Italy sees green shoots of recovery

Photo: Nadio

Europe has had a shaky start to 2015, with the uncoupling of the Swiss France against the single currency, the ECB's introduction of QE and Greece's ongoing bailout negotiations fuelling uncertainty. For some countries, though, that is spelling a promising year ahead. In Italy, for example, agents are seeing a strong return in buyer interest.

"Stock levels remain high, and, as we move into the traditional spring selling season, more good quality homes are coming onto the market," says Rupert Fawcett, Knight Frank’s Head of Italian Sales.

The affordability, though, is the biggest factor in stimulating demand. Buyers are becoming more realistic on their asking prices, but values are 30 per cent below the 2009 peak, with even larger falls in Umbria and Lombardy. Combined with the euro hitting a seven-year low against the pound, Italy's prospects for investors are appealing.

The gradual bottoming out of the market, too, is good news for buyers seeking capital growth.

"There is a growing sense that prices have reached the bottom of the curve and that whilst we are unlikely to see price growth in the short term, we are also unlikely to see significant falls," adds Fawcett.

"Sterling and the dollar are now at record highs against the euro making a second-home purchase in Italy even more attractive to buyers from the UK, the US and increasingly amongst expats who have relocated to Asia."

In the initial fallout of the Greek election, the uncertainty caused had "little impact" on enquiry levels, says Rupert, which will reassure agencies going forward. Indeed, Knight Frank saw viewings of Italian properties on its site jump 31 per cent between January and December.

"Tuscany continues to generate the highest number of viewings and sales," adds Fawcett, "but Liguria, Venice and Rome are also attracting strong interest. The latter two underline the increased interest in city living, with Florence joining this triumvirate. Whilst an improved lifestyle remains the key motivation amongst buyers in Italy, the potential investment opportunity is increasingly a consideration for those looking at a city purchase. Apartments provide an easier ownership route without the need for a large capital outlay and minimal ongoing maintenance."