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Arequipa's real estate market is experiencing significant growth with property prices averaging S/3,480 per square meter as of September 2025. The city's dynamic housing market offers opportunities for both investors and residents, with premium neighborhoods commanding prices up to 50% higher than the city average while suburban areas provide more affordable alternatives.
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Arequipa's real estate market shows strong growth with average prices of S/3,480 per square meter, premium districts reaching S/5,180 per square meter, and annual appreciation rates of 9%.
The city offers diverse housing options from affordable suburban properties to luxury developments in Cayma and Yanahuara, with total transaction costs ranging from 4.5% to 6% of purchase price.
| Property Type | Average Price Range | Location |
|---|---|---|
| City Center Apartments | S/451,000 (2-bedroom) | Downtown Arequipa |
| Premium District Homes | S/888,000 - S/1,670,000 | Cayma, Yanahuara |
| Suburban Properties | 15-30% below city average | Outer districts |
| New Construction | S/5,180 per m² | Premium areas |
| Older Properties | 20-30% below new builds | Various districts |
| Residential Land | S/93 per m² (urban fringe) | Development areas |
| Monthly Rent (2-bedroom) | $600-$1,400 | City center |
How much is the average price per square meter in Arequipa right now?
The average price per square meter for residential property in Arequipa stands at S/3,480 (approximately $1,000) as of September 2025.
This citywide average masks significant variation between different areas and property types. Premium districts like Cayma and Yanahuara command much higher prices, reaching up to S/5,180 per square meter for new developments.
Suburban areas and older properties generally fall below this average, with prices decreasing as you move away from the city center. The variation reflects Arequipa's diverse neighborhoods and the quality differences between new and established developments.
It's something we develop in our Peru property pack.
What's the typical price range for apartments in the city center versus the suburbs?
City center apartments in Arequipa show a clear premium over suburban properties, with new centrally located units commanding the highest prices due to high demand and limited supply.
For a standard 2-bedroom apartment in the city center, monthly rental prices range from $600 to $1,400, while purchase prices average around S/451,000 for an 87-square-meter unit. Suburban apartments typically cost 15% to 30% less than their city center counterparts.
The price difference stems from accessibility, amenities, and proximity to business districts. Central locations offer walkability to restaurants, offices, and cultural attractions, while suburban areas provide more space and parking at lower costs.
New apartment developments in central areas face supply constraints, which keeps prices elevated and creates competition among buyers and renters.
How much does a standard two-bedroom apartment cost on average?
A standard two-bedroom apartment in Arequipa costs approximately S/451,000 for purchase, based on a typical 87-square-meter unit in a mid-range development.
This price point represents new or recently built apartments in desirable areas. The cost translates to about S/5,180 per square meter, which aligns with premium district pricing for quality developments.
Older two-bedroom apartments or those in less central locations typically cost 20% to 30% less, offering opportunities for buyers willing to renovate or accept slightly less convenient locations.
Monthly rental prices for two-bedroom apartments range from $250 to $700 in suburban areas, while city center units command $600 to $1,400 per month.
What's the going rate for a three-bedroom family house in a residential neighborhood?
| Neighborhood Type | Price Range (S/) | Price per m² (S/) |
|---|---|---|
| Premium Districts (Cayma, Yanahuara) | 1,200,000 - 1,670,000 | 7,740 - 8,030 |
| Mid-Range Residential | 888,000 - 1,200,000 | 5,500 - 7,000 |
| Affordable Neighborhoods | 650,000 - 888,000 | 4,000 - 5,500 |
| Suburban Areas | 500,000 - 750,000 | 3,200 - 4,500 |
| Older Properties (Renovation Needed) | 400,000 - 650,000 | 2,800 - 4,200 |
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How do prices change between new constructions and older properties?
New construction properties in Arequipa command a significant premium over older buildings, with price differences ranging from 20% to 30% for comparable locations and sizes.
New apartments in popular areas like Cayma and Yanahuara reach S/5,180 per square meter, while older properties in similar locations typically sell for 20% to 30% less. This price gap reflects modern amenities, updated building codes, and move-in readiness.
Older properties often require renovation and updating, which buyers must factor into their total investment. However, they can offer good value for investors willing to undertake improvement projects.
The age premium also varies by neighborhood, with established areas showing smaller gaps between new and old properties compared to rapidly developing districts where new construction sets premium standards.
What's the average cost of land per square meter for residential use?
Residential land in Arequipa starts at approximately S/93 per square meter ($25) for plots on the urban fringe, though prime, build-ready land in central areas commands significantly higher prices.
Land prices vary dramatically based on location, infrastructure availability, and development potential. Urban fringe areas offer the most affordable entry points for land acquisition, while established neighborhoods with full services cost considerably more.
Prime buildable land in desirable districts can cost several times the urban fringe rate, though specific pricing data for these premium locations remains limited in public records.
