Uruguay Coastal Properties

If you’ve read this sermon on Coastal Uruguay, forgive me, but we are getting vacation rental requests for later in the year and 2011 even. It appears our annual message has not been received.  If you’re visiting in December through February, or March for that matter, reserve your rental well in advance.

In 2009, high season rentals, December through February were a done deal by August. As mentioned many times, no owner wants to rent for a few nights during any of these months. One week is the minimum and from mid December through February, one week is consider a short-term rental. Many choose not to rent for one week.

Also, some people are pressuring for discounts………not in 2009 and not this year. First of all, demand was and is strong in Piriapolis as well as Punta del Este and prices were tending up, not down. Secondly, rents are paid in US dollars; the dollar is down almost 20% from last year at this time. This creates upward pressure on rates as many owners have to convert dollars into pesos.

For those planning on a visit, I hope this helps.

It’s been awhile since we’ve talked about the Pan Azucar development. As you may know, Sugar Loaf Ocean Club and Spa is the only luxury development inside the city limits of Piriapolis. In addition to second homes, the project will provide upscale vacation rental inventory as well as rental property for short and medium term needs.

Apparently, things have been going pretty well. In the last six months 41 lots have been sold, surpassing its projected lot sales for the year by 48%.

Due to the brisk sales, Sugar Loaf is buying 175 acres of land adjacent to Sugar Loaf, to develop as additional phases in the project. The additional property will more than triple the size of the project, increase the total acreage from 75 to 250 acres, and expand the number of lots from 114 to 380.

There are still only eight houses under construction or complete; it will be interesting to learn what’s up with all these lot purchases.

There’s also an opportunity for equity investors in this new phase. If interested, let us know and we’ll connect you with the developer.

Although the first half of 2009 was OK for the vacation rental market in Piriapolis, the last half of the year and high season 2010 are off to a strong start. Typically, we start booking January and February in August or so. This year, bookings started in May.

This is a nice turn-around when compared with the first half of the year. Although we were booked pretty solidly, we didn’t turn a lot of people away. In contrast, during the first half of 2008, we could have filled far more space than was available to us. For instance, we turned loads of people away who wanted to book the whole month of March.

Perhaps this reflects a global economy which is recovering a bit. At the very least, it’s a clear indicator the fear level that was palatable early in the year is easing.

This is good news for those of us with rentals and an advisory for those of you planning a visit.

Stay Tuned!

Steve Bowman