Is it worth it buying property in Arequipa in 2025?

Authored by the expert who managed and guided the team behind the Peru Property Pack

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THE LATINVESTOR

A team specialized in real estate investing in LATAM countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Arequipa. If you'd like to learn more about us, you can check our presentation page.

What types of properties are available to buy in Arequipa right now?

Arequipa's property market offers four main categories that cater to different budgets and preferences as of September 2025.

Apartments are the most common option, particularly in central districts like Cayma, Yanahuara, and the historic city center. These range from compact 1-bedroom units starting around $115,000 USD for mid-range 3-bedroom apartments, up to $330,000 USD for newer, larger units in popular districts. Most apartments feature modern amenities and are ideal for both residents and rental investors.

Single-family houses dominate the broader market, available citywide but especially concentrated in neighborhoods like Cayma, Cerro Colorado, and José Luis Bustamante y Rivero. The price spectrum is remarkably broad, starting from $75,000 USD for smaller homes in outer areas and reaching up to $954,000 USD for luxury residences in premium locations. These properties often include private gardens and parking, making them attractive to families.

Luxury properties represent the high-end segment, featuring upscale homes and penthouses primarily in Cayma, Yanahuara, and select parts of Sachaca and the city center. These typically exceed $430,000 USD and can reach nearly $1,000,000 USD for exclusive listings with premium finishes and prime locations.

Land and development plots offer opportunities for custom construction, mainly available toward the city's periphery starting around $56,000 USD for smaller parcels. These attract investors and developers looking to build custom properties or capitalize on Arequipa's urban expansion.

How do property prices compare between the past few years, today, and the forecast for 2025?

Arequipa's property market has shown consistent strength, significantly outperforming national trends and even Lima's market growth.

From 2022 to 2024, property prices in Arequipa grew between 4.5% and 9% annually, substantially exceeding Peru's national inflation rate and growth patterns seen in Lima. By 2024, the median price per square meter reached approximately $950 USD, establishing a steady upward trajectory that attracted both local and international attention.

As of September 2025, the median residential property price stands at S/1,890,000 (approximately $500,000 USD), with average new apartments priced at S/451,000 ($120,000 USD) for 87 square meters. Prices have increased 9% year-over-year, driven primarily by urbanization trends, demand consistently outpacing supply, and broader economic expansion in southern Peru.

The forecast for the remainder of 2025 and into 2026 projects continued upward momentum with 9% annual price increases expected. This growth is supported by constrained supply in desirable areas, strong demographic trends favoring urban centers, and increased interest from both domestic and foreign buyers. Well-located mid-range districts are expected to lead this appreciation, making them particularly attractive for investment purposes.

It's something we develop in our Peru property pack.

Which neighborhoods are considered affordable, which ones are up-and-coming, and which ones are more upscale, and what are the pros and cons of each?

How does the cost of living in Arequipa compare to other major cities in Peru and South America?

Arequipa offers exceptional value compared to other major South American cities, making it attractive for both expats and investors.

Compared to Lima, Arequipa is 20-30% less expensive across most categories. Rent for a city-center apartment averages around $650 per month in Arequipa versus $1,200 in Lima. Typical expat monthly budgets range from $700-$1,200 in Arequipa compared to $1,500-$2,500 in Lima, representing substantial savings for international residents.

Daily living costs reflect this affordability advantage. Meals in local eateries cost $2-5, while restaurant dining ranges from $8-20. Local transportation is remarkably affordable, and utilities plus groceries run 25-40% below capital city costs. These savings compound significantly over time for residents and impact rental yield calculations for investors.

Compared to Cusco, Arequipa is 15-20% cheaper while offering better infrastructure and amenities. The city provides colonial architecture, abundant sunshine, mild climate, and friendly locals alongside reliable basic healthcare. However, it offers fewer international amenities and services compared to Lima's cosmopolitan offerings.

