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Arequipa's real estate market presents compelling opportunities for both investors and those seeking to relocate to Peru's second-largest city. As we reach mid-2025, property prices in Arequipa continue their upward trajectory, with mid-range residential properties expected to rise by approximately 9% this year alone.
The city's growing population of over 971,000 residents, combined with strong economic fundamentals driven by mining activities and tourism, creates a robust foundation for property investment. For those considering whether to buy property in Arequipa in 2025, the answer largely depends on your timeline and objectives, but current market conditions favor buyers who can act decisively.
If you want to go deeper, you can check our pack of documents related to the real estate market in Peru, based on reliable facts and data, not opinions or rumors.
Arequipa's property market offers excellent value for money, with apartments ranging from $50,000 in affordable neighborhoods to $200,000+ in premium areas. The city provides a low cost of living, strong rental yields averaging 5.99%, and a welcoming environment for expats.
Property prices are forecast to increase by 9% in 2025, making current timing favorable for buyers, while the rental market remains strong due to consistent demand from students, professionals, and tourists.
| Investment Category | Price Range (USD) | Best Areas | Expected ROI |
|---|---|---|---|
| Affordable Properties | $50,000 - $80,000 | Paucarpata, Mariano Melgar | 6-8% rental yield |
| Mid-Range Properties | $80,000 - $150,000 | José Luis Bustamante, Sachaca | 5-7% rental yield |
| Premium Properties | $150,000+ | Cayma, Yanahuara | 4-6% rental yield |
| Commercial Properties | $100,000+ | Central District | 7-10% rental yield |
| Land for Development | $20,000 - $100,000 | Cerro Colorado, periphery | Capital appreciation focus |
| Short-term Rentals | $80,000 - $200,000 | Central, Yanahuara | 8-12% gross yield |
| Student Housing | $60,000 - $120,000 | Near universities | 7-9% rental yield |
What types of properties are available to buy in Arequipa right now?
Arequipa's real estate market offers diverse property types to suit different budgets and investment strategies.
Modern and colonial-style apartments dominate the market, particularly in central areas like Yanahuara and Cayma districts. These condominiums typically range from 60 to 120 square meters, with prices varying significantly based on location and amenities. New developments often include parking spaces, security systems, and communal areas.
Single-family houses represent another major segment, available across all neighborhoods from affordable options in Paucarpata to luxury homes in premium districts. These properties often feature traditional Arequipa architectural elements like sillar stone construction, courtyards, and multiple levels. House sizes typically range from 120 to 300 square meters of built area.
Land plots for development attract investors interested in new construction projects. Urban plots are available in established neighborhoods, while peri-urban areas offer larger parcels at lower prices per square meter. Zoning regulations vary by district, so buyers must verify permitted uses before purchase.
Commercial properties include office spaces, retail locations, and mixed-use developments, especially concentrated in the central business district and major commercial corridors. These properties often provide higher rental yields but require larger initial investments and specialized market knowledge.
How much did properties cost in Arequipa in the past, how much do they cost now, and what are the price forecasts for 2025?
Arequipa's property market has experienced consistent growth over recent years, with accelerating price increases in 2024 and 2025.
Historical data shows steady appreciation over the past decade, driven by population growth and economic development. By late 2024, the average price for new apartments reached S/451,000 (approximately $120,000), with typical units averaging 85-87 square meters. This represents significant growth from previous years as urban expansion and limited land supply created upward pressure on prices.
As of June 2025, current market prices reflect strong demand across all segments. Affordable neighborhoods like Paucarpata and Mariano Melgar offer houses and apartments in the $50,000-$100,000 range. Mid-range areas including José Luis Bustamante y Rivero and Sachaca typically see properties priced between $100,000-$200,000. Premium districts such as Cayma and Yanahuara command prices above $200,000 for quality properties.
Price forecasts for the remainder of 2025 indicate continued growth, with mid-range residential properties expected to appreciate by approximately 9%. This projection is based on sustained population growth, infrastructure investments, and limited developable land within the urban core. Mining sector expansion continues to drive employment and income growth, supporting housing demand.
