In 2003, Argentina was still struggling to recover from a severe economic downturn, and from being South America's banker fell from grace in spectacular fashion. Overnight, following the devaluation of the Argentine peso, hotel owners lost their businesses, the international press was full of lawless scare stories, and it really did seem like the right time for tears in the land of Eva Peron and a bad time for property investment.

However, four years later, Buenos Aires, the capital of Argentina, is positively booming following back-to-back annual GDP growth of almost 10 per cent. Historic, with boulevards and a pronounced European feel entirely unusual for the region, Buenos Aires is now pulling in leading international architects and designers to complete its transformation – with Norman Foster and Philippe Starck leading the charge.

Of course, with names like this on board, hopes of a bargain basement property go out of the window – a very high window, whilst its rich-kid status in South America means cheap homes aren't a necessity for its well established middle classes. In fact, at El Aleph, a Foster-designed residential property development, prices for apartments start at £157,000, and don't stop until they go smashing through the one-million-pound ceiling.

Nonetheless, more modest property in less trendy areas of Buenos Aires is available for approximately £30,000, although a budget of £100,000 would give the prospective property investro much more scope to shop for property. For those looking to combine city and coastal pursuits, note that Buenos Aires is not really a beach destination. The capital's residents tend to head across the River Plate to Montevideo, the capital of neighbouring Uruguay, to hit the sandy stuff. But with everything from gaucho-galloped plains to ski resorts and glacial landscapes, Argentina is not short on variety.

As well-chosen property increased in value by as much as 25 per cent in 2006, Argentina is certainly worth the risk – but risk it most certainly is, with many properties bought in cash in an industry that isn't exactly covered in red tape. Still, if you can mimic the sure footsteps of a tango dancer, your bank manager could soon become passionate about South America's second-largest country.

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Article published 2 July 2007