How is the property market forecast in Montevideo?

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

Who is the author of this content?

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 Montevideo. If you'd like to learn more about us, you can check our presentation page.

What's the current state of property prices in Montevideo right now?

As of September 2025, Montevideo's property market shows a healthy pricing structure with clear neighborhood segmentation.

Citywide average property prices range between $2,420 and $3,500 per square meter, depending on location and property type. Prime coastal districts command the highest premiums, with Carrasco leading at $4,260 per sqm, followed by Punta Carretas and Pocitos at $3,500-$4,000 per sqm.

Central Montevideo offers more accessible entry points, with Centro starting around $2,800 per sqm, while peripheral areas like Las Acacias and Peñarol provide budget options in the $750-$875 range. The median home price for standard single-family homes and apartments sits at $167,000-$180,000, making Montevideo relatively affordable compared to other regional capitals.

This pricing structure reflects the city's mature market dynamics, where location, amenities, and proximity to the coast drive significant value differentials.

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

How have prices evolved over the past 12 months compared to previous years?

Montevideo's property market has returned to steady, sustainable growth after the pandemic-era volatility.

Property prices rose 2.9% during the past year, a significant improvement from the modest 0.9% growth seen in 2023. This represents a return to more normal appreciation patterns after the dramatic swings experienced during 2020-2022, when annual increases varied from lows of 0.9% to peaks of 9.7% in 2021.

The coastal and gentrifying urban neighborhoods have outperformed the city average, with areas like Malvín, Ciudad Vieja, Carrasco, Pocitos, and Punta Carretas experiencing price growth in the 4-10% range, particularly for properties with outdoor space. This differential performance reflects growing buyer preference for lifestyle amenities and quality locations.

The market has stabilized from the speculative pressures of the pandemic years, with current growth rates suggesting a healthy, demand-driven appreciation cycle rather than bubble conditions.

What's the short-term forecast for the next 6 to 12 months?

The Montevideo property market is positioned for continued moderate appreciation through mid-2026.

Prices are projected to rise 2-4% over the next 6-12 months, driven by sustained foreign investment, ongoing urban renewal projects, and Uruguay's economic stability. The market shows no signs of speculative overheating, with demand supported by fundamental factors rather than investor speculation.

Foreign buyer interest remains strong, particularly from Argentine and Brazilian investors seeking stable assets, while local demand continues from young professionals and growing families. The upcoming completion of several infrastructure projects, particularly in urban renewal zones, is expected to provide additional price support.

Market liquidity remains healthy, with well-located properties continuing to sell within 40-61 days on average, indicating balanced supply and demand conditions.

What's the medium-term outlook for the next 2 to 3 years?

Montevideo's property market outlook through 2027-2028 shows promising fundamentals for sustained growth.

Forecasts indicate steady appreciation of 3-5% annually until 2027, with neighborhoods benefiting from infrastructure improvements and urban renewal projects likely to outperform. The city's ongoing investment in public transportation, coastal development, and historic district revitalization will create value-enhancing catalysts for property owners.

Residential property transaction volumes are expected to grow approximately 10% annually, signaling a robust and expanding marketplace. This growth will be supported by Uruguay's stable political environment, growing expat community, and the country's attraction as a regional financial and technology hub.

The rental market will benefit from continued urbanization and foreign resident growth, maintaining healthy yield levels for investors while supporting price appreciation through strong underlying demand.

Don't lose money on your property in Montevideo

100% of people who have lost money there have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.

Download Now

What are the long-term projections for the next 5 to 10 years?

The long-term outlook for Montevideo's property market through 2035 shows continued stable expansion with attractive growth potential.

Annual appreciation of 3-5% is expected over the next decade, driven by GDP growth, population expansion, and sustained foreign interest in Uruguay as a stable investment destination. The luxury coastal segments and emerging neighborhoods could outperform with even higher growth rates, though the market is not expected to experience overheating.

Montevideo's position as Uruguay's economic and cultural center will support long-term demand, particularly as the country continues developing its technology sector and attracting international businesses. The city's infrastructure investments, including port modernization and smart city initiatives, will enhance its appeal to both residents and investors.

Climate change considerations may actually benefit Montevideo's market, as the city's temperate climate and coastal location become increasingly attractive to regional and international buyers seeking stable, livable environments.

Which neighborhoods are showing the strongest growth and which are stagnating?

How do apartments compare to houses in terms of pricing trends and demand?

Apartments significantly outperform houses in both pricing trends and investment demand in Montevideo's current market.

Modern apartments in prime neighborhoods command the highest prices per square meter, typically ranging from $3,500-$4,260 in coastal areas, while benefiting from strong urban living trends and investor preference. Apartments offer better liquidity, higher rental yields, and stronger price appreciation, particularly those with outdoor spaces like balconies or terraces.

Houses, while preferred by families seeking space, show more modest appreciation and typically align with market median prices of $167,000-$180,000. Suburban houses offer more living space but generally lag in appreciation compared to centrally located apartments, making them better suited for owner-occupiers than investors.

The rental market strongly favors apartments, with higher yields and faster tenant placement, while houses face longer rental periods and more maintenance responsibilities that can impact net returns.

