907 property prices in italy

From what I've seen (and this is a totally unscientific conclusion) the Brits are far too concerned over house prices and if the only reason for buying a property in Italy is to see the property's price increase, then that's the wrong reason for buying.

If you are expecting (or needing) a property to appreciate in price, then you are likely to fall on your face.

I think that this outlook derives from the UK's (obscene?) focus on house prices. Property prices in the UK are subject to greater fluctuation as:
- more people buy and sell (it seems to me that Italian properties stay 'within the family' rather than bought and sold)
- owning a property is 'a must' (Italians are not as hung up on renting from what I've seen)
- there's more intense focus on a price

Maybe, rather than helping you, I have just vent my spleen (sorry if I've misjudged your intention!).

According to a recent review by RICS, the housing market in Europe will experience further growth in 2005 as the demand for overseas properties continues to be fuelled by continued low interest rates and greater buying power due to the strengthening pound.

Italy has seen prices rise between 5% and 8% recently. However, you have to bear in mind that the market here is volatile and it is impossible to generalise about prices because sales are strongly influenced by many variables such as location, vicinity to local town/village, accessibility, local infrastructure and the natural environment for example.

Another important (often underestimated and overlooked) part of the process is that there is a tendency for prices in some regions to be overblown because vendors see continued interest from overseas buyers.

Your strategy appears to be typical of the scattergun approach adopted by many so overseas buyers looking for cheap properties. You are really not doing yourself (or anyone else for that matter) any favours. This is a potential strategic trap because you are in effect weakening your own position and placing greater bargaining power in the hands of the vendor.

My advice to you is to consider the following:

Ask yourself what you really want, what you want to achieve and what you can realistically afford.

Don’t be fooled into thinking Italy is a land full of cheap properties. If you feel this way then you risk getting carried away by the dream of living abroad.

Be prepared to spend some time doing your homework. This means selecting the best region for you. It is no good selecting the mountains of Piemonte when all you crave for is sunshine and sandy beaches or vice versa. Take time to visit your chosen region during different seasons and check out the local infrastructure.

This is just part of a number of things you should be thinking about. It really comes down to common sense.

[QUOTE=red tulip]i am considering buying in italy.as most of you know,property prices are falling in the u.k and other recent economic figures are not brilliant.what i want to know is -are there fewer english buyers around now as a result of this?or maybe prices are rising.the areas i am particularly interested in are northern tuscany,piemonte and puglia.thankyou.[/QUOTE]

Economic figures in the UK are not brilliant, but they are far better than those of Italy. If you are buying a house as an investment then buy in Sarajevo or Skopje etc and forget about Italy.

I don't believe there are fewer British buyers now because of the slight downturn in the UK property market, if anything Brits (certainly SE English) are desperately trying to sell up so they can get as much cash out of their property now before the prices really start to go down. Therefore they will all soon be on their way to Italy etc to 'live the dream'.
East European property opportunities in countries such as Bulgaria are taking away some of the people who would previously have considered Italian property, and this trend looks like it will continue taking many Germans etc away and therefore preventing expat type property prices from rising as fast as previously was the case.

House prices in Italy for the types of houses typically purchased by expats continue to rise steadily in some Italian regions (Umbria, Tuscany etc) and more vigorously in others (Puglia, Sicily etc) although looking at all properties bought and sold in Italy things are a lot more static and not looking so rosy for the investor.

thankyou for your replies.i am not looking at this from an investment viewpoint.if i see a house i like then if it is worth the asking price to me i will pay it regardless of whether it seems a bargain or not.i have heard that there has been a recent downturn in british people buying in spain and this has been attributed ,in part,to prospective buyers worrying about recent economic data.i am just interested in knowing if the italian market has been affected in the same way

There does not seem to be a downturn in prospective buyers in the Marche, I cannot speak about the areas you specifically named, but doubt it. :)

It seems that "buying for investment" (OK, not red tulip's aim) is fine but it's like any investment; prices can go up as well as down & in order to make it work, you need to keep an eye on the market & sell when the time is right!

Houses tend to be more emotional purchases than stocks and shares, but if you ARE buying for investment, then all emotion needs to be taken out of the process.

Unlike stocks & shares, however, house prices don't have a FTSE (or similar) index so there is have no reliable index. If you want to know the price of shares in Unilever, then it's a simple process of looking in the FT or on line. Whilst there are fluctuations, these are known and transparent. There is no simlar transparent source for house prices, apart from estate agent windows & I doubt that this process is not as reliable as some might like to think!