Against regional South American cities, Arequipa competes favorably with similar-sized urban centers in Bolivia, Ecuador, and northern Chile, often providing better infrastructure and stability at comparable or lower costs.

Is it generally smarter to buy or rent in Arequipa in 2025?

The decision between buying and renting in Arequipa depends heavily on your timeline, financial situation, and investment goals.

Buying makes strong financial sense for several reasons. Property price growth in Arequipa consistently outpaces inflation, with current 9% annual increases meaning buyers benefit from rising asset values. Gross rental yields remain healthy at approximately 6%, so purchasing provides both income potential and capital appreciation. For medium to long-term residents (3+ years), buying typically proves more economical than renting equivalent properties.

The rental market faces upward pressure, meaning rental costs are likely to increase over time, making early purchase more attractive. Current mortgage rates range from 7.4-15%, but strong property appreciation often exceeds these borrowing costs. Foreign buyers face no ownership restrictions, simplifying the purchase process.

Renting offers advantages for specific situations. It provides lower monthly costs and complete flexibility, ideal for short stays, trial periods, or avoiding high mortgage interest rates. Renting eliminates property maintenance responsibilities and allows easier relocation if circumstances change.

For investors, buying clearly wins due to appreciation potential and rental income. For residents planning to stay 2+ years, buying typically provides better long-term value. Only short-term residents (under 18 months) should consider renting as the primary option.

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What's the step-by-step process for buying property in Arequipa as a foreigner?

Foreign property purchase in Arequipa follows a straightforward legal process with no ownership restrictions for most properties.

1. Property Selection and Negotiation: Choose your desired property and neighborhood, work with trusted agents, and negotiate price and terms with the seller.
2. Reservation Contract (Bloqueo de Venta): Sign a reservation agreement and pay a deposit (typically 5-10% of purchase price) to secure the property while completing due diligence.
3. Due Diligence Phase: Conduct thorough legal review including notary examination of the title deed (escritura pública), verification with land registry (SUNARP), checking for unpaid taxes, liens, or legal disputes.
4. Private Sale Contract (Contrato de Compraventa): Sign the final purchase contract at a notary office and pay the remaining purchase price, minus the initial deposit.
5. Official Registration: Submit the signed contract to SUNARP for official property registry. Pay transfer taxes (approximately 3% of purchase price), notary fees, and registration costs.
6. Title Transfer Completion: Receive your official property certificate with the title transferred and property registered in your name.
7. Property Handover: Take possession of the property, complete utility transfers, and begin occupancy or rental preparation.

Foreigners face no restrictions except for properties in border areas or strategic zones. Professional translation services are essential for all documents, and retaining a bilingual lawyer or trusted local agent is strongly recommended to navigate bureaucratic requirements efficiently.

Where can you actually find properties for sale—what real estate agencies or platforms are the most reliable?

Arequipa property listings are available through both international platforms and local agencies, each offering different advantages for foreign buyers.

International platforms provide the easiest starting point for overseas buyers. Realtor.com, LuxuryEstate.com, Rentberry, and Realestate.com.au all feature Arequipa properties ranging from budget options to luxury residences. These platforms offer English-language interfaces, international payment options, and familiar browsing experiences for foreign buyers.

Local agencies often provide better pricing and insider knowledge of available properties. Search for "inmobiliaria Arequipa" to find established local firms. Recommended agencies typically have strong online presence, positive reviews, and bilingual capabilities. Local agents often know about properties before they reach international platforms and can negotiate better deals.

Direct property searches work well in Arequipa's compact urban core. Walking through target neighborhoods often reveals "For Sale" signs on desirable properties not yet listed online. This approach allows buyers to assess neighborhood dynamics firsthand while discovering potential opportunities.

Professional networks including lawyers, notaries, and expat communities provide valuable referrals to trustworthy agents and properties. Many successful purchases result from recommendations within these professional and social circles.

It's something we develop in our Peru property pack.

What types of properties can you realistically afford depending on different budget ranges?