It's something we develop in our Peru property pack.
| Property Type | 2023 Average Price | 2025 Current Price | Forecast End 2025 |
|---|---|---|---|
| 1-bedroom apartment | $65,000 | $75,000 | $82,000 |
| 2-bedroom apartment | $95,000 | $110,000 | $120,000 |
| 3-bedroom house | $130,000 | $150,000 | $164,000 |
| Premium villa | $280,000 | $320,000 | $349,000 |
| Commercial space | $180,000 | $210,000 | $229,000 |
| Land per sqm | $350 | $420 | $458 |
| Luxury penthouse | $450,000 | $520,000 | $567,000 |
Is it generally better to buy or rent a home in Arequipa in 2025?
The decision between buying and renting in Arequipa depends primarily on your timeline, financial situation, and long-term plans.
Buying property in Arequipa offers long-term financial advantages, especially given current market conditions. With property prices expected to rise by 9% in 2025, purchasing now provides immediate equity building and protection against future price increases. Ownership also provides stability and the freedom to modify your living space. For those planning to stay more than five years, buying typically proves more cost-effective than renting.
Renting provides flexibility and lower upfront costs, making it suitable for shorter stays or those uncertain about long-term plans. Current rental market conditions show stable yields averaging 5.99% gross, but rental prices are increasing due to high demand from students, professionals, and expats. Monthly rents range from $250-$800 for one-bedroom apartments to $800-$2,500 for three-bedroom properties.
Financial analysis suggests a breakeven point around 4-5 years for most properties, after accounting for purchase costs, maintenance, and opportunity costs. Given Arequipa's appreciation forecasts, buying becomes increasingly attractive for longer-term residents. However, those planning shorter stays or requiring maximum flexibility should consider renting.
The rental market's strength also creates opportunities for property investors, as consistent demand supports stable income streams and gradual rent increases align with property value appreciation.
What are the main real estate market trends in Arequipa right now?
Several key trends are shaping Arequipa's real estate landscape as we progress through 2025.
Population growth remains the primary market driver, with the metropolitan area surpassing 971,000 residents in 2024 and continuing to expand. This growth stems from both natural increase and internal migration from rural areas, creating sustained housing demand across all price segments. Urban expansion has led to development of new neighborhoods and infrastructure projects.
Strong employment demand, particularly in mining-related industries, supports robust purchasing power among potential buyers. The mining sector's continued expansion creates well-paying jobs that enable home ownership, while service sector growth supports rental demand from younger professionals and students.
A notable housing shortage affects the affordable segment, where limited land availability and zoning restrictions constrain new development. This supply-demand imbalance contributes to ongoing price appreciation and creates opportunities for developers who can navigate regulatory requirements.
The rental market experiences exceptional strength, driven by diverse tenant demographics including university students, young professionals, mining workers on rotation, and growing numbers of digital nomads and expats. Short-term rental demand benefits from Arequipa's tourism sector, which attracts over 300,000 visitors annually to the UNESCO World Heritage historic center.
Infrastructure improvements including road upgrades, utility expansions, and public transportation enhancements support neighborhood development and property value increases, particularly in previously underserved areas.
Which neighborhoods in Arequipa are the best to invest in—affordable, up-and-coming, or high-end—and what are the pros and cons of each?
Arequipa's diverse neighborhoods offer distinct investment profiles suited to different strategies and risk tolerances.
Affordable neighborhoods including Paucarpata, Mariano Melgar, and Hunter provide entry-level investment opportunities with properties typically priced between $50,000-$80,000. These areas offer strong rental yields due to high demand from students and young professionals, with lower maintenance costs and property taxes. However, they may lack certain amenities like upscale shopping or dining options, and some locations have higher crime rates requiring careful property selection.
Up-and-coming neighborhoods such as José Luis Bustamante y Rivero and Sachaca represent growth opportunities with properties in the $80,000-$150,000 range. These areas benefit from ongoing infrastructure development, new commercial projects, and improving transportation links. Investment potential includes capital appreciation as neighborhoods mature, but risks include development delays and uncertainty about future growth trajectories.
High-end districts like Cayma, Yanahuara, and select areas of the central district command premium prices above $150,000 but offer superior quality of life, safety, and established infrastructure. These properties typically appreciate steadily and attract quality tenants, but provide lower rental yields and require larger initial investments. Competition for prime properties can be intense among affluent local buyers.
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| Neighborhood Type | Investment Range | Rental Yield | Risk Level |
|---|---|---|---|
| Affordable (Paucarpata) | $50K - $80K | 6-8% | Medium-High |
| Up-and-coming (Sachaca) | $80K - $150K | 5-7% | Medium |
| High-end (Cayma) | $150K+ | 4-6% | Low |
| Central Historic | $100K - $300K | 5-8% | Low-Medium |
| Student Areas | $60K - $120K | 7-9% | Medium |
| Tourist Zones | $80K - $200K | 8-12% | Medium |
| Commercial Districts | $120K - $400K | 7-10% | Low-Medium |
What's the typical cost of living in Arequipa, especially compared to other Peruvian or Latin American cities?