House prices have increased a lot in Italy in the last years because the request of houses is increased.
This happened for many reasons:

- the euro dropped interests on loans, so many young couples prefer to purchase with a long term loan (20/30 years) insead of renting an house

- thanks to low interests many big investors shifted their investments from stock exchange to real estates

- all the scandals, dafaults and big losses that happened in the shares market (Parmalat, Argentina, Cirio) pushed people to more solid investments (ie houses)

So the rise of prices has partially concrete reasons and partially speculative reasons.
Like everything in economy, prices cannot always rise: it only has to go up interests and the speculation will became less profitable.
But you still have to considering the fact that in the past house prices have stopped rising, but sedom dropped

If you can find yourself any house in any area in Italy that you like with a good sized parcel of agricultural quality land (say 10 acres+) it is likely to be a great investment in the medium to long term - particularly if you enjoy the time you spend in the house.
If you don't have the land you cannot be so sure of your investment as buyers in the Spanish costas are now finding out as thousands upon thousands of identical appartments are thrown up diluting existing expat's residents investment.

The Sunday Times Homes section this week described in some detail how the adventurous expats arriving in Tuscany in the 70's are now starting to sell up and leave with their original £3-10,000 investments now valued at £1 million+!

Red Tulip,
I agree with most of the previous messages. We deal with properties in piemonte, and the price range in very wide.
I have to say that the market in Italy is a bit more stable thatn here, just because of our way in thing, we are sort of slower!
The prices have incread quite considerably after the arrival of the Euro, but i do not forsee a drop in the house market over there.
Good luck with your research, i hope you will come to Piemonte!

Paola

[QUOTE=notaio]
- the euro dropped interests on loans, so many young couples prefer to purchase with a long term loan (20/30 years) insead of renting an house

- thanks to low interests many big investors shifted their investments from stock exchange to real estates [/QUOTE]

Just out of curiousity, what are the current interest rates on loans in Italy notaio?

[FONT="Book Antiqua"][SIZE="3"]Surely it depends on the type of property you buy and what you do to it?Those places in Tuscany that now sell for millions were old country houses with land in a beautiful landscape bought for a few thousand!

We have bought an old but very run-down house in a beautiful and secluded place with a garden and as the agent says ..potential.If possible when its has been restored by us and the garden is sorted out I hope in the long term the value will have risen.we'll see.

becky[/SIZE][/FONT]

Thanks Becky, I'm sure there is something to what you say.

I'm just curious what the range of rates are on the average home loan in Italy.

Let's say a 30 year mortgage loan has what percentage of an interest rate in Italy? What might be the going price range (I understand it can be somewhat variable) for that kind of a loan?

[QUOTE=greatscott]Thanks Becky, I'm sure there is something to what you say.

I'm just curious what the range of rates are on the average home loan in Italy.

Let's say a 30 year mortgage loan has what percentage of an interest rate in Italy? What might be the going price range (I understand it can be somewhat variable) for that kind of a loan?[/QUOTE]

do they do 30 year mortgages in italy?

[QUOTE=giovanni]do they do 30 year mortgages in italy?[/QUOTE]

they may do nowadays but typically you'd be looking at 5- 15 years, credit is not such an available commodity as in some countries.Usually for mortages you will be expected to provide proof of income or of available means,the property may be valued by the bank but if it's still to restore will have a value attributed by the bank far less ,probably, than what you even paid for it.
the current mortage interest rate to expect would be 6%-6.5%

[QUOTE=Sebastiano]they may do nowadays but typically you'd be looking at 5- 15 years, credit is not such an available commodity as in some countries.Usually for mortages you will be expected to provide proof of income or of available means,the property may be valued by the bank but if it's still to restore will have a value attributed by the bank far less ,probably, than what you even paid for it.
the current mortage interest rate to expect would be 6%-6.5%[/QUOTE]

That's if your talking about a fixed rate. 15-year variable rate mortgages can be obtained at Euribor + 1.20% (very good - Unicredit FIAIP rates) or + 1.5% (normal - most banks). That works out at 3.7-4%.

30-year mortgages are available but only for young couples in permanent subordinate employment buying first homes.

Giangiacomo

One thing to consider is that the houses many Brits buy in Italy wouldn't be touched with a bargepole by most Italians (that's why there are so many cheap 'bargains' to be had).

Property prices in the 'Italian' market eg Rome have risen considerably in the last few years but the main thing driving rural ruin prices is the foreign demand - problem is there is an awful lot of supply, particularly in southern Italy.

As long as there are foreigners with money and without access (language bariers etc) to the 'local' market the market will probably hold up but it could be quite fragile.

