Uruguay’s Real Estate Market: A Growing Opportunity

In recent years, Uruguay’s real estate market has experienced significant growth driven by various factors, notably the promotion and encouragement of investments in this sector. These initiatives have provided substantial benefits not only to local and foreign investors but also to end-users seeking housing solutions.

Uruguay offers a unique legal framework through the Promoted Housing Law (Law 18.795), aimed at fostering private investment in residential construction while simultaneously facilitating broader access to housing for the population through considerable tax incentives.

Although the law has been in force since 2011, it was during the administration of President Luis Lacalle Pou that certain aspects of the legislation were further relaxed. These adjustments have led to a notable surge in investment and construction activities under the law’s benefits.

The law grants tax exemptions on income generated from promoted investments, benefiting not only investors but also final users, as it also exempts property transfer taxes. Additionally, special advantages are provided for those acquiring properties through bank financing.

As a result of these recent regulatory relaxations, it has become increasingly common to walk through the streets of Uruguay’s main cities and witness numerous construction projects, with many new buildings ready for occupancy. The rapid investment growth has not only expanded housing options for prospective buyers but has also contributed significantly to the development of previously underpopulated areas.

This expansion has alleviated congestion in the capital city by populating nearby zones and creating new “localities” equipped with essential services such as shopping centers, schools, medical facilities, and dining establishments. These developments effectively meet the needs arising from the growing population in these thriving regions.