Arequipa offers exceptionally affordable living costs compared to major Latin American cities and even other Peruvian urban centers.
Monthly living expenses for a couple typically range from $1,500-$2,000, significantly lower than Lima, Cusco, or international cities like Santiago or Buenos Aires. Housing represents the largest expense, with comfortable apartments available for $250-$800 monthly for one-bedroom units and $800-$2,500 for three-bedroom properties, depending on location and quality.
Daily expenses remain remarkably affordable, with restaurant meals costing $3-$8 for local cuisine and $10-$20 for international dining. Grocery costs allow comfortable living on $200-$300 monthly for a couple, while utilities including electricity, water, internet, and gas typically total $80-$150 monthly depending on usage and apartment size.
Transportation costs are minimal, with local bus fares under $0.50 and taxi rides within the city rarely exceeding $5. Many residents find walking or cycling sufficient for daily needs, particularly in central areas. Vehicle ownership remains optional for most residents due to compact city layout and adequate public transportation.
Compared to other Latin American cities, Arequipa ranks approximately 15% below Peru's national average cost of living and substantially below regional capitals. Healthcare costs are particularly favorable, with quality private medical care available at fraction of costs found in neighboring countries or major Peruvian cities.
Entertainment and cultural activities offer excellent value, with theater tickets, museum admissions, and recreational activities priced accessibly for most budgets. This affordability extends to domestic services, making comfortable middle-class living achievable on modest incomes.
What is life like in Arequipa as a foreigner or expat—social life, safety, amenities, lifestyle?
Arequipa provides an excellent quality of life for foreigners and expats, combining cultural richness with modern amenities and reasonable safety levels.
The expat community in Arequipa is growing but remains intimate, creating opportunities for meaningful connections with both international residents and welcoming locals. Digital nomads increasingly choose Arequipa for its reliable internet infrastructure, affordable coworking spaces, and proximity to natural attractions. The city hosts various social groups, language exchanges, and cultural events that facilitate integration into local society.
Safety levels are generally good with standard urban precautions. Petty crime exists, particularly in crowded areas and tourist zones, but violent crime rates remain relatively low. Most expats report feeling secure walking in central areas during daylight hours, though evening caution is advisable in certain neighborhoods. Local police maintain visible presence in tourist and commercial districts.
Healthcare facilities include quality private hospitals and clinics with English-speaking staff, modern equipment, and reasonable costs compared to Western countries. Dental care, general medicine, and specialized treatments are readily available, with many expats praising both quality and affordability of medical services.
Cultural amenities abound in this UNESCO World Heritage city, with numerous museums, galleries, theaters, and music venues offering regular programming. The historic center showcases stunning colonial architecture built from white volcanic stone (sillar), while surrounding areas provide access to hiking, mountaineering, and adventure tourism opportunities. The city's culinary scene combines traditional Arequipeña cuisine with contemporary restaurants and international options.
Altitude adjustment may affect some newcomers, as Arequipa sits at 2,335 meters above sea level, though most people acclimate within days or weeks. Spanish language skills are essential for daily life, as English proficiency remains limited outside tourist areas and international businesses.
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How does the property buying process work in Peru, step by step, especially for foreigners?
The property purchase process in Peru is straightforward for foreigners, who enjoy the same property rights as Peruvian citizens in most situations.
Begin by identifying potential properties through online platforms, real estate agencies, or direct owner contact. Major agencies like Century 21, local brokers, and websites such as Urbania, Adondevivir, and OLX Peru provide extensive listings. Viewing properties in person is essential, preferably with local representation to navigate language barriers and cultural nuances.
Legal verification represents the critical second step, requiring thorough due diligence on property titles, outstanding debts, legal restrictions, and proper registration with public records. Hire a qualified Peruvian lawyer specializing in real estate transactions to conduct these checks and review all documentation. This process typically takes 1-2 weeks for residential properties.
Negotiation and preliminary agreements follow successful due diligence. Buyers typically submit written offers including price, terms, and timeline. Upon acceptance, parties sign a preliminary contract (contrato de arras) specifying conditions, deposit amount (usually 10% of purchase price), and completion timeline. This contract legally binds both parties to the transaction.