What's the average budget required to buy in central Montevideo versus suburban areas?

The budget requirements vary significantly between central and suburban Montevideo, reflecting distinct market segments.

Central neighborhoods require $167,000-$250,000 for standard apartments in prime locations like Pocitos and Punta Carretas, with Centro offering more accessible entry points around $137,000 for smaller units. These central properties offer the best combination of liquidity, rental demand, and appreciation potential.

Suburban areas typically require $180,000-$300,000 for larger family homes, depending on land size and amenities. While offering more space, these properties generally provide lower liquidity and yields compared to central apartments. The most affordable suburban options can be found below $100,000 in outlying districts, but these come with significantly reduced liquidity and growth potential.

For investment purposes, the central apartment market offers better risk-adjusted returns, while suburban houses serve family buyers prioritizing space over investment performance.

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

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.

How strong is the rental market right now, and what rental yields can buyers expect by area?

Montevideo's rental market demonstrates robust strength with attractive yields across multiple segments.

Gross rental yields average 4.97% citywide as of Q2 2025, ranging from 4% in luxury districts like Carrasco to over 6.7% in high-demand areas like Malvín. This yield range compares favorably to other regional capitals and provides solid income streams for property investors.

The short-term rental market through Airbnb shows exceptional performance, with median gross returns around $825 monthly and top-performing properties exceeding $1,800 monthly. Occupancy rates average 48% citywide but can exceed 70% for well-managed, strategically located units, with peak months reaching 61.7% occupancy and daily rates of $73-$120.

Long-term rental demand remains strong, driven by expat growth and young professionals, particularly in neighborhoods like Pocitos, Malvín, and Cordón. This sustained demand supports both yield levels and occupancy rates, making rental property investment particularly attractive in these areas.

What's the liquidity like — how quickly do properties sell depending on location and type?

Montevideo's property market offers good liquidity with clear performance differences by location and property type.

Properties citywide typically sell within 40-61 days on average, with premium locations significantly outperforming this benchmark. Hot properties in neighborhoods like Pocitos, Malvín, and Ciudad Vieja can sell in as little as 16-23 days, particularly modern apartments with attractive features like outdoor space or recent renovations.

Well-located, modern apartments demonstrate the best liquidity, especially those in coastal or gentrifying urban areas. Properties further from the center or in peripheral suburban areas may require 60+ days to sell and often face more limited buyer pools, impacting both sale speed and price negotiation power.

The liquidity advantage of central apartments over suburban houses has become more pronounced, making location and property type critical factors for investors prioritizing exit flexibility and capital preservation.

What are the best opportunities today if you're buying to live, to rent out, or to resell later?

1. To Live: Malvín and Pocitos offer the optimal blend of lifestyle amenities, safety, and appreciation potential, particularly suitable for small families or young professionals seeking quality of life and investment protection.
2. To Rent Out: Centro and Cordón provide the highest yields with steady rental demand, optimal for income-focused investors seeking strong cash flow from both long-term and short-term rentals.
3. To Resell Later: Ciudad Vieja and urban renewal zones promise outsized appreciation for buyers targeting value-add properties before area improvements reach full maturity and price recognition.
4. Balanced Investment: Modern apartments in Pocitos or Malvín provide the best combination of moderate appreciation, solid yields, and good liquidity for well-rounded investment strategies.
5. Value Play: Centro offers strong upside potential with urban renewal momentum, competitive pricing, and growing demand from young professionals and expats.

Given all these factors, where and what type of property should a buyer focus on right now?

Strategic buyers in September 2025 should focus on modern apartments in coastal or urban renewal neighborhoods for optimal risk-adjusted returns.

The ideal investment targets are modern apartments in Pocitos, Malvín, or revitalizing areas like Centro and Ciudad Vieja, which offer a balanced combination of capital growth potential, strong liquidity, and attractive rental income. These areas provide 4.5-6.7% rental yields while maintaining appreciation potential of 3-5% annually.

For yield-focused investors, Malvín and Cordón represent the sweet spot, combining reasonable entry prices with yields above 6% and strong rental demand. These neighborhoods offer better value than premium areas while maintaining good growth prospects and tenant appeal.

Buyers should prioritize properties with outdoor spaces, modern amenities, and proximity to transportation links, as these features drive both rental demand and resale value. Avoid peripheral areas like Las Acacias unless seeking purely budget-driven investments with limited growth expectations.

The market timing remains favorable, with stable economic conditions, reasonable interest rates, and no signs of speculative overheating creating a healthy environment for long-term property investment.

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

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. The LatinVestor - Montevideo Property Analysis
2. The LatinVestor - Montevideo Price Forecasts
3. The LatinVestor - Uruguay Price Forecasts
4. The LatinVestor - Montevideo Best Neighborhoods
5. The LatinVestor - Average House Price in Uruguay
6. Global Property Guide - Uruguay Price History
7. The LatinVestor - Montevideo Real Estate Market
8. Real Estate in Uruguay - Best Areas 2025
9. Global Property Guide - Uruguay Rental Yields
10. AirROI - Montevideo Short-term Rental Report