What are the most common mistakes people make when buying property in Arequipa, and how can you avoid them?

Property buyers in Arequipa commonly make several avoidable mistakes that can prove costly and time-consuming.

1. Skipping SUNARP title verification: Always verify ownership and check for liens through the official land registry. This prevents disputes and ensures clear title transfer.
2. Underestimating total costs: Budget beyond purchase price for legal fees, taxes (3%), notary costs, and registration fees. These typically add 5-8% to the total investment.
3. Proceeding without proper translation: Use official translation services for all documents if not fluent in Spanish. Legal terminology requires precision to avoid misunderstandings.
4. Relying solely on online photos: Always visit properties in person to assess actual condition, neighborhood dynamics, and potential issues not visible in marketing materials.
5. Overpaying in tourist-focused areas: Research comparable sales and avoid inflated pricing in highly-demanded central districts or areas specifically marketed to foreigners.
6. Ignoring future value considerations: Factor in rental potential, resale prospects, and neighborhood development trends when making purchase decisions.
7. Working without local professional support: Engage trusted local agents, lawyers, and notaries who understand regional practices and can navigate bureaucratic requirements efficiently.

Success requires thorough due diligence, professional support, and realistic expectations about timelines and costs involved in international property transactions.

What's life like as an expat in Arequipa in terms of community, safety, healthcare, and lifestyle?

Expat life in Arequipa offers a unique blend of affordability, culture, and quality of life that appeals to retirees, digital nomads, and international professionals.

The expat community is smaller but vibrant, consisting primarily of retirees, digital nomads, students, and some business professionals. While less cosmopolitan than Lima, the local population is notably friendly and welcoming to foreigners. Active social scenes center around central plazas, cafes, and cultural events, making it relatively easy to build connections and integrate into local life.

Safety levels are generally good, significantly better than Lima or Trujillo, though standard urban precautions apply. Central neighborhoods like Cayma and Yanahuara are considered very safe, while peripheral areas require more awareness. Crime typically involves petty theft rather than violent incidents, and most expats report feeling secure in daily activities.

Healthcare infrastructure includes good local clinics and basic hospital facilities suitable for routine care and minor emergencies. However, serious medical conditions may require travel to Lima for specialized treatment. Many expats maintain international health insurance to ensure access to Lima's advanced medical facilities when needed.

Lifestyle advantages include excellent year-round weather, proximity to outdoor adventures like Colca Canyon and volcano hiking, stunning colonial architecture, vibrant local festivals, and remarkably affordable dining and transportation. The city provides authentic Peruvian cultural immersion while maintaining modern amenities. Downsides include fewer international services, occasional bureaucratic challenges, and limited direct international transportation connections.

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 you want to rent out long term, which areas should you target, what kind of tenants are looking, and what's the typical rental income and yield?

Long-term rental success in Arequipa depends heavily on targeting the right locations and understanding tenant demographics.

Central districts including Yanahuara, Cayma, and the City Center perform best for long-term rentals, attracting professionals, families, and expats who prioritize walkability and amenities. These areas typically generate gross yields of 5.5-6%, with strong tenant demand and lower vacancy rates. Properties in these locations command premium rents due to safety, convenience, and infrastructure quality.

Outer districts like José Luis Bustamante y Rivero and Sachaca cater primarily to students and young families seeking affordability. While rental rates are lower, these areas offer steady demand and reliable returns, particularly near universities and schools. Student housing generates consistent income during academic years but may experience seasonal vacancy.

Tenant demographics include local professionals working in Arequipa's growing service and tourism sectors, university students and faculty, some remote workers attracted by the city's affordability, and small numbers of expats and digital nomads. Long-term tenants typically prefer furnished or semi-furnished properties with reliable internet, modern appliances, and security features.

Typical rental yields range from 5.5-6% gross in prime central locations, with potential for higher returns in well-managed properties targeting specific demographics. Properties near universities or in up-and-coming neighborhoods like Sachaca may achieve slightly higher yields due to lower purchase prices relative to rental income potential.

