Sick of Aussie house prices? Nab a bargain on Frontier’s South American property sites
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Australian property investors priced out of the overheated local market may find the real estate business in Uruguay, Paraguay or even Bolivia more to their liking.
ASX-listed Frontier Digital Ventures — which invests in online classifieds businesses in under-developed countries — has bought into Infocasas, said to be the leading property portal in Uruguay and Paraguay and number two in Bolivia.
Frontier bought 31 per cent of Infocasas for $US952,000 ($1.2 million) cash and has an option to move to 51 per cent.
Uruguay has one of the highest per capita incomes in Latin America, with 60 per cent of its population described as Middle Class by the World Bank. Paraguay and Bolivia are more challenged when it comes to poverty and income equality.
Still, Aussie investors sick of overheated local house prices can pick up a bargain on the Infocasas website.
Infocasas shows properties — such as the one pictured below — priced from as low as $US10,000 ($12,500) in the Uruguayan capital of Montevideo.
Infocasas was “a highly targeted, strategic expansion into the South American online classifieds market”, Frontier told shareholders.
“These markets have a combined population of 21 million, an average GDP growth rate of 3.3 per cent (World Bank, 2016) and mobile penetration rate of 119 per cent in 2015.”
Infocasas reported $US428,000 in revenue for the first half — up from $US275,000 in the same period last year, Frontier said.
Infocasas has 65,000 listings and more than 500,000 online sessions a month.
Frontier reported a $6 million loss for the half-year on revenue of $4.4 million. The business had $9.2 million in the bank at the end of June.
Its shares were steady at 73.5c on Thursday afternoon, giving it a market cap of $162 million.
The company has been contacted for comment.