Italian Property Market has Weathered the Storm Well, Poised for Growth into 2010
Posted On: 10/11/2009
The Italian property market has been highlighted for its continued stability especially during one of the world's worst recessions by one off the industry's leading experts. In a feature in The Times, Rupert Fawcett head of Knight Frank's Italian operations said:
"Historically, property prices in Italy have always held. Italy’s second-home market has been largely unaffected by the recession. Forced sellers are rare as most properties have been bought as a long-term purchase. Prices have fallen on average 10 to 20 per cent and now, similar to the UK, prices have started to curb."
It is far from surprising to hear such statements after a 1% growth in the Italian economy was revealed in the 3rd quarter results, following a massive 8% increase in output. The Italian economy was forecast to grow strongly because it is made up of many small and medium sized enterprises, rather than by a few big companies, as in most established markets.
These small businesses were able to adapt easier, quicker and -- in most cases -- more efficiently to the changed international business arena. This is evident it Italy's return to growth being among the strongest in Europe.
Italy's property market never collapsed because the banking sector never collapsed. Also, because foreign demand has mainly been from lifestyle buyers and long-term investors, which meant there was no massive -- speculation driven -- growth in prices, and no need for a severe correction.
Now, as it becomes apparent that the worst is behind us, demand for overseas property is growing in huge markets like the UK, Eastern Europe and Russia.
It is logical that Italy would be a favourite, a: because buyers are favouring established markets, b: because Italian prices have been shown to be stable and less vulnerable to external influences and c: because the Italian economy is recovering strongly from the downturn, and set to continue doing so according to the latest forecasts from the Organisation for Economic Cooperation and Development.
Italy property has another strength; above average domestic demand for holiday homes. Many of the small business leaders choose to buy second homes in their own country rather than abroad, because it means they are closer to their empires should anything go wrong. This is something to be looked at when buying Italy property, because it could solidify any potential exit strategy.
The Italian property market has been highlighted for its continued stability especially during one of the world's worst recessions by one off the industry's leading experts. In a feature in The Times, Rupert Fawcett head of Knight Frank's Italian operations said:
"Historically, property prices in Italy have always held. Italy’s second-home market has been largely unaffected by the recession. Forced sellers are rare as most properties have been bought as a long-term purchase. Prices have fallen on average 10 to 20 per cent and now, similar to the UK, prices have started to curb."
It is far from surprising to hear such statements after a 1% growth in the Italian economy was revealed in the 3rd quarter results, following a massive 8% increase in output. The Italian economy was forecast to grow strongly because it is made up of many small and medium sized enterprises, rather than by a few big companies, as in most established markets.
These small businesses were able to adapt easier, quicker and -- in most cases -- more efficiently to the changed international business arena. This is evident it Italy's return to growth being among the strongest in Europe.
Italy's property market never collapsed because the banking sector never collapsed. Also, because foreign demand has mainly been from lifestyle buyers and long-term investors, which meant there was no massive -- speculation driven -- growth in prices, and no need for a severe correction.
Now, as it becomes apparent that the worst is behind us, demand for overseas property is growing in huge markets like the UK, Eastern Europe and Russia.
It is logical that Italy would be a favourite, a: because buyers are favouring established markets, b: because Italian prices have been shown to be stable and less vulnerable to external influences and c: because the Italian economy is recovering strongly from the downturn, and set to continue doing so according to the latest forecasts from the Organisation for Economic Cooperation and Development.
Italy property has another strength; above average domestic demand for holiday homes. Many of the small business leaders choose to buy second homes in their own country rather than abroad, because it means they are closer to their empires should anything go wrong. This is something to be looked at when buying Italy property, because it could solidify any potential exit strategy.
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