Real estate 2022: in Italy, sales are down, prices are up

Stefania Pescarmona
Stefania Pescarmona
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The Italian residential market should close 2022 with transactions down to 730 thousand, compared to over 748 thousand in 2021, but with prices up by 2-4%. The estimates of Tecnocasa
A decrease in buying and selling volumes in Italy but an increase in average property prices. These are the closing forecasts for the year 2022 for the Italian residential real estate market from Tecnocasa, which estimates a contraction in transactions to 730,000, from more than 748,000 in 2021, but a continuation of price growth, in a range of 2 to 4 percent.

"The trend of the real estate market in the coming months is closely linked to economic developments and how they will impact the credit sector and the attitude of banks with which the desire to buy a home will have to reckon with," commented Fabiana Megliola, head of the Tecnocasa group's research office, during the press conference, who expects more cautious buyers, especially among younger age groups and those with lower spending power.

Purchases and sales in 2022

The favorable momentum of the Italian real estate market continues: in the first six months of 2022, residential sales in Italy rose 10.1 percent, exceeding 400,000. Capital municipalities recorded a slightly higher volume growth rate than noncapital municipalities (+10.7 percent vs. 9.8 percent), reversing a trend that emerged last year on the search for larger homes with outdoor space and more accessibility.

"The desire to buy homes has continued to animate a market that, in recent times, has not slowed down thanks to the important support of the credit sector. In addition, high inflation has suggested the brick as a form of capital defense, which has thus been poured into the vacation home and the rental home," explained Megliola, who then went on to say that growing demand for real estate has been countered by an inadequate supply, in quantity and quality, as a result also of the shortage of raw materials and their increased costs, and this is one of the factors behind the price growth.

House prices in Italy

House prices continue to rise in all territories. According to Tecnocasa's data, large cities put up a 1.8 percent increase, just as had happened in the previous six months; this is the most significant change since the second half of 2017 when the market re-emerged from the prolonged crisis that had affected it. Milan again stands out among large cities with a 4 percent increase, followed by Bari with +3.8 percent. Genoa is once again in positive territory with +0.9 percent, after a slowdown in the previous six months.

In large cities, home values in suburban areas are growing more than in semi-central and central areas. In the hinterland of the metropolises, houses continue to gain value with a growth of 1.5 percent in the first part of 2022. Exceptionally bright is the price trend in the province of Verona, thanks to the pull of the tourist resorts on Lake Garda, which for several semesters now have stood out as particularly attractive.

The provincial capitals recorded a price increase of 1.5 percent, a slightly worsening result compared to the previous semester, mainly due to the performance of cities in southern Italy. There is no shortage of provincial capitals with above-average price increases, including Ferrara (+8.5%), Reggio Emilia, and Trieste (+6.8%).

The rental market in Italy

In the first half of 2022, at the national level, there was an increase in the percentage of purchases for investment (16.8%). "This is an increasing share compared to the last two years, but it still does not reach the levels of 2019, before the arrival of the pandemic, when it reached almost 18%," said Piero Terranova, analyst study office of the Tecnocasa group -Investment rates are on average higher in large cities, with Naples leading the ranking with a strong presence of investors (34.9%). There is also a return of investors in Milan, which will account for 23.2 percent of total purchases and sales in the city, a percentage that is still lower than in 2019."

After the sharp drop in values that occurred in 2020 due to the pandemic, the rental market recovered immediately after the fall of restrictions. With the return of students, off-site workers, and the critical return of tourists, which have revitalized the short-rental segment, rents are growing again. In the first part of 2022, the latter registered an increase of 2.1 percent for studio apartments, 2.4 percent for one-bedroom apartments, and 2.2 percent for two-bedroom apartments. Once again, Milan highlights more significant changes than other cities, with +4.8% for studio apartments, +4.7% for one-bedroom apartments, and +4.5% for two-bedroom apartments. "The rental market consecrates the return of students and transfer workers, who had already shown signs of recovery in the second part of 2021.

In Italy in the first half of 2022, 25 percent of rentals are stipulated by transfer workers, 3.8 percent by university students, and 71.2 percent by people who have chosen to live in rentals," explained Terranova, who then recalled that university students move on the market mainly in the second part of each year; in fact, in the second half of 2021 they made up 13.1 percent of the total number of stipulated contracts. Slightly different is the situation in Milan "where 45.6 percent of the rents concern transfer workers and 13.6 percent university students, the latter in the second part of 2021 reached 35.6 percent," he concluded.
Director of and editor-in-chief of the magazine. A professional journalist, she holds a law degree from the University of Turin. She has worked at MF, Bloomberg Investments, and Finanza&Mercati. She has contributed to Affari&Finanza (Repubblica) and Advisor.


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