As an example, a few years ago I looked at a property in Abruzzo owned by a foreigner ands advertised on the web. the price asked was 100 000. I quickly established that the local value was about 50 000, so I offered this. I was told that the price was for the 'inernational' market so I walked awayand staggeringly it was sold, fairly quickly, for 100 000 to a brit. When it comes to sell if there are more gullible foreigners, no problem, if not a big loss....

All the agents I went out viewing with in December in southern Tuscany reported exactly the same scenario, few properties being sold as most sellers were still demanding what even agents acknowledged were unrealistic asking prices. One agent said the only places she had sold in recent months were where "vendors finally saw sense", ie reduced their asking prices or accepted offers. Another was defensive to the point of embarrassment assuring us quite unnecessarily that she had sold "some" properties since the summer. Of course, even in good times, places hang around far longer than they do in the UK but, even so, it was readily obvious that things were slow. And no one we spoke to expected things to change all that quickly.

May I add to this and welcome your thoughts, I think that there will for many years be a surplus of rural properties available in Italy as the younger generation no longer want to holiday at the family home in the country, and seek their thrills outside Italy, therefore as their parents pass the old family home is sold.
This is just my experience of what i've seen.
Regards

Gary

Welcome to the forum Violetta :)

Thanks so much for an interesting first post. There are some postings from forum members who have bought for substantially less than the asking price based on their own research of what the homes actually sold for ( upon talking to others, or formulas that have been discussed) in their areas of interest.

We hope for your success in the future,

Dee and John

Dee & John,
Your message encourages me as I'm off to Italy on Wednesday to make an offer - quite a bit below the asking price - on a property we're very interested in. We can pay the asking price - and possibly will if we have to ti secure it - but it is currently overpriced so I'm going to give it my best shot. Wish me luck!
V

You have our best wishes for a happy outcome Violetta! :)

I'd love nothing better than to read a post, upon your return, that your offer has been accepted! All fingers and toes crossed that you're going to get the home you adore for a fair price!

Dee (and John too ;) )

one of the areas i have been looking at is puglia.over the past nine months the asking price for complete renovation projects ie:a pile of stones in a field ,has risen a lot.however,i have also noticed that many of these properties,unless they are in a great location or have another unique selling point, are still for sale months later and sometimes the price goes up.if there is a property at a reasonable price it sells very quickly.agents have told me that the vendor has a price in mind and will wait to get that price unless he really needs the money.i suppose the prices will remain high until we as buyers lose interest en masse, and force a rethink.as long as somebody hears of their neighbour selling at a very high price they will want to achieve that price-and it would be the same anywhere in the world.

[QUOTE=red tulip]thankyou for your replies.i am not looking at this from an investment viewpoint.if i see a house i like then if it is worth the asking price to me i will pay it regardless of whether it seems a bargain or not.i have heard that there has been a recent downturn in british people buying in spain and this has been attributed ,in part,to prospective buyers worrying about recent economic data.i am just interested in knowing if the italian market has been affected in the same way[/QUOTE]

This is the right way to think. Real estate in Italy is far from the fluctuations you have for ex. in USA. When prices stop to increase, then the get stable, but historically never went down. Naturally I talk from quality houses and positions. So I think you should chose well your Home. Perhaps take it smaller but high quality (position and quality...for ex. old stone houses).
For Tuscany you can take a look to this web page in case: [url]www.bramasole.co.uk[/url]
good luck!

[QUOTE=red tulip]one of the areas i have been looking at is puglia.over the past nine months the asking price for complete renovation projects ie:a pile of stones in a field ,has risen a lot.however,i have also noticed that many of these properties,unless they are in a great location or have another unique selling point, are still for sale months later and sometimes the price goes up.if there is a property at a reasonable price it sells very quickly.agents have told me that the vendor has a price in mind and will wait to get that price unless he really needs the money.i suppose the prices will remain high until we as buyers lose interest en masse, and force a rethink.as long as somebody hears of their neighbour selling at a very high price they will want to achieve that price-and it would be the same anywhere in the world.[/QUOTE]

I think one of the reasons that the price of a pile of stones in Puglia has risen so much is that a lot of these are owned by contadini who are just cottoning on to the fact that they can make a fortune selling them (and good luck to them!). Maybe because things traditionally take a long time to sell in these parts, they are more than happy to sit tight and wait for the money to arrive - people are just not used to doing things quickly round here. Incidentally, prices have also risen steeply for trullos that have already been restored as we have recently found out when asking agents to value our trullo for us. In fact, one agent even offered to buy our trullo themselves (but obviously at a slightly reduced price!) as they know that they`ll soon be able to re-sell at a profit.:rolleyes: