Property markets in Florence see prices rise as Tuscany continues to be popular
The prime property market in Tuscany in Italy has stabilised following a decline in peak to trough terms of 40% with process in Florence and Lucca up 1% in 2018, the latest research shows.
Tuscany is one of the most popular parts of Italy with overseas buyers and almost 100,000 foreign residents now live in Florence, Lucca and Pisa and the number is expected to increase, according to the Tuscany Insight report from international real estate firm Knight Frank.
Florence recorded the largest increase of the three cities between 2012 and 2018, with the number of overseas residents rising by 38.5% and Tuscany is responsible for 62% of Knight Frank’s applicant numbers for Italy.
The report reveals that enquiries for properties in the €10 million plus sector has strengthened due to a new €100,000 flat tax, with many wealth families purchasing more than one property in Italy. Most buyers come from the Middle East, the United States, the UK, Benelux countries and India.
‘International enquiries rather than domestic demand is behind the recent resurgence. Buyers pay little attention to the political and economic landscape focussing instead on the unrivalled lifestyle on offer. For Italy, banking and governmental crises are nothing new,’ said Amy Redfern-Woods of Knight Frank’s Italian desk.
Under the tax rules introduced in 2017 individuals who take up Italian residency benefit from a flat tax on all global income of €100,000. In addition, eligible family members benefit from a flat tax of €25,000.
‘Linked to this, we have seen a detachment of the super-prime market over the last year with enquiries for properties €10 million or above strengthening. Some of these high net worth individuals already own an Italian home and following the advice of their family office, are keen to expand their footprint in the country, often seeking multiple homes across a range of locations, city, coastal or in the Alps,’ Redfern-Woods explained.
While most overseas buyers are looking to acquire a holiday home, an increasing number are seeking a permanent base. Almost 100,000 foreign residents now live in Florence, Lucca and Pisa according to Italy’s Statistics Office Istat.
‘The one trend that stands out this year is that our applicants are time poor and it influences their search in several ways. Firstly, most want a renovated project, not one that requires any work. Secondly, buyers want to be within an hour of an airport enabling them to make use of the property four or five times a year for mini-breaks and minimise travel, the days of visiting for a whole month in the summer are largely gone,’ said Redfern-Woods.
Finally, most intend to own their home for upwards of five years, often renting it out to cover costs, so a low maintenance property is preferred. Buyers continue to seek value and with prices in Lucca 20% to 25% lower than in Florence the city is firmly in the spotlight. Lucca is also easily accessible via Pisa Airport, it is located within a 30 minute drive of the Mediterranean,’ she added.