With Italian Home Prices Still Sliding, Now Could Be The Time To Buy Your Dream Getaway
It’s all change in Europe. As the Italian slump slows, the UK decline increases and Germany and Scandinavia hit new highs.
Who doesn’t want to live the life of George Clooney and own an Italian mansion by a lake? Well, unless you, too, are banking A-lister Hollywood paychecks, owning something quite that opulent may be tough. However, continued slide of Italian real estate—down 5.5 percent in 2016, according to real estate consultancy Knight Frank—means that owning a slice of Italy may be within your reach.
House prices in Italy have been declining for over eight years, dropping 16 percent from the third quarter of 2008 to the third quarter of 2015, or a mighty 23 percent after inflation, using European Central Bank figures. The latest drop marks what Knight Frank feels must be the low point. However, not all Italian cities are equal in their race for the bottom. Fourteen percentage points separate the strongest and weakest performing areas.
Clooney’s glamorous neighborhood of Lake Cuomo, with its close proximity Milan and the Swiss border—just in case you need you buy an expensive watch to match your designer threads—was actually up 1.2 percent in 2016. The other major Italian cities—Rome, Milan, Florence and Venice—are in the top half of the rankings with slowing declines over the two years.
At the bottom was Forte dei Marma, located in Lucca province, on the northwestern coast within Tuscany. Prices there slipped 13 percent in the year to December.
Generally, with the exception of Clooney and few others, the majority of foreign buyers for Italian real estate have been from other European countries where the Euro is prevalent, reports Mansion Global.
“2016 proved a turbulent year, but that’s nothing unusual in Italian politics, and although both the domestic and global economy are facing their own respective headwinds,” said Knight Frank’s International Residential Researcher, Kate Everett-Allen. “We expect prices will stay largely static; we don’t see immediate rises or substantial declines on the horizon.”
If Italy has been been turbulent, other European cities have fared better in the wake of the Brexit fallout, seizing on the downbeat view of the UK. In particular, Germany. A new report from PwC and ULI sees Berlin, Hamburg and Frankfurt occupy the top three places for investment and development prospects. After a brutal crash in 2008, southern European cities Lisbon, Madrid and Barcelona are also fairing well.
The pessimism about the UK is also reflected in The Times’ recent survey of leading economists, which predicted that London house prices would either flat line or drop, by as much as ten percent in 2017. Knight Frank research found that house prices over $2 million in central London had already dropped as much as 13 percent in the last year.
The good news for British home owners is that they could always sell up and move to Italy and still have cash to spare.
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