An overlook of prices an purchases in Italy, where investing is increasing everywhere
The price trend
Spring is coming also for the real estate market. For the first time in years, looking at the price trend in the eight major Italian cities, we see several «plus» signs. They are still the minority and the average change in value is only slightly above or just below zero, except for Milan, which is experiencing a stronger growth. The signal is unequivocal but not surprising because last year, to inaugurate L’Economia del Corriere, we compared the change in purchase requests in the main areas of larger cities, recording a significant and generalized growth, prelude to a resumption of transactions and also of prices.
As for sales, official figures for 2017 released by the Revenue Agency say that in Italy 542,480 homes have changed ownership, an increase of 4.9% over the previous year.
Milan, Bocconi and the Navigli area win
It is no wonder that the greatest number of “plus” signs are recorded in Milan. The Lombard capital, as has always been the case since the post-war period, anticipates market trends. In 2017 sales in the city increased by 8.1% (the highest value among the big cities); and in 2017 average prices increased by 2.5%. The area that recorded the greatest increase over the three-year period is the one between Bocconi and Navigli with a 20% climb, just as significant is the increase in the ramparts between Porta Romana and Porta Venezia (Via Montenero + 21.1%, Viale Piave + 15.3%), but also peripheral districts served by the subway are emerging, thanks to very low prices, such as Baggio or Comasina.
On the other hand, prices in the historic center are essentially stable.There however, the values during the crisis fell much less than in the rest of the city. The values in the area of Repubblica-Garibaldi are also increasing, but a homogeneous comparison with three years ago is not possible because then Porta Nuova was nearing completion.
Rome below average, good Testaccio and Ponte Milvio
The Rome market is not as good, serving a low quality offer. Sales in 2017 have increased but less than the national average, and even the growing neighbourhoods are few. The best performance was recorded in Parioli, which grew by 4.1% in the three-year period and among the areas with the positive sign, the residential areas prevail (Testaccio, Via Merulana, San Giovanni in Laterano, Ponte Milvio)
Naples, the suburbs of Bagnoli and Pianura are better
In Naples, the significant increase in sales (+ 7.4%) is in the suburbs with the lowest prices; the greatest increases are in fact recorded in Bagnoli and Pianura. It should be noted that Tecnocasa data indicate a real price collapse in Mergellina, in the order of 30%.
Florence, the boom under the Duomo …
The growth of the Historic Center of Florence is even more striking. Prices have risen up to 25.8% between the Duomo and Santa Croce, while in the close Via Gioberti there is an increase of 14.3%.
Those who buy a house in Florence between the Duomo of San Giovanni or Ponte Vecchio today almost never do so because they are in love with the artistic charm of the historic center of Florence; the driving force is instead the love of money that can be earned by renting accommodations to tourists.
18.5% of sales are those who want to invest
On the other hand, it should also be noted that the diffusion of short-term tourist rents, driven by the spread of web platforms such as Airbnb, makes real estate investment in homes less risky, because payment is made in advance and guarantees profitability on an annual basis net in line with that of traditional leases if the property is well located.
The numbers of the Madonnina
Beginning the tour of the main cities with Milan, in the last four years the share of investments in the Lombard capital has increased from 18.2% to 29.3%. The highest shares are recorded in the Center (48.4%) and in the areas of Lodi-Corsica (36.0%), Central Station-Melchiorre Gioia (34.7%), Navigli (34.0%). Both the center and the area between the two major railway stations (Centrale and Garibaldi) are driven by the possibility of making short-term rentals easily and by the presence of the business district of Porta Nuova.
In the macro-areas of Lodi-Corsica and Navigli-Famagosta, the proximity of important universities play an important role. Same thing for the Lodi area, where there are expectations linked to the birth of the «Symbiosis» business center and the recovery of the dismissed railway station of Romana Scalo.
© L’economia del Corriere del Sera
4.2.19
by Gino Pagliuca