

Added to this, in June, according to a recent report by First Capital Group, mortgage loans,including those adjustable by inflation/UVA, had an increase of 5.4% compared to the previous month and accumulated a year-on-year increase of 45.8% in nominal terms.

However, The sector is coming from years of great contraction and falling prices, which is why real estate agents believe that money laundering is an ingredient that would help the sector to take off.