According to the latest Economic Survey on the Housing Market in Italy, covering the first quarter of 2023, conducted by Bankitalia, Tecnoborsa and the Agenzia delle Entrate (Inland Revenue), inflation trends will continue to have a negative impact on demand for housing. Real estate agents in Italy view the outlook for the sector unfavourably, with sales prices essentially stable, but rent rising sharply. Nearly one in three also report difficulties in obtaining mortgages from buyers. This is the latest on the Italy real estate outlook for 2023.
Housing Market Survey Italy
The Housing Market Survey was conducted among a sample of 1,458 real estate agents in Italy from 3rd April to 4th May 2023 and covers the first quarter of 2023. According to the real estate agents surveyed, inflation will continue to weigh negatively on the housing market outlook, with a contraction in demand. In a market where it is becoming increasingly difficult to obtain a mortgage, property prices are considered stable, while rental prices are rising sharply.
House prices in Italy are stable
The majority of respondents still rate house prices in Italy as stable when it comes to property for sale, while the average discount on sale prices compared to initial enquiries is falling again. Sales times also fell, reaching a new low since the beginning of the survey. The share of agencies that sold at least one home in Q1 fell, to a greater extent in urban areas and large cities.
Increasingly difficult to find a mortgage in Italy
30% of agents report that it is becoming increasingly difficult for buyers to find a mortgage to purchase a home in Italy. This is the highest figure since the beginning of 2015. Around half of the agents also report that among the prevailing reasons for ceasing to sell is the value of offers deemed too low by the seller, while a similar fraction indicate asking prices deemed too high by buyers.
The share of sales financed with a mortgage loan in Italy also fell, especially in large metropolitan areas, to 64.1%. The ratio of loan amount to property value remains high at around 76%, slightly down from the previous survey.
Rent in Italy rising sharply
One in two operators reports an increase in rent in all geographical areas, most markedly in the south and centre of Italy, with levels very close to those in the north. And according to most operators, a further increase is foreseen during Q2 2023, while there is also a decrease in the discount compared to the landlord's initial requests.
Italy real estate outlook according to market experts
As far as the future of the sector is concerned, a general pessimism prevails among experts, even on a two-year horizon. Expectations of a decrease in new assignments to sell in the second quarter prevail, and the gap between expectations of an increase and decrease in sales prices has widened further.
A negative impact on housing demand will be expected when it comes to inflation. As well as this, the government's recent changes to the superbonus, with new constraints on credit assignment, could also have an overall negative effect on the number of potential buyers and sales prices. On the other hand, half of the operators expect the changes to have no significant impact.