Buyers should factor in infrastructure costs, permitting requirements, and development timelines when evaluating raw land purchases for residential construction.
How much more expensive are premium neighborhoods compared to mid-range ones?
Premium districts in Arequipa, particularly Cayma and Yanahuara, command prices 40% to 50% higher than the citywide average for equivalent properties.
This premium reflects superior location, established infrastructure, proximity to amenities, and social prestige. Premium neighborhoods typically offer better security, maintained streets, and access to quality services.
The price gap between premium and mid-range neighborhoods continues to widen as demand outpaces supply in the most desirable areas. New developments in premium districts face limited land availability, which constrains supply and supports higher prices.
Mid-range neighborhoods offer more accessible pricing for families while still providing good quality housing and reasonable access to city amenities.
It's something we develop in our Peru property pack.
What's the price difference between renting and buying in Arequipa?
Arequipa's rental market offers gross yields of approximately 6% annually, making property purchase financially attractive for long-term investors compared to many international markets.
Monthly rental rates for a standard 2-bedroom apartment range from $600 to $1,400 in the city center, while suburban options start at $250 to $700. These rental rates create favorable rent-to-purchase ratios for property buyers.
The stable rental demand, driven by urban migration and economic growth, supports consistent income for property investors. Rental yields in Arequipa compare favorably to other major Peruvian cities.
Buying becomes particularly advantageous for long-term residents and investors, as the combination of rental income potential and property appreciation creates strong total returns.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Peru versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
How much do property taxes and closing costs usually add to the purchase price?
Property transactions in Arequipa involve several mandatory costs that buyers must budget beyond the purchase price, with total transaction costs ranging from 4.5% to 6% of the property value.
The transfer tax (Alcabala) represents the largest single cost at 3% of the property value. Additional expenses include legal fees, notary services, and property registration, which collectively add another 1.5% to 3% to the total cost.
New construction purchases face an additional 18% VAT on the property value, significantly increasing the total investment required. This VAT applies only to new builds, not existing properties.
Buyers should budget conservatively for these costs, as they represent a substantial addition to the base property price and must be paid in cash during the transaction process.
How much should buyers budget for renovation or finishing costs per square meter?
Basic renovation costs in Arequipa range from $200 to $700 per square meter, while comprehensive quality renovations require $1,000 to $1,500 per square meter or more.
- Cosmetic updates: $200-$400 per square meter for painting, flooring updates, and basic fixture replacements
- Moderate renovation: $400-$700 per square meter including kitchen and bathroom updates, electrical improvements
- Complete overhaul: $700-$1,200 per square meter for structural changes, premium finishes, modern systems
- Luxury renovation: $1,200-$1,500+ per square meter for high-end materials, custom work, and premium appliances
- Structural work: Additional costs for foundation, roofing, or major architectural changes beyond standard renovation
What's the yearly appreciation rate or trend in real estate prices in Arequipa?
Arequipa's real estate market demonstrates strong growth with annual appreciation rates of 9% during 2024-2025, significantly outpacing inflation and most other Peruvian cities.
This appreciation rate reflects robust economic growth, urban migration, and supply constraints in desirable areas. The growth substantially exceeds Peru's inflation rate and provides strong returns for property investors.
Future projections suggest the appreciation rate will moderate to 4% to 5% annually over the next five years as new supply catches up with demand and major infrastructure projects reach completion.
The strong appreciation trend positions Arequipa as one of Peru's most dynamic real estate markets, offering superior capital growth potential compared to larger cities like Lima.
It's something we develop in our Peru property pack.
How do Arequipa's housing costs compare to national averages in Peru?
| City | Average Price per m² (USD) | Annual Growth Rate (%) |
|---|---|---|
| Lima | $1,500 | 3-7% |
| Arequipa | $1,000 | 4.5-9% |
| Cusco | $1,200 | ~3.8% |
| Trujillo | $900 | 3-5% |
| Chiclayo | $800 | 2-4% |
Arequipa offers lower entry costs than Lima while delivering superior capital appreciation, making it an attractive market for both local buyers and investors seeking growth potential in Peru's real estate sector.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Arequipa's real estate market presents compelling opportunities for both investors and residents, with strong appreciation rates and diverse property options across different price points.
The combination of lower entry costs compared to Lima, robust rental yields, and superior capital growth makes Arequipa one of Peru's most dynamic property markets for 2025 and beyond.
Sources
- The LatinVestor - Arequipa Price Forecasts
- The LatinVestor - Arequipa Real Estate Trends
- Armenian Lawyer - Living Costs in Peru 2025
- Fazwaz - 3 Bedroom Houses Yanahuara
- Realtor.com International - Arequipa
- Icon Realty Advisors - Arequipa Land
- The LatinVestor - Moving to Peru Buy Property
- Money Magazine - Home Renovation Costs 2025