This 99-acre property with a 13,000-square-foot house and 67 acres of vineyards is in the Casablanca Valley, about a 45-minute drive from Santiago, the capital of Chile. The estate is on a country road about five miles off Route 68, the main highway linking Santiago to the coastal cities of Viña del Mar and Valparaiso.
The current owner of this estate is growing primarily sauvignon blanc, with smaller plots for pinot noir and merlot.
The one-story, U-shaped colonial house, with seven bedrooms and five and a half baths, was built in 2009. The living room, dining room and kitchen are in the center of the house; the bedrooms are in the wings. The double-height ceilings are made from bamboo, in a traditional style, supported by hardwood beams. There is terra-cotta tile flooring throughout the house. The walls are reinforced concrete.
The long, rectangular dining room is large enough for a 10-chair table. The kitchen is described as “country-style,” with silestone countertops and space for a dining table. There is a 300-square-foot wine cellar, in addition to a laundry area, a maid’s room and a large office. The furniture is not included in the price, but is available for sale, according to Matt Ridgway, the owner of Chile Investments, a consultancy marketing the property.
There are four bedrooms and three bathrooms in the north wing, and three bedrooms and two bathrooms in the south wing. There is also a half-bath off the living room. Two master bedrooms, one at the end of each wing, have en-suite bathrooms and walk-in closets, Mr. Ridgway said.
The property also includes a swimming pool and a tennis court. The backyard has a large lawn and a grove of olive trees. Two small homes are on the outskirts of the property for staff. The sale price includes subterranean water rights, which are essential for agricultural land, Mr. Ridgway said.
It is rare for this type of property to be offered for sale publicly, Mr. Ridgway said. “Properties within this market and price range typically don’t come onto the market, but change hands privately,” he said.
The town of Casablanca, population around 25,000, with shops and restaurants, is about a 15-minute drive from the property. There are also several excellent restaurants in the wineries in the area, Mr. Ridgway said. The Santiago International Airport is about 40 minutes away.
The Chilean economy has slowed in recent years, partly because of a steep drop in the price of copper, a key industry for Chile. After hitting a high in 2013, the gross domestic product has been declining since.
Demand has remained strong for high-end properties, but sales have slumped for mid- and lower-priced homes, agents said. This year the government also imposed stricter lending requirements, capping loans at 80 percent of the value of a home, which has dampened the domestic market, agents said.
“What we’re seeing now is a market trending toward more of a rental market than a sales market,” said Jorge Mira Olivos, the head of real estate at Engel & Völkers Chile, the property agency.
In 2016, rentals handled by the Engel & Völkers office have increased 30 percent from a year earlier, while the number of sales has dropped more than 5 percent, Mr. Olivos said.
Sales in Santiago are down as much as 30 percent to 40 percent, Mr. Ridgway said. “But there’s still demand for good, well-located properties,” he said.
Despite the recent slowdown, the market is “stable,” says Víctor Danús, general manager of ProUrbe Chile, a real estate company.
Over all in Santiago, the average price of an apartment is about $203 a square foot ($2,183 per square meter), and for a house it is about $152 a square foot ($1,637 per square meter), he said. But prices can rise to more than $300 a square foot for a house in more exclusive communities at the foot of the Andes, such as Vitacura or Lo Barnechea.
A new law imposing value-added tax on the sale of new properties has made older properties more attractive, he said. The new VAT, which went into effect on Jan. 1, can add from 4 percent to 11 percent to the price of a new property, he said.
Wine country properties are hard to value, Mr. Ridgway said. There are few large properties for sale, and few of the larger vineyards have homes comparable to this property, he said.
WHO BUYS IN AND AROUND SANTIAGO
In Santiago, foreign buyers are rare, agents said. But in wine country, where this house is, foreign buyers account for as much of 80 percent of sales, Mr. Danús said. Most of the foreign buyers come from Brazil, Argentina and the United States.
Wine country also attracts retirees, drawn by the mild climate, Chile’s diverse recreational activities and home prices that are lower than those in some other South American countries. The vineyard properties are often converted into boutique hotels or bed-and-breakfasts, agents said.
The weakening of the peso against the dollar has made Chilean real estate more affordable for United States citizens, Mr. Ridgway said. While the 10-year average is about 550 pesos to the dollar, the current rate is closer to 670 pesos, and earlier this year it reached 730 pesos to the dollar, a recent high.
Real estate prices are typically listed in Unidad de Fomento (UF), a form of currency tied to the Chilean peso, but adjusted for inflation to provide more consistent prices.
There are no restrictions on foreigners owning property, except in border areas. But it is almost impossible for a nonresident to obtain a mortgage; most foreigners buy in cash, agents said.
Over all, it is “a really simple process,” Mr. Olivos said. But agents recommend hiring a lawyer to track the process and ensure the property is free of debts or liens. Agents are also unregulated, making it important to find one with a proven track record, Mr. Danús said.
A notary handles the bulk of the transaction details. Once the seller and buyer agree on the price and title is confirmed, the full purchase price is held in the form of escrow until approved by the government property registration agency, the Conservador de Bienes Raices, Mr. Ridgway said.
Chilean tourism site: chile.travel
Government of Chile: gob.cl
Chilean Trade Commission site: www.prochile.gob.cl/int/united-states
LANGUAGES AND CURRENCIES
Spanish; Chilean peso ($1 = 670 pesos)
TAXES AND FEES
Closing costs for buyers usually total about 4 percent to 5 percent of the purchase price, Mr. Ridgway said. Those costs include 2 percent to 3 percent for agent fees, the notary’s fee and a registration fee of about $350 to $800.
Property tax on this property is less than $3,000 a year, Mr. Ridgway said.
(The New York Times)