Final execution occurs before a notary public, where all parties sign the definitive purchase deed (escritura pública). The notary verifies identity, legal capacity, and document authenticity. Following signature, the deed must be registered with the public registry (Registros Públicos) to complete legal ownership transfer.
Total costs typically range 4-5% of purchase price, including transfer taxes, notary fees, registry fees, and legal representation. Cash purchases are common, though mortgage financing is available for foreigners with proper documentation and typically carries interest rates of 9-15% annually.
Where can I find available properties for sale in Arequipa—are there trusted real estate agencies or websites?
Multiple reliable channels exist for finding properties in Arequipa, ranging from international platforms to local specialists with deep market knowledge.
International real estate platforms including Realtor.com International, FazWaz, and Century 21 Global maintain Arequipa listings with English-language support and international buyer services. These platforms often feature higher-end properties and provide standardized presentation formats familiar to foreign buyers.
Local Peruvian websites offer broader inventory and competitive pricing. Urbania serves as Peru's leading real estate portal with extensive Arequipa coverage, while Adondevivir and OLX Peru provide additional options including direct owner sales. These Spanish-language platforms require translation but often feature properties not listed on international sites.
Established real estate agencies in Arequipa offer personalized service and local market expertise. Century 21 operates multiple offices with bilingual agents, while local firms provide specialized knowledge of specific neighborhoods and property types. Working with licensed local agents helps navigate legal requirements and cultural considerations while providing access to off-market opportunities.
Rental platforms like Airbnb can provide insights into short-term rental potential and neighborhood characteristics, helping investors identify promising areas for purchase. Some property owners use these platforms to test market interest before listing for sale.
Direct networking through expat communities, local business associations, and professional contacts often reveals unique opportunities. Many successful transactions originate through personal referrals and word-of-mouth recommendations within Arequipa's business community.
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.
If I have a specific budget, say $50K, $100K, or $200K, what kind of property can I realistically get in Arequipa?
Budget constraints significantly influence property options in Arequipa, but each price range offers viable opportunities for different buyer profiles.
With a $50,000 budget, buyers can access small apartments or houses in affordable neighborhoods like Paucarpata, Mariano Melgar, or Hunter. These properties typically include 1-2 bedrooms, basic amenities, and may require minor renovations. Location choices favor areas with good public transportation access and essential services, though some compromise on prestige or luxury features may be necessary.
A $100,000 budget opens opportunities for larger apartments, townhouses, or small houses in up-and-coming areas such as José Luis Bustamante y Rivero, Sachaca, or Cerro Colorado. These properties often feature 2-3 bedrooms, modern amenities, parking spaces, and better neighborhood infrastructure. This price range allows for properties in transitional areas experiencing growth and development.
$200,000 provides access to spacious houses, luxury apartments, or prime investment properties in high-end districts like Cayma or Yanahuara. These properties typically include 3-4 bedrooms, premium finishes, security features, garden spaces, and locations in established neighborhoods with excellent amenities and infrastructure.
Each budget level offers rental income potential, though yields vary inversely with property values. Lower-priced properties generally provide higher rental yields but may require more active management, while expensive properties offer stability and prestige with more modest returns.
It's something we develop in our Peru property pack.
1. **$50,000 Budget Options:** - Studio or 1-bedroom apartment in Paucarpata - Small house needing renovation in Mariano Melgar - Apartment near university areas - Basic commercial space for rental investment - Land plot in developing areas2. **$100,000 Budget Options:** - 2-bedroom apartment in José Luis Bustamante - Townhouse in Sachaca with parking - Renovated colonial property in central areas - Small commercial building - Larger land plot with development potential3. **$200,000 Budget Options:** - 3-bedroom house in Cayma with garden - Luxury apartment in Yanahuara - Historic property in premium central location - Multi-unit rental property - Commercial space in prime business districtWhat are the common mistakes foreigners or investors make when buying property in Arequipa, and how can I avoid them?
Several recurring mistakes can significantly impact foreign property buyers in Arequipa, but awareness and preparation help avoid these pitfalls.
Inadequate legal due diligence represents the most serious error, as property titles, liens, and legal restrictions require careful verification. Always engage a qualified Peruvian lawyer specializing in real estate before making any commitments. Verify property ownership through public records, check for outstanding debts or legal disputes, and ensure all necessary permits and documentation are current and authentic.
