Italy real estate optimism at 2-year peak
The second half of 2009 saw Italy real estate agents at their most optimistic since 2007, new figures suggest. This new, upbeat mood stems from growing confidence among prospective property purchasers as evinced by the gradual ebbing away of anxieties about the economic crisis that in previous months have seen many put buying decisions on hold.
Since Summer 2009 there has been an increase in housing demand, proof that new-found optimism is slowly translating into increased searches for properties. This renewed confidence among purchasers has also been in part prompted by price realignments observed in recent years. There has been growing recognition among sellers that artificially inflating values above their properties' intrinsic worth risks leaving them unsold for months or even years.
In addition, there has been continued growth in the demand for property - in beauty spots such as Cortona and Lucca - as an investment, a trend that could be accelerated by the provision of fiscal tax shelters. As has traditionally been the case, Italian home loan providers continue to demonstrate characteristic prudence both in terms of number of approved mortgages, the length of time before an approval decision is given and the amount lent.
On the flip side, it is an approach that has avoided saddling Italian personal and business borrowers with unmanageably high debt, meaning the country has avoided the vertiginous booms and busts that have hit other property markets. Those finding it hardest to acquire home loans have been single-income families, immigrants and workers on short-term employment contracts.
The most current of the data, compiled by real estate conglomerate Tecnocasa, suggests an average of just over 22 weeks to complete purchases. It also points to prices in Italy's largest cities bearing up best. They saw a 1.5% decline in the second half of 2009, a slight improvement on the fall witnessed in the preceding six months. Milan and Rome were the best (or least worst-hit), recording almost negligible declines in the second half of 2009 of 0.8% and 0.4% respectively.
To break the statistics down even further, the centres of largest cities are where prices have been least affected, with the outskirts bearing the brunt of the steepest prices declines. Worst hit were the suburbs of Palermo in Sicily (-3.3%); Rome; and Bari in Puglia (both -3.1%)
In terms of provincial capitals, those in the North and South of Italy were worst affected, with average declines of 2.3% in both extremities of the country. In comparison, provincial capitals in the centre of Italy reported a 1.7% decrease.