ARGENTINA is famous for cattle, Eva Perón, its red wine — and a series of devastating economic crises. Despite this financial instability, or perhaps because of it, the country offers many advantages to British property buyers. So is this really a sensible time to invest in Argentina?

One source of encouragement is its economic growth — up last year by an estimated 8.5 per cent. Another is that tourism is booming: according to Argentina’s La Nación newspaper, it has been practically impossible to beg, borrow or steal plane tickets to the capital recently. Economy fares to Buenos Aires are hard to come by, and the city’s five-star hotels are said to be running at 95 per cent occupancy. Last year, 3,000 new jobs were created by tourism and it is anticipated that 12 per cent of the workforce will be employed in the sector by 2010.

All of which should be good signs for the local property market. Alan Faena, a fashion designer-turned-hotelier-turned-property developer, would certainly hope so. He was responsible for regenerating Puerto Madero in east Buenos Aires, an area comparable with London’s Docklands. When he opened his luxurious boutique hotel, modestly called the Faena Hotel and Universe, there were only run-down warehouses and a deserted transport canal to be found there. Now, Hilton and Sofitel have opened hotels in the area; boutique shops and restaurants have followed.

It is in Puerto Madero that Faena launched his latest housing development, called El Aleph (“The A”). Designed by Norman Foster, the development will have 180 homes, starting at £146,000 for a one-bedroom flat, £305,000 for a two-bedroom flat and between £1 million and £3.5 million for a penthouse. El Aleph consists of two buildings overlooking the canal and park, and will include a pool, spa, restaurant, theatre, shops and a five-star hotel. The hotel will manage the rental of the flat, should you want to let it out.

It is, by some way, the most expensive development in Buenos Aires, a fact that Faena is quick to acknowledge. “With the apartments you are getting a respect for design and architecture,” he says. “That keeps prices up, though you will be getting a Foster apartment for a tenth of the price you would pay in London.”

Indeed, the relative strength of the pound is just one of Argentina’s many appealing factors. It would be difficult to spend more than £10 on a meal, for example. Similarly, a Faena flat has the finish you might expect of a million-pound City penthouse.

El Aleph is the fourth development undertaken by Faena in Puerto Madero. All have opulent interiors, with plenty of red and dark woods, harking back to Argentina’s belle époque, when it was one of the wealthiest countries in the world. Some Argentinians are doing very well for themselves today, with more local buyers able to afford the Faena price tag than you might assume: local buyers make up 60 per cent of sales, with the other 40 per cent including Britons, Americans and Spaniards.

One significant reason why Argentina will not suit all investors, however, is — inevitably — a question of finance: one side-effect of its recurrent economic problems is the extreme difficulty of getting a bank loan. “Argentina doesn’t understand mortgage debt,” confirms Andrew Langton, of Aylesford International in London, who is in charge of handling UK sales. “Everything tends to be cash, and purchases tend to be outright.”

Aylesford International: 020-7351 2383 www.aylesford.com

LATIN AMERICAN HOT SPOTS

IF IT’S Latin American bargains you’re after, the best destination is Brazil, according to Charlie Prichard, of the property company Churchill Overseas. “Five years ago properties were five times the price they are now, but then there was a huge property crash,” he says. “Prices slumped by 65 per cent, almost overnight and they haven’t recovered. You can pick up a villa on the beach for £14,000.”

A particularly beautiful place to buy, he says, is Itamaracá, an island near Recife. “There are white sand beaches and it’s very undeveloped. Of course, everyone knows that Rio is something of a troublespot, but the northeast coast of Natal, from Recife to Fortaleza, is very attractive and you can pick up a good-quality property in a new development for as little as £20,000.”

James Price, head of Knight Frank’s international developments, says there is a growing appetite for Latin America as a whole, but particularly for Bahia in Brazil. He says: “Developers there are increasingly targeting European audiences. Argentina and Uruguay have established markets among European buyers but until now Brazil has lagged behind. We expect that will change dramatically in the next few years as the emerging market picks up momentum.”

Mary Gold

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