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Renting Property

Peru - Renting Property

Renting is always a good way to settle into a new country, while you decide if you’ve found the right location for you. In addition, the property market in Peru is fraught with difficulty, which makes renting an attractive proposition. There are several difficulties and financial risks to purchasing property in Peru.

• Homes for single people are rare, as most Peruvians only move out of the family home when they get married
• Nicely appointed homes in good areas of Lima can cost millions as there are plenty of international buyers to purchase them
• It is alleged that property is a good way to launder money used for criminal activities such as drug deals, driving up property prices
• Some families don’t have clear title of the land and buildings they are selling
• The buying process is bureaucratic
• The risk of being ripped off means you have to employ professionals to double check everything
• There are a several taxes charged to property owners both on purchase of the property and each year of ownership

Reflecting the astonishing rate at which property prices have risen, rental costs in Peru have also increased over the past few years. However, the rate of increase is slowing as there are fewer people looking to rent; this is combined with the depreciation of the Peruvian Nuevo Sol (PEN), as rental prices in Lima are normally fixed in US dollars. Medium size properties have a higher yield for landlords than larger properties, reflecting more popular rental demand.

With almost eight and a half million residents, Lima is the largest city in the country. It is a busy, cosmopolitan location, and home to the most upscale property market available in Peru. Large houses and high rise flats are available to those who can afford them. It is also the location most likely to offer professional employment to expats. Wherever you live in Lima, you will come into daily contact with people who are extremely poor. You should avoid living in the slum developments around the edge of Lima as you will not be safe there. Modestly priced areas may present occasional challenges in terms of access to services such as broadband and hot water. You won’t find anything under $400 per month, and may well pay over $3,000 for a large apartment. Furniture, appliances and utilities will all be on top of the rent.

The second largest city in Peru is Trujillo, in the northwest. Its 920,000 residents have easy access to surfing and water-sports activities.

The southern city of Arequipa, often called the white city, has a population of almost 850,000 people. It’s much easier to get around than Lima, and the cost of living is lower.

Located in the rainforest, Arequipa’s population of 450,000 people rises each year as a result of visiting tourists. It is a multi-ethnic city, whose neighborhoods have been designed to reflect Amazonian, European and bohemian styles. It offers a decent range of affordable properties for rent.

The city of Cuzco is home to just 350,000 people, but each year about two million tourists arrive for a holiday. Housing here is much cheaper than in Lima.

Outside the cities, the quieter pace of life may be attractive to those who are retired or looking for a different way to live, but employment and leisure activities will be fairly absent. In the rural areas, many of local people live with possessions and services that Westerners would class as very basic.

If you want city living but with increased security, residential complexes may be the answer. These can be found in suburban neighborhoods. However, in Lima, the traffic is horrendous and the public transport relies on an incoherent private system of overcrowded minibuses. If you’re set on moving to the capital, high rise blocks in central Lima may provide an alternative.

Rented accommodation is typically offered unfurnished. You will need to pay all the utility costs, purchase kitchen appliances and provide your own furniture. You may decide it is worthwhile paying the additional rent to have the furniture and fittings provided.

Estate agents in Peru offer properties for rent as well as sale. You may find estate agents are slow getting back to you if you email. As with business in Peru, you are best appearing in person to make things happen. A knowledgeable estate agent will explain the local rental market and the pitfalls to avoid. If you can’t speak Spanish, find an English speaking estate agent or take along someone to translate for you.

Properties are advertised on Craigslist, Immobilaria and Compra-venta, but you may find the personal services of an estate agent is useful in an unfamiliar country.

Unfortunately, you cannot rely on estate agents to find you suitable accommodation without you inspecting it first. The pictures may not be of the actual property, they may not be taken of areas which require maintenance or have problems, and they cannot give you a clear idea of the local area. You need to check these things for yourself before you sign a contract committing your money to a lease.

Always sign a rental contract before you move in, and always insist on signing a new one if the lease is to be renewed. You only have legal protection if you can provide the courts with a contract which both parties have signed, and at the end of the term the written lease expires even if you verbally agree to renew. The contract needs to set out:

• What rent you will pay, and when
• What other costs are to be charged, and when
• What the deposit is, and when it will be returned
• What fixtures and fittings are included in the property
• What notice the landlord must give you to evict you
• What notice you should give if you need to move

On the day you move in, walk around the property and take clear photographs of each room. Carefully note and photograph any damage or problems which could give rise to an issue at the end of your tenancy. When you move out, repeat this process. The landlord is allowed to charge you if they have to repair damage caused while you were a tenant.

Never deal in cash. Do not pay the estate agent or landlord in cash for the security deposit, first month of rent or any subsequent rent. In the event of any dispute, you must give the courts evidence of your payments, and this is best done with bank statements. Post-dated rent checks will sometimes be asked for when the contract is signed; keep detailed information about them in case they need to be cancelled later.

If you rent a property under a fixed lease, it may run for up to ten years. This is reduced to six years if the owner is disabled or if the property is owned by the state.

Indefinite leases run until the tenant or landlord gives notice. This is normally one month, but the contract may state differently.

If you don’t have a good grasp of Spanish, get someone you trust to check the contract and explain each term to you. Once you have signed a contract, it confirms you agree to all the terms and conditions. You cannot later claim something was unfair because you didn’t understand what you signed.

Landlords are legally required to pay for any necessary and useful improvements they make during a lease. However, this must be agreed with the landlord before it is enforceable, and again it must be stressed that the agreement should be obtained in writing.

A landlord will expect you to vacate the property at the end of the written contract term unless you renew the contract. However, if you fail to pay the rent or violate one of the other conditions of the contract, such as sub-leasing or using the property for criminal means, the landlord can apply to the courts for your eviction. There have been recent changes to Peruvian law which means landlords can evict tenants in a shorter timescale.

Read more about this country

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