Messina bridge and property tax abolition means Calabria is one to watch

Newly elected Italian Prime Minister Silvio Berlusconi, will need to find an astounding €2 billion to keep his election campaign promise of getting rid of the main Italian property tax.

Real estate investors are being urged to wait and see rather than plunge into the Italian market as there are concerns that Berlusconi might not be able to keep his promise.

The principal Italian property tax (ICI) will cost a lot of money if it is abolished – it is estimated that around 2 billion Euros will be lost to the Italian exchequer.

This is against a background of needing to find the money for many other pre-election pledges.

However, the news still looks promising for foreign property investors looking at property in Italy. Fees and taxes are a large part of any overseas property investment therefore the abolition of any of these will make a significant different to property purchasing in the country.

There is already no capital gains tax on Italian properties if they are owned for more than five years, therefore if Berlusconi does go ahead with his pledge, there is even more incentive for people to buy in Italy, and this in turn could help push property prices up.

However another Berlusconi election promise is to revive the building of a bridge over the Strait of Messina between Sicily and Calabria. This area is attracting interest from property investors because of its diverse range of available properties. There are wrecks that need total renovation, farmhouses that can be done up quite easily and a range of new apartments and off-plan apartments. 'The nice thing about this part of Italy is that even the new properties are built to blend in with what already exists,' said Almira Chiang, an agent in Calabria, where it is possible to ski in the morning and spend the afternoon on the beach.

Despite the huge cost there is hope, she claims, that the bridge, which was halted by the previous government, will be completed. It is a plan that goes back to Roman times. 'Whatever happens the area is set to get more and more visitors and the government has promised to invest in the infrastructure,' she added.