Italian property tempting German buyers

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Set against a backdrop of poor residential sales and tight mortgage lending, the state of the domestic Italian property market was one of the main points of discussion in the recent election in the country.

As well as pressures brought by the continuing eurozone crisis, the increases in taxation levels that have been applied to house purchases in the country in one of the previous government’s austerity measures had been putting an increased strain on Italians looking to buy.

Housing transactions fell by almost 26% in 2012 and values have fallen by 12% since their peak levels in 2008, leaving many Italians unhappy about the situation.

However, one lot of buyers who seem to have no qualms about getting involved in Italian property are the Germans, and Bloomberg has reported that there is a growing number of German investors who are taking advantage of the fact that many locals can’t afford to buy at the present time.

Many Germans are looking at ways to hedge their bets against inflation, and with their own economy behaving in a way far different from the rest of Europe, holiday homes in other countries are being seen as a way of protecting savings and looking towards retirement portfolios.

With Italian sellers eager to strike a deal - some estimates say that prices can drop as much as 30% during sales negotiations - now would seem to be a good time for those with money to invest in order to stake a claim in the market.

With a continuing strong tourism industry in Italy, rental yields are high, as is demand. As prices per sqm currently stand at €6,327 and monthly rents at €2,558, according to the Global Property Guide, yields are at a decent level of more than 4%.

If you are looking to invest in Italy, it is worth thinking carefully about how you will send money abroad. There are many different options available, so you need to compare the market beforehand to ensure you get the best deal when it comes to transferring funds. Using currency exchange specialists rather than the big banks is one way to do this.

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Italian property tempting German buyers

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