Residential real estate in Italy: an overview of the development of the sector
The first half of the year was quite successful for the Italian real estate market. Despite the global processes, it showed a positive trend. Excellent results showed residential real estate in Italy, where the volume of investment amounted to 470 million euros. By comparison, during the first 6 months of 2021, this figure was 200 million euros.
According to analysts from JLL, the housing market in Italy is becoming more attractive to investors. They consider it a stable and reliable option for long-term income. For the first half of the year, the segment concluded with 181,767 transactions, which is 12% more than previous rates. An important factor in the development of the market is domestic demand. The pandemic has changed the behavior and needs of people, they now prefer spacious housing, and private homes. In addition, innovations from the government also contribute to the development of the segment. For example, in Italy, there are tax incentives for home renovation, and interest rates are still low.
As for the cost of properties, they increased by 2.6% over last year, but compared to the last quarter of 2021, rates have increased by 1.9%. The increase in demand has led to a reduction in the time that properties have been on the market. Last year it took an average of 6.2 months to sell a home, and now it’s 5.8 months. These dynamics indicate an increase in the liquidity of the sector.
During negotiations with the buyer, sellers are ready to negotiate a discount of 8.5% of the original amount. In 2021 this figure was at 9.7%. This situation indicates that there is a high demand on the market, so sellers do not need to make serious concessions to keep buyers.
The largest number of transactions in the first half of the year was recorded in the northern part of the country, the region accounting for more than 50% of the concluded contracts. 15% of this figure is concentrated in the eight most populated Italian cities, including Milan and Rome. The country’s capital is the leader in the number of transactions for the purchase of housing, but Milan shows the best growth in the market.
The main trend for the residential sector in Italy is considered to be the buyers’ need for spacious houses. At the same time, people do not want to overpay and focus on affordable options. After the pandemic, the need to improve housing conditions has increased, including by expanding the size of houses and apartments. People are paying attention to houses with their own grounds and open terraces.
To be able to work remotely, buyers are looking for options with extra rooms or rooms that can be converted into an office. In addition, they are interested in the availability of quality Internet.