Strong Demand for Prestige Italian Properties

Prices for premium second homes in Italy continue to rise, although at a slower pace. The news comes from a new study into the second home market by Italian estate agents association FIMAA.
“Demand for prestige properties has further strengthened compared to 2007, partly thanks to the growing number of foreign buyers,” says FIMAA President Bruno Paludet. “The rest of the market, by contrast, appears to be extremely choosy in the middle range and extremely price-sensitive at the lower end.”
When taken as a whole, the market is not quite keeping up with the inflation rate forecast for 2008 (which is now in the region of 3.5%, after the recent spike in July). Supply has been good in the last twelve months, while demand has somewhat decreased compared to 2007. As a result, nominal prices have increased by an average of 2.5% for mountain resorts and 2.2% for seaside ones (against 4.5% and 5.4% respectively in 2007).
But the top end is performing much better. The biggest price growth, says Fabrizio Savorani, who heads FIMAA’s Tourist Market department, come from “the best resale properties, either situated in panoramic spots or by the sea, with easy access to beach, marina or ski slopes; and from new builds, especially bright and airy ones with large outdoor areas—not necessarily very big but, if small, functional and rational in layout.” In this cases, average increases have been in the region of 3.9% for mountain homes and 3.4% for seaside ones.
Of course, location makes a huge difference. Prestigious, fashionable and sought-after resorts have seen rises of 4% or above, as are locations where access has improved significantly or where infrastructure or development projects are giving new impulse to demand.
Among the former, Milano Marittima and Marina di Ravenna, two trendy resorts in the Romagna riviera, have seen spikes of 6.8% and 5.3% respectively, while, in the mountains, exclusive Cortina d’Ampezzo registered a 4.6% growth.
Among the latter, Soverato, a pretty town lapped by a turquoise sea in Calabria, has seen prices go up by 4.6%, partly thanks to the new national and international interest in Calabria. Places like Sardinia’s lovely Villasimius, which has a new motorway link to the international airport in Cagliari, but also cheap and cheerful Rimini, where plans are afoot for a renovation and improvement of the seafront, have experienced rises in the region of 4.3%-4.5%.
Although smaller in scale than in the past, the latest increases have ensured that there are now nine resorts where average prices for premium new-build properties are above €10,000 per square metre—Cortina d’Ampezzo, Porto Cervo, Santa Margherita Ligure, Forte dei Marmi, Capri, Madonna di Campiglio, Alassio, Porto Rotondo and Positano—against seven in 2007 and five in 2006 (the FIMAA report does not include Portofino. Of these, only two—Madonna di Campiglio and the super-expensive Cortina, where prices reach €16,521 per square metre—are mountain resorts. That said, on average, prices for mountain homes grew more than those for seaside ones. It is the first time this happens in the last three years.
At regional level, the most lively areas are Calabria and Molise for seaside properties (with average rises of 3.8% and 3.7% respectively) and Veneto for mountain properties (up 4.3%).
Looking ahead, FIMAA agents forecast stable sale volumes with slightly decreasing prices for seaside resorts and a decrease in both volumes and prices for mountain ones.