Property prices in Italy continued to drop during the third quarter of 2015, according to Knight Frank. According to its Global House Price Index, prices fell by 0.1 per cent compared with the previous quarter and by three per cent compared with the same period in 2014.
It appears, however, that buyers have stopped waiting for the bottom of the market. The Nomisma Institute forecasts that prices will continue to drop over the course of 2016, but that sales will climb by eight per cent. Homebuyers are taking advantage of low mortgage costs even as the economy struggles to recover and prices continue to fall
The Italian property market has actually remained quite stable, primarily due to the country never being heavily involved in the sub-prime lending market. Nor has it suffered the effects of the over-development of property, like Spain for example. Italian homeowners buy houses to live in rather than as an investment, and on average, move only once every 20 years. Prices, therefore, have remained relatively more realistic and have had less room to fall. The country is not immune, however, to the slower market so there is plenty of room for some price negotiation with very motivated vendors.
When it comes to finance, the availability of mortgages to foreign buyers is extremely limited, so cash purchases are the norm at the moment.
As always, it’s imperative to take professional advice before making any decisions. Prospective buyers should always go through the same process that they would follow if they were buying a property in the UK, and this includes consulting a good independent lawyer, and ensuring that an independent valuation of the property takes place, especially if it’s a cash purchase. There’s nothing to be gained, and everything to lose, by cutting corners and taking unnecessary risks.