With most of Europe’s property markets now in recovery, Italy is still languishing near the bottom of the house price league. Only Greece, Cyprus and war-torn Ukraine posted a worse performance in property price growth in 2015.
So does Italy present an excellent buying opportunity for overseas property hunters or a risky gamble?
On the plus side Italy’s economy may have been struggling to recover from a crisis in recent years, but there are some promising signs that green shoots are beginning to emerge. The IMF is predicting economic growth for this year and next while the central bank is even more optimistic about recovery.
Property prices in Italy fell by more than 3% in 2015 Source: Knight Frank Global Property Index but the recent economic recovery could also bring a long awaited change in fortunes for the property market.
Italians are now more likely to be out shopping again as they begin to feel more confident about their future prospects. Unemployment in Italy looks like it may fall below 11% nationally by 2017 which would be the first time it has done so in quite a while.
Sunset by a lakeside village in Rieti.
North South Divide Continues To Hold Back Italian Economy
Unfortunately there is one big elephant in the room whenever anyone talks about economic matters in Italy – the north/south divide. Italy’s north/south divide has been in place since anyone can remember and the problems are deeply entrenched. Italy is famous for its ice cream and if you imagine it as a large ice cream cone with the best pits at the top, then you will be close to seeing where most of the investment and economic prosperity can be found.
Yet all of this misses the point about Italy. You don’t buy property in Italy to make money, you buy in Italy because you love the climate, the lifestyle and the effortless sense of style that is everywhere from its cars to clothes and interior design.
Italy is famous for its ice cream and if you imagine it as a giant ice cream cone with the best bits at the top, then you will be close to seeing where most of the investment and economic prosperity can be found.
Rome Remains A Hotspot
According to The Move Channel’s Q4 2015 Hotspots Index Rome continued to be the most searched-for location in the world, a position it has held for three consecutive quarters. So even with its rather shaky and unreliable economic reputation, people are still drawn to Italy above alternative locations such as Spain, Greece and Cyprus.
Vittorio Emanuele Monument Rome
Property Bargains Lie Undiscovered In Central Italy
As overseas property hunters considering Italy will be aware, there is much more to Italy than its historic capital and there will be plenty of opportunities to snap up bargain properties.
The best regions to invest are those sandwiched in the centre between Northern and Southern Italy. While Tuscany is a well-trodden path for Brits, there are also less well explored areas such as Abruzzo which offers an attractive combination of spectacular scenery and unspoilt character with rock bottom property prices.
Italian property portal gate-away.com is currently advertising a completely restored town house in Abruzzo set within a medieval village with panoramic views of the mountains for £21,000 – less than the price of a ford Mondeo.
Completely restored and panoramic town house in Abruzzo on a hill-top medieval village – £ 21,000. Source: gate-away.com (ref. AR 343).
Abruzzo is largely off the beaten track and attracts little in the way of tourists, yet the region is a treasure trove of medieval villages and small hill top hamlets. According to gate-away.com the region has risen to the third most requested Italian region to invest after Puglia (2nd) and Tuscany at number one.
For those looking to buy property in Italy in 2016 it is a case of the earlier the better to lock in current prices. The Bank of Italy has forecast that the country’s gross domestic product (GDP), will be enhanced by a rise in domestic demand.
This may feed into a steady increase in property prices in the more sought after regions of Italy by the end of 2016. Add to this a favourable exchange rate to the Euro and there has rarely been a better time to invest in a holiday hideaway in Italy.