Argentina's government has begun channeling money from the national pension fund into new mortgage lending for first-time homebuyers, launching a series of bank auctions on September 7 meant to unlock an estimated 17,000 to 18,000 loans for young couples.
The program routes up to 2 trillion pesos (approx. US $1.3 billion at this week's wholesale rate) from ANSES's Sustainability Guarantee Fund -- the reserve fund built from Argentina's now-defunct private pension system -- through successive auctions of 200 billion pesos (approx. US $132 million) each, with the Central Bank acting as technical operator. Banks bid competitively for the funds, with no single institution allowed to take more than 20% of any one auction, then have 90 days to convert what they receive into actual mortgages, against a December 1 deadline.
The loans carry a maximum rate of UVA plus 7.5% annually, tied to Argentina's inflation-indexed unit of account, with the funds deposited by banks earning UVA plus 2.5% on one-year terms or UVA plus 4.5% on five-year terms. Individual mortgages are capped at 150,000 UVA, roughly $200,000, with a minimum 15-year repayment term, and the loans can only be used to buy a first home.
Officials estimate the program is aimed at households earning around 3.46 million pesos a month (approx. US $2,290) who could afford monthly payments of roughly 865,000 pesos (approx. US $570) -- an income band meant to capture young, dual-income couples priced out of Argentina's mortgage market in recent years.
Access to formal mortgage credit has been scarce in Argentina for much of the past decade, with high inflation and interest-rate volatility making long-term, peso-denominated home loans largely unworkable outside UVA-indexed products introduced in 2016. This program is the government's latest attempt to use state-linked capital -- in this case, pension reserves rather than direct budget spending -- to restart that market.