The Italian property market is now suffering the consequences of the global economic crisis, but Italians still perceive housing as a reasonably safe investment and the sector is expected to recover in 2010, the report from economic intelligence company Nomisma indicates.
Analysts found that residential property sale volumes decreased by 15.1% in 2008. However, the drop was particularly marked in the last quarter of the year, after the deepening of the financial crisis eroded consumers' confidence, it says.
In the other property sectors office sales fell by 11.7% and the commercial real estate market saw decline of 8.7%.
The report indicates that financing is harder to come by and those property transactions that are taking place involve buyers who do not have mortgages. The number of sales involving mortgages has dropped by 26.8%.
It points out that a lessening of stricter credit criteria is needed to boost the real estate market in Italy. 'The relaxation of the strict credit by banks could provide additional liquidity to re-start interest in the real estate market for families, investors and large operators,' the report says.
It is also taking longer to sell properties and the market has seen a substantial lengthening to between six and seven months.
Analysts expect further falls in prices in 2009 of around 7 to 8% with the market stabilising in 2010. Sales in 2009 are expected to decrease further by 8 to 10%.
