Overseas investment returning to Italy

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Italian property prices continue to fall and in doing so have caught the attention of overseas investors.

Sales suffered a dramatic fall of 26% across the country in the last year amidst problems for Italian nationals in terms of getting mortgages and paying the extra taxes levied as part of the austerity measures of the previous government.

However, overseas investors are estimated to have injected more than two billion euros into the country by buying second homes in 2012.

New figures from Scenari Immobiliari reveal that second sales to international buyers increased by 14%, with German nationals accounting for 40% of the purchases. British and Russian buyers were next in line, accounting for 18% and 13% of sales respectively.

Scenari Immobilari’s report also found that the average international sale price was around the €500,000 mark, a break point that is simply beyond the reach of many Italian buyers at the moment.

The general outlook for Italians isn’t looking good either, with current high employment rates unlikely to improve in an economy that is expected to shrink further this year.

House prices are currently down 12% from the high levels in 2008 and many analysts, including the Nomisma Institute, are predicting further falls of 5% this year.

Luca Dondi, head of Nomisma’s real estate research unit, said: “The decline in sales was a surprise, because we thought we had touched bottom or close to it in 2011.”

However, the falling prices are continuing to appeal to foreign second home buyers, although the big money investors such as hedge funds look likely to hang back until there is a general consensus that the market has finally hit rock bottom.

If you are thinking of taking advantage of the good value deals in Italy you will need to think carefully about how to transfer money worldwide. Compare the exchange rates offered by specialist currency firms with those available from the banks, as there are generally better deals to be found away from the high street.

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Overseas investment returning to Italy

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