If you want to rent out short term, what areas and property types work best, what do travelers expect, what regulations should you know about, and what kind of returns can you expect?

Short-term rental success in Arequipa requires strategic location selection and understanding of traveler expectations and local regulations.

The best areas for short-term rentals are the Historic City Center for cultural tourists, Yanahuara for its colonial charm and views, and Cayma for modern amenities and upscale accommodations. These locations provide easy access to attractions, restaurants, and transportation while offering the authentic Arequipa experience tourists seek.

Ideal property types include well-appointed apartments with character, houses with outdoor spaces or views, and boutique-style accommodations near main plazas and cultural sites. Properties should emphasize unique architectural features, mountain or city views, and proximity to tourist attractions while maintaining modern comfort standards.

Traveler expectations center on central locations within walking distance of attractions, reliable high-speed WiFi for digital nomads, modern furnishings and appliances, consistent hot water and heating, and security features including safe neighborhoods and property access controls. Many guests appreciate local cultural touches and detailed area recommendations from hosts.

Regulatory requirements include formal registration for tax purposes, compliance with municipal noise and safety regulations, and potential additional permits for tourist accommodations. Property owners must maintain proper insurance, meet fire safety standards, and follow local zoning rules for short-term rentals.

Returns can reach up to 10% gross yield during peak tourist seasons, though performance varies significantly during off-peak periods. Success depends heavily on property management quality, marketing effectiveness, guest services, and seasonal demand fluctuations. Well-managed properties in prime locations typically achieve higher occupancy rates and premium pricing.

It's something we develop in our Peru property pack.

Finally, overall, is it worth buying property in Arequipa in 2025—whether for living, renting out, or buying to resell later at a higher price?

Arequipa represents one of Peru's most compelling property investment opportunities in 2025, offering strong fundamentals across multiple investment strategies.

For personal residence, Arequipa delivers exceptional value with significantly lower living costs than Lima, stable asset appreciation, and high quality of life. The combination of affordable property prices, excellent weather, rich culture, and growing expat community makes it ideal for medium to long-term settlement. Property ownership provides inflation protection and potential appreciation while offering lifestyle benefits unavailable in more expensive cities.

For rental investment, both short and long-term strategies show promise. Healthy yields of 5.5-6% for long-term rentals provide steady income, while short-term rentals can achieve up to 10% gross yields in peak seasons. Strong local demand from students, professionals, and growing tourism supports consistent rental income. The key is selecting appropriate properties in target neighborhoods for your chosen rental strategy.

For capital appreciation, Arequipa's 9% annual price growth significantly outpaces inflation and most alternative investments. Projected continued growth driven by supply constraints, urbanization trends, and economic development makes it attractive for buy-and-hold appreciation strategies. Up-and-coming neighborhoods like Sachaca offer particular potential for above-average returns.

Risk factors include potential political and economic volatility affecting Peru broadly, supply constraints that could eventually limit price growth, and market liquidity that may be lower than major international markets. However, these risks are generally manageable for informed investors with proper due diligence and realistic expectations.

The conclusion is clear: Arequipa in 2025 remains one of South America's best-value urban property markets, offering opportunity across residence, rental, and appreciation strategies. Success requires local knowledge, professional guidance, and thorough market understanding, but the fundamentals strongly support property investment in this growing regional center.

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.

Sources

1. Realtor.com - Arequipa Properties
2. LuxuryEstate.com - Arequipa Luxury Properties
3. RealEstate.com.au - Arequipa Market
4. TheLatinvestor - Arequipa Price Forecasts
5. TheLatinvestor - Peru Price Forecasts
6. Girl on a Zebra - Arequipa Neighborhoods
7. TheLatinvestor - Arequipa Real Estate Forecasts
8. Armenian Lawyer - Peru Cities Comparison
9. Armenian Lawyer - Living Costs Peru
10. TheLatinvestor - Living in Peru as American