Authored by the expert who managed and guided the team behind the Uruguay Property Pack
Yes, the analysis of Montevideo's property market is included in our pack
As of September 2025, Montevideo presents one of the most stable and transparent property markets in South America.
With property prices averaging US$2,420–US$3,500 per square meter and gross rental yields reaching 4.97–6%, the Uruguayan capital offers compelling opportunities for both investors and lifestyle buyers seeking moderate entry costs and solid returns.
If you want to go deeper, you can check our pack of documents related to the real estate market in Uruguay, based on reliable facts and data, not opinions or rumors.
Montevideo's property market is showing steady growth with 3-5% annual appreciation expected, supported by strong foreign demand and infrastructure investment.
The market offers competitive entry costs, transparent legal framework, and no restrictions for foreign buyers, making it an attractive regional option.
| Market Aspect | Current Status | Outlook |
|---|---|---|
| Average Price (citywide) | US$2,420–US$3,500/sqm | 3-5% annual growth |
| Premium Areas | US$3,500–US$4,260/sqm | Stable demand |
| Rental Yields | 4.97-6% gross | Steady tenant demand |
| Foreign Ownership | Full rights, no restrictions | Continued openness |
| Transaction Costs | 7-10% of property price | Stable |
| Market Stability | High (regional leader) | Continuing strength |
| Economic Environment | GDP growth 2.1-3.4% | Stable outlook |
What's the current average price per square meter in Montevideo?
As of September 2025, property prices in Montevideo range from US$2,420 to US$3,500 per square meter for apartments and mid-tier residences across the city.
Premium neighborhoods like Carrasco, Pocitos, Punta Carretas, and Malvín command higher prices between US$3,500 and US$4,260 per square meter. These areas offer the best amenities, proximity to the coast, and established infrastructure.
More affordable areas including Centro, Cordón, and Las Acacias start from approximately US$750 and go up to US$2,950 per square meter. These neighborhoods are experiencing growing demand from young professionals and investors seeking higher rental yields.
The pricing varies significantly based on building standards, location proximity to amenities, and property age. New developments with modern features typically command premium prices within each neighborhood category.
It's something we develop in our Uruguay property pack.
How have property prices in Montevideo changed over the past few years?
Montevideo's property market has shown steady but moderate growth over recent years, with 2.9% nominal growth recorded in the past 12 months ending in 2024.
The five-year trend reveals annual appreciation of 2-5% for most Montevideo properties, while luxury and coastal segments have performed better with 5-12% annual growth. The broader national market has consistently outperformed with 8% annual growth rates.
Real growth has trailed inflation in some periods, making the market more accessible for buyers while maintaining stability for existing owners. This controlled growth pattern indicates a healthy market without speculative bubbles.
Infrastructure investments and steady foreign demand have been key drivers supporting price appreciation. The market has avoided the dramatic swings seen in other regional capitals, maintaining investor confidence.
Looking at 2025 projections, experts expect annual appreciation of 3-5% to continue in Montevideo, supported by ongoing infrastructure development and sustained international buyer interest.
What are the experts predicting about the real estate market in Montevideo for the next year or two?
Market analysts forecast 3-5% annual appreciation for Montevideo's property market through 2026-2027, driven by infrastructure investment and sustained international buyer interest.
The market is viewed as stable and positioned for moderate, steady growth without signs of speculative activity. This outlook is based on strong economic fundamentals and continued foreign investment flows into Uruguay's real estate sector.
Infrastructure projects including port expansions, urban renewal initiatives, and transportation improvements are expected to support property values, particularly in emerging neighborhoods and areas undergoing redevelopment.
Demand patterns show sustained interest from both regional and international buyers, with no indication of market saturation. The stable political and economic environment continues to attract foreign investment.
Experts emphasize that Montevideo's growth trajectory remains sustainable and well-supported by underlying economic factors, making it one of the most predictable markets in the region.
How does the supply of properties compare to the current demand in Montevideo?