Underestimating total costs beyond purchase price catches many buyers unprepared. Budget for transfer taxes (typically 3% of value), notary fees, lawyer fees, registry costs, and immediate maintenance or renovation needs. Additionally, consider ongoing expenses including property taxes, security, utilities, and potential homeowners' association fees.
Relying solely on online research without local market knowledge leads to poor location choices and overpaying. Visit neighborhoods at different times and days, understand transportation access, verify amenities and services, and assess future development plans that might affect property values. Local real estate agents provide invaluable insights into micro-market conditions and neighborhood dynamics.
Rushing transactions due to limited visit time or emotional attachment often results in inadequate inspection and negotiation. Take sufficient time for thorough property evaluation, structural inspection, and price comparison with similar properties. Market conditions generally favor patient buyers who can negotiate effectively.
Ignoring currency exchange risks and financing implications can create unexpected costs. Plan for peso-dollar exchange rate fluctuations, understand mortgage terms and requirements for foreigners, and consider keeping funds in local currency to avoid conversion timing issues.
If I plan to rent out the property, what's better: long-term or short-term rentals in Arequipa—and what are the rules, returns, tenant profiles, and best areas for each?
Both long-term and short-term rental strategies offer advantages in Arequipa's dynamic rental market, with success depending on property location, management capacity, and investor objectives.
Long-term rentals provide stable income streams with less management intensity, typically attracting students, young professionals, mining workers, and small families. Average gross rental yields hover around 5.99%, with contracts usually spanning 12 months and rent increases tied to inflation. Tenant profiles include university students near campus areas, professionals working in mining or services, and young families seeking affordable housing. Best areas for long-term rentals include neighborhoods near universities, business districts, and residential areas with good transportation access.
Short-term rentals offer higher potential returns, especially in tourist-friendly areas, but require more active management and marketing. Properties near the historic center, Yanahuara, and Cayma perform well for vacation rentals, targeting tourists visiting Arequipa's UNESCO World Heritage sites, business travelers, and digital nomads. Returns can reach 8-12% gross yield during peak seasons, though occupancy varies seasonally and requires professional photography, cleaning services, and guest communication.
Regulatory environment for short-term rentals remains relatively permissive, though owners must register with tax authorities and collect appropriate taxes from guests. Long-term rentals benefit from tenant protection laws that provide stability but limit rent increase frequency and eviction processes.
Success factors for long-term rentals include reliable tenants, minimal vacancy periods, and steady appreciation over time. Short-term rental success depends on excellent guest reviews, competitive pricing, professional management, and strategic location near attractions or business centers. Many investors use hybrid approaches, adjusting strategy based on seasonal demand and market conditions.
| Rental Strategy | Best Locations | Tenant Profile | Expected Yield |
|---|---|---|---|
| Long-term Residential | University areas, suburbs | Students, families, professionals | 5-7% annually |
| Short-term Tourism | Historic center, Yanahuara | Tourists, business travelers | 8-12% annually |
| Corporate Housing | Business districts | Mining executives, consultants | 6-9% annually |
| Student Housing | Near universities | Local and international students | 7-9% annually |
| Digital Nomad | Central, well-connected areas | Remote workers, freelancers | 6-10% annually |
| Extended Stay | Residential neighborhoods | Temporary workers, relocating families | 5-8% annually |
| Luxury Rentals | Premium districts | Wealthy professionals, expatriate executives | 4-7% annually |
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 in 2025 presents compelling opportunities for both investors and those seeking to relocate to Peru's cultural capital. With property prices forecast to rise 9% this year and rental yields averaging nearly 6%, the market fundamentals support both capital appreciation and income generation strategies.
The city's growing population, strong economic base, and affordable cost of living create an attractive environment for property ownership. Whether purchasing a $50,000 starter property or a $200,000 luxury home, buyers can find suitable options across diverse neighborhoods, each offering distinct advantages and investment potential in this dynamic South American market.
Sources
- Realtor.com International - Arequipa Properties
- Airbnb - Arequipa Condos
- Overseas Property Alert - Arequipa Real Estate
- Rentberry - Houses for Sale in Arequipa
- FazWaz - Arequipa Properties for Sale
- Kurby AI - Affordable Neighborhoods in Arequipa
- TheLatinvestor - Arequipa Real Estate Market
- Numbeo - Property Investment in Arequipa
- International Living - Living in Arequipa
- Global Property Guide - Peru Buying Guide