International real estate and grand daddy of the overseas property sector Homesgofast.com reveal that Italian homeowners made up the largest sector of vendors to list their homes in August 2016.The website carries nearly half million international listings from both agents and owners from more than 50 countries worldwide, however Italy topped the FSBO or its For Sale By Owner listings. The reasons for the trend is unclear, does this show that the Italian property market is heating up?
1. Italy - 19% of listings posted in August
2. Turkey - 15%
3. Canada - 7.5%
4. Spain - 5%
5. Costa Rica - 2%
August 2016 figures reveal that Italian homeowners listed their houses for sale more than any other country. Turkish homeowners came a close second followed by Canada, Spain and Costa Rica.
Italian real estate offered for sale by owner in August 2016
Italian property owners seeking an international buyer listed a wide range of Italian property for sale examples of the real estate offered
6 bedroom home in Apulia – Italy
A hillside villa in perfect condition , 219 mt. above sea level, in a quiet residential area 8 Km far from the Adriatic sea, in the sunny Apulia region (South-East Italy).
9 bed villa in Abruzzo
Large, bright and well located villa with a wonderful view of the Majella mountain. The villa consists of three apartments on the first floor, a wide apartment on the second floor, a basement tavern, a double garage and a large loft on the last floor.
2 bed Villa for sale Ausonia - Lazio – Italy
In Ausonia, 15 minutes from Gaeta coast, a new country villa built on 2 floors, 110 sq.m. house + 30 sq.m. garage, the ground floor left for finishing, close to Aurunci Natural Park.
Homesgofast.com founder Nick Marr
‘ It seems the majority of homes beings advertised by Italian home owners make ideal holiday homes. Holiday home rental income is very attractive. We have seen rental listings in Toscana, Grosseto at £320 per night for 2 bed home. At the same time Italy has a huge percentage of people who own their own homes. Some owners we speak too feel they are more likely to sell to an overseas buyer owing to difficulties locally in obtaining mortgages in Italy. Overall our years of experience in this sector shows increasing vendor activity means activity in the housing market for that region. Our finding reflect those of consultants Knight Frank who predict a stable and strengthening Italian property market ”
Based on the figures from ISTAT's Population Housing Census in 2011, around 71.9% of the country's total households are owner-occupiers, an increase from 59% in 1980.
Among Italy's regions, the North-East had the highest home ownership rate of around 73.8%. It was followed by the Centre with 72.9%, the North-West with 72.1%, and the Islands (consisting of Sardinia and Sicily) with 72%. The South had the lowest home ownership rate at around 68.9%.
GlobalPropertyGuide attribute the high levels of Italian home ownership to :
· Mortgage borrowing is now much easier.
· Living standards have risen, despite relatively slow economic growth.
· There are tax breaks for ownership, mortgage relief, and low value assessments when calculating imputed income tax and capital gains taxes
· New housing supply is almost exclusively destined for home ownership
· The Fair Rent Act of 1978 established a common four-year lease, and continued rent controls
Italian law is strongly pro-tenant, according to Global Property Guide. Because of strongly pro-tenant landlord & tenant laws, the rental market is shrinking.Rents can initially be negotiated but increases are restricted. Landlords can only increase the rent after the initial 4-year contract.
Tenant Security: Tenants have the right to controlled rents plus eight years or more of security of tenure. A landlord may only serve a ‘disdetta’ – a registered letter of notice which must be sent at least six months before contract expiry – to coincide with the end of the standard 4 years. Failure to do so automatically renews the contract for another 4 years.
Kinightfrank guide to Italian property ownership cost state that In summary, the overall costs of purchasing property in Italy depends on the stamp duty and purchase tax rates applicable to the asset. These costs consist primarily of property taxes, notary fees and agency fees. As a very general indication this can be expected to amount to circa 10 to 12 % of the purchase price.
Italian House Prices
Italian real estate prices will stay level as buyers return to the long-term trusted locations, according to another report by global real estate consultancy Knight Frank. They go on to predict growth in sales activity will strengthen in Tuscany, Florence, Umbria, Liguria and Sardinia, while Rome, Venice, Florence and Milan will remain stable, indicating a recovering housing market and a strengthening national economy.
Income tax is payable in Italy by all property owners on the theoretical rental income of the property during the year; non-residents in Italy are subject to this tax only if the income exceeds a certain threshold. IMU: Council tax (Imposta Municipale Unica) is a property tax based on the land registry value of the property and is collected by the local authority twice a year.
There is currently no Capital Gains Tax in Italy for private individuals if the disposal of a property takes place more than five years after the purchase. All foreign owners are advised to draw up an Italian will. The standard IVA rate in Italy is currently 21%