Demand remains strong in Montevideo's property market, with transaction volumes increasing 3.9% year-over-year in early 2024.
Residential sales are forecast to grow by 10% annually over the next three years, indicating robust and sustained buyer interest. Supply remains adequate with a steady flow of new development projects coming to market.
High demand particularly exists for properties with outdoor spaces, balconies, and terraces, which continue to absorb available inventory quickly. This trend has been consistent since the pandemic and shows no signs of slowing.
The market maintains a healthy balance where supply meets demand without creating oversupply conditions that could pressure prices downward. New construction projects are being planned and executed at a pace that matches market absorption rates.
Emerging neighborhoods and urban renewal districts are seeing particularly strong demand as buyers seek value opportunities while developers respond with appropriate new supply.
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What are mortgage interest rates like right now in Uruguay?
Uruguay's central bank policy rate stands at 9.00% as of July 2025, providing the baseline for lending rates across the financial system.
Mortgage interest rates currently range from 6% to 10% depending on the bank, loan profile, borrower qualifications, and loan-to-value ratios. These rates are considered competitive within the South American region.
Local banks offer various mortgage products with different terms, typically requiring 20-30% down payments for foreign buyers. Some banks provide more favorable rates for residents or those with established banking relationships.
The relatively stable interest rate environment in Uruguay, combined with the country's economic stability, makes mortgage financing accessible for qualified buyers. Rates have remained within this range for the past year without significant volatility.
Foreign buyers should expect to meet additional documentation requirements and may face slightly higher rates than local borrowers, though the differential is typically modest.
Are there any government incentives or restrictions affecting property purchases in Montevideo?
Uruguay offers various tax incentives for both local and foreign property buyers, particularly for new and energy-efficient construction projects.
Qualifying projects can receive up to 40% income tax exemption, along with full or partial exemptions from property transfer tax, VAT on purchase, and rental income taxes under the Promoted Housing Law (Law 18.795), which has been extended to December 2025.
The government operates a residency-by-investment program accessible with a minimum US$200,000 real estate investment, providing a pathway to Uruguayan residency for foreign buyers. There are no restrictions on foreigners buying, owning, or transferring real estate in Uruguay.
Foreign buyers enjoy the same legal rights and protections as local buyers, with transparent property registration and transfer procedures. The legal framework strongly protects property rights and foreign investment.
It's something we develop in our Uruguay property pack.
How stable is the Uruguayan economy and currency at the moment?
Uruguay maintains one of Latin America's most stable economic environments, with GDP growing at a steady 2.1-3.4% rate in 2025.
Inflation is forecasted to remain within the 4.5-5.4% range, close to central bank targets, demonstrating effective monetary policy management. The Uruguayan peso has maintained relative stability against major currencies.
The country's political environment is stable with strong democratic institutions and pro-business policies that consistently attract foreign investment. Legal and regulatory frameworks are well-developed and transparent.
Uruguay's economic diversification across agriculture, technology, financial services, and tourism provides resilience against external shocks. The banking system is well-regulated and maintains strong capital ratios.
International credit rating agencies consistently rate Uruguay as one of the region's most stable investment destinations, with minimal sovereign risk compared to neighboring countries.
What's the rental yield like in Montevideo, and is it easy to find tenants?
| Neighborhood | Gross Rental Yield | Tenant Demand |
|---|---|---|
| Citywide Average | 4.97% | Moderate to Strong |
| Malvín | 6%+ | High |
| Punta Carretas | 6%+ | High |
| Pocitos | 5-6% | High |
| Centro/Cordón | 5-7% | Strong |
| Ciudad Vieja | 5.5-6.5% | Growing |
| Carrasco | 4-5% | Selective but Stable |
Which neighborhoods in Montevideo are showing the most growth and demand?
Pocitos, Malvín, and Punta Carretas represent the most desirable neighborhoods with the best amenities and consistent price growth, attracting both local and international buyers.
