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EXPLAINED: What will happen with property prices in Italy in 2024?

The number of properties sold in Italy fell last year, while house prices rose - but will this trend continue into 2024?

Published: 8 January 2024 17:14 CET
EXPLAINED: What will happen with property prices in Italy in 2024?
A woman walks past colorful houses in Burano. (Photo by GABRIEL BOUYS / AFP)

Buying a house in Italy is a goal that many who live both in Italy or abroad hope to achieve in the future.

However, there are a few things you should know about predictions for the Italian property market for this year before deciding to take the plunge. 

It’s no secret to those who live in Italy that Italian property prices have been on the rise since 2020. The most up-to-date figure for the third quarter of 2023 (according to Italy’s House Price Index) saw a two percent growth compared to the second quarter of the same year.

The increase, according to the National Institute of Statistics (ISTAT), was largely due to the rising prices for new builds in the country.

READ ALSO: What to expect from Italy’s property market in 2024

Because of soaring inflation and a growth in mortgage interest rates, the number of sales closed in Italy slowed down significantly last year. This year, experts predict the same will happen again; the number of sales are set to go down, whilst property prices are set to go up.

There are two valid reasons for this: the number of mortgages granted and the boost in rentals post-pandemic. 

To explain in more depth, the number of mortgages granted in the first half of 2023 dwindled by 30 percent compared to the same period of the year prior, according to data from Italy’s Consiglio Nazionale del Notariato (National Council of Notaries).

It is not yet known what will be in store for mortgages in 2024, but the cost of borrowing largely depends on levels of inflation across Europe and Europe’s Central Bank’s monetary decisions.

What’s more, according to the Real Estate Market Observatory by Nomisma, growth in the residential rental market (as opposed to buying and selling) was largely driven by student rentals after the pandemic and continues to be. 

READ ALSO: Five clever ways to find a cheap home in Italy

Nomisma predicts 2024 will more than likely see a continuation of negative sales trends, with a total of 643,000 total house sales predicted to close this year compared to the 670,000 in 2023.

They also predict property prices will rise slightly by 0.2 percent nationally, which is a decrease on the growth of the last two quarters.

If you take the slight increase in prices city by city however, those of you looking to buy in Florence or Naples might be in for a shock; property prices there are indicated to increase by 17 percent, with Catania and Verona following suit at six percent and four percent respectively. 

In Milan the price tag for properties is set to increase in the city’s outskirts, and more specifically the Ponte Lambro-Santa Giulia area where housing prices will see a growth of 7.8 percent. The same cannot be said for the country’s capital; prices show limited increase at just 1.1 percent. Rather, it’s the price of rent that has skyrocketed in the Eternal City.

Antonio Intini, Chief Business Officer of Immobiliare.it said: “ It is true that price dynamics are slow to react and this is why the forecasts do not depict a 2024 of decreasing prices.

“It must be said that the rise in mortgage rates and the rise in inflation have reduced the intentions and purchasing capacity of Italians, shifting a portion of demand towards rentals, a market which could therefore see prices rise in response to an increase in interest.”

Nevertheless, it isn’t all doom and gloom for those of you who want to buy this year. An annual report by Scenari Immobiliari’s European Outlook 2024  shows a bit more optimism, largely due to a possible decrease in interest rates. 

With all this in mind, it seems that compared to 2023, 2024 sales are due to drop, whilst property prices Italy-wide are only slightly on the up.

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PROPERTY

Can you still buy Italy’s one-euro homes in 2024?

A lot has changed since Italy's 'one-euro' home offers first made international headlines, so are they still available - or worth considering?

Published: 14 May 2024 10:27 CEST
Can you still buy Italy’s one-euro homes in 2024?

The prospect of buying a house in Italy for less than the price of a caffè normale at the local bar caused a sensation back in 2019, when news of one-euro home schemes hit the international headlines.

There was a property stampede in Sicilian towns in particular, with local mayors reporting being overwhelmed with enquiries in English and other languages.

MAP: Where in Italy can you buy homes for one euro?

Even sceptics couldn’t contain their curiosity: Was it a joke? What condition were these houses in? And how much was this really going to cost?

Several years later, we know that these schemes are legitimate attempts to breathe new life into depopulated areas and unburden local authorities of old, unwanted properties that would otherwise be left to fall apart. And in some cases, at least, it has worked – and proved very lucrative for the towns involved.

We know most of these houses are in a very poor state of repair, requiring major investments from their new owners. And we know the costs can be high, with reports of some international buyers spending hundreds of thousands of euros on renovations – many times more than the property’s potential market value.

READ ALSO: Six things to know about Italy’s one-euro homes

But we’ve also heard from some readers who tell us that, while these homes do of course cost more than one euro, for a sensible buyer they can be a worthwhile investment.

Not only are Italy’s one-euro home offers still going strong in 2024, but new towns are joining the scheme, while others continue to announce similar ‘cheap home’ projects such as the rental programme in Ollolai, Sardinia aimed at remote workers – one scheme that’s expected to take off following the introduction of Italy’s new digital nomad visa in 2024.

So what do you need to know if you’re curious about these Italian property bargains?

As ever, if you’re interested in buying a one-euro home you’ll need to meet certain requirements which vary depending on the local authority. After all, this is not a nationwide scheme but a series of small initiatives run by local councils in each town or village, so you’ll need to carefully check the terms and conditions of every offer you consider.

Generally though, the following will apply:

  • Foreign nationals can buy one-euro houses, whether they’re EU or non-EU citizens – but remember owning one will not give you any residency rights in Italy, and visa rules will still apply to non-EU nationals.
  • The prospective buyer can’t just make vague promises about doing the place up: you’ll need to present a renovation plan within 2, 3 or 6 months depending on the village.
  • Buying a one-euro home to turn into a tourist rental business is generally allowed, but you’ll need to let the local authority know your plans when you apply.
  • The cost of the house, all renovation costs, and all notary, legal, transfer and other fees are the responsibility of the buyer.

Some things have however changed in the past few years which make buying and renovating a one-euro home less affordable than it once was.

Many buyers in recent years were further tempted by generous state subsidies available to cover the cost of renovation work – most famously the ‘superbonus 110’ which covered up to 110 per cent of qualifying expenditures.

READ ALSO: What taxes do you need to pay if you own a second home in Italy?

Though the superbonus is now winding down and is no longer open to new applications, it has had a knock-on effect which means renovations in Italy generally take longer and cost more than they used to.

The superbonus scheme’s enormous popularity led to an ongoing shortage of building contractors in Italy, who were booked up months, or even years, in advance.

And as the popularity of these offers has exploded, the most viable properties in some areas now often become the subject of a bidding war, with the sale price rising from one euro to tens of thousands.

Find a map of the towns currently offering one-euro homes in Italy here.

Have you bought a property through a one-euro home scheme in Italy? We’d love to hear from you. Please get in touch by email or in the comments section below to let us know about your experience.

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