Centro, Cordón, and Ciudad Vieja are experiencing rising demand from young professionals and investors seeking higher rental yields. These areas benefit from urban renewal projects and proximity to business districts.
Carrasco maintains its position as the premium luxury segment, attracting high-net-worth buyers seeking exclusive properties near the international airport and beach access.
Emerging urban renewal districts are showing the fastest appreciation rates as infrastructure improvements and development projects transform previously overlooked areas into attractive residential zones.
Coastal neighborhoods continue to command premium prices due to lifestyle appeal, while central areas offer the best value proposition for rental income generation.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Uruguay 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.
What are the typical transaction costs, taxes, and fees involved in buying a property there?
Total buyer costs in Montevideo typically range from 7-10% of the property purchase price, making it competitive with other regional markets.
The breakdown includes approximately 4% agent's commission, around 3.7% for notary and legal fees, 0.55% registration tax, and roughly 2% property transfer tax. These costs are generally split between buyer and seller according to standard practices.
Annual property taxes are relatively low at 0.15-0.30% of assessed value, collected by municipal authorities. Property tax assessments are typically below market values, keeping ongoing costs manageable.
Additional costs may include property inspection fees, title insurance (optional but recommended), and bank fees if using mortgage financing. Foreign buyers should budget for currency exchange costs and potential translation services.
The transaction process typically takes 30-60 days to complete, with clear legal procedures and transparent cost structures that are well-established in the market.
Are there any legal or regulatory hurdles for foreigners buying property in Uruguay?
Foreign buyers face the same rights and procedures as local buyers in Uruguay, with no minimum investment requirements or additional restrictions for foreign ownership.
The property registration and transfer procedures are transparent and well-established, typically taking 30-60 days to complete all legal requirements. No special permits or approvals are needed for foreign buyers.
Property rights are strongly protected under Uruguayan law, with clear title registration systems and established legal precedents. The judicial system effectively enforces property rights and contracts.
Foreign buyers can own property in any area of Uruguay without restrictions, including coastal properties and urban centers. There are no requirements for local partnerships or nominee structures.
It's something we develop in our Uruguay property pack.
How does buying in Montevideo compare to other cities in the region in terms of value and opportunity?
Montevideo offers moderate entry costs at US$2,420-$3,500 per square meter compared to Buenos Aires at US$2,460 average and Santiago at US$3,441+ per square meter.
Gross rental yields in Montevideo range from 4-6%, which is competitive with Buenos Aires (5-7%) and slightly better than Santiago (4.5-5.5%). However, Montevideo provides greater market stability and legal certainty.
Uruguay offers the most comprehensive legal framework for foreign investors among these regional capitals, with no capital controls or ownership restrictions that exist in other markets. Transaction costs are comparable at 7-10% across all three cities.
While Buenos Aires may offer higher growth potential due to recent market recovery, it comes with greater currency and political risk. Santiago provides similar stability to Montevideo but with higher entry costs and some foreign ownership restrictions.
Montevideo's combination of moderate entry costs, solid yields, transparent legal framework, and economic stability makes it particularly attractive for risk-conscious investors seeking steady returns and capital preservation.
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.
September 2025 represents an opportune time to invest in Montevideo's property market, with stable economic conditions, transparent legal framework, and competitive pricing supporting both investor and lifestyle buyer objectives.
The combination of moderate appreciation potential, solid rental yields, and minimal regulatory barriers positions Montevideo as one of South America's most accessible and reliable property markets for international buyers.
Sources
- Uruguay Price Forecasts
- Montevideo Price Forecasts
- Montevideo Best Neighborhoods
- Average House Price in Uruguay
- Global Property Guide Uruguay Home Price Trends
- Real Estate in Uruguay Market Insights 2025
- La Cite Uruguay Property Investment Opportunities 2025
- Montevideo Real Estate Market
- Trading Economics Uruguay Interest Rate
- Uruguay Buy Property