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PROPERTY

The Italian properties ‘nobody’ wants to buy in 2021

The lockdown and travel restrictions caused by the pandemic are changing what potential buyers are looking for in future homes in Italy, as well as what they’re trying to avoid.

The Italian properties ‘nobody’ wants to buy in 2021
Photo: Filippo Monteforte/AFP

It’s a generalisation, but it’s fair to say that before the pandemic many Italians didn’t give too much importance to the place they put their head down to sleep at night.

Italy is statistically a nation of apartment-dwellers (more than two-thirds of the population live in apartment blocks), preferring to spend most of their time outdoors and meeting friends and family in cafés and bars rather than hanging out at home.

This doesn’t mean people in Italy don’t care about the state of their homes – far from it, in fact. But one cultural difference those from northern Europe often find with Italian partners or flatmates is that there’s not much interest in making the space especially comfortable or cosy. After all it’s mainly just somewhere to sleep, shower, and make a quick coffee before dashing to work.

Or at least, that was the case until about a year ago.

The pandemic seems to be changing several property trends in Italy, including the penchant for apartment living that’s been around since the 60s.

Photo by Tiziana FABI/AFP

We’re not predicting that Italians are all looking for a life in the suburbs now that remote working is catching on. But some property types have become far more popular – others less so.

The following are all factors to bear in mind if you’re thinking of selling or buying a property in Italy in 2021.

Too small

More space was one of the things Italians under lockdown yearned for most in 2020, and this is clearly reflected in current market trends.

The average size of an Italian home is 81 square metres – smaller than the Spanish (97 m2), German (109 m2) and French (112 m2) averages.

READ ALSO: ‘Smart working’? Here’s what you need to know about going self-employed in Italy

According to a study by real estate website Immobiliare.it, searches have increased for properties that are 100 sqm or larger over the past year.

This change in priorities is thought to have contributed to property price drops of more than 10 percent in central parts of big cities such as Milan, Rome and Bologna, where small apartments have long been the only affordable option for most.

Photo: Andreas Solaro/AFP

No outdoor space

There’s no doubt Italians will continue living in blocks of flats once the pandemic is behind us, but having some form of outdoor space such as a balcony, a terrace or a garden is more important than ever. 

According to property search engine Idealista, the filter for homes with balcony or terrace is now being used up to 40 percent more than this time last year.

And it seems that some people have re-evaluated their priorities completely and are searching for even more space.

In Italy, rural homes have long been perceived as the preserve of retirees and foreign second-home owners – but this is another trend that appears to be changing.

One survey last year highlighted a rising trend among young people (20 percent more than during the same period in 2019) hoping to move away from urban areas.

READ ALSO: 

Italy has a large stock of older, often rural properties which have long proved difficult to sell in a market where apartments and new-build homes have long been more in demand.

But the government’s renovation superbonus, introduced as part of a package of financial aid for the country, is now making the prospect of renovating an old house in the countryside a more realistic prospect – especially for younger generations who previously would’ve been unable to afford such a project.

READ ALSO: Italy’s building bonus: Can you really claim back the cost of renovating your Italian property? 

“This is quite interesting as it speeds up the requests for properties in need of huge renovations,” noted Sara Zanotta of Lakeside Real Estate, based on Lake Como.

“Enquiries for this kind of property will increase in 2021 by up to +45%,” she told The Local in January.

“From July 2020 to December 2020 these requests increased by +32% on the same period in 2019.”

Photo: Miguel Medina/AFP

Outdated or no facilities

Older houses and apartments with an outdated layout, lack of natural light or poor funtionality are big no-nos nowadays in Italy thanks to the pandemic, as well as being key factors in why new, more practical builds are likely to see prices remain stable.

However while old-fashioned apartments with long corridors and lots of tiny rooms are not desirable, more modern open-plan layouts (or “open space”, as they’re often called in Italy) are also becoming less popular as people now spend more time at home, estate agents say.

Since most apartments available in Italy now fit one of those descriptions, buyers are reportedly making more changes to new homes than before – knocking through walls or otherwise altering unsuitable layouts.

Properties without a lift in the building or without parking spaces are also less in demand. 

Among estate agents’ predictions for Italy’s property market in 2021 are an increased interest in “multifunctional homes, with larger dimensions and modular spaces adapted for remote working.”

And those who do continue living in apartments will increasingly be looking for blocks with more facilities, “such as a garage, gym, storage or multipurpose spaces.”

Location, location

Houses in premium locations, such as by the coast or lakes, have also always commanded higher prices and this is unlikely to change.

However, property prices in areas outside regional capitals rose, in many cases for the first time in years, as property experts say people are increasingly looking for larger homes in quieter areas.

“Non-capital municipalities grew most of all, by +8.1%, compared to an overall decline for the capital city municipalities (-6.7%),” a joint report by Italian estate agencies Gabetti, Professionecasa and Grimaldi stated.

As in many other countries, Italian cities are experiencing the trend of losing some of their population as people move to the provincial outskirts of the big urban areas in search of space, greenery and more freedom. 

READ ALSO: 

While real estate agencies focused on the international market say there’s continued interest from would-be buyers abroad despite the pandemic, Italians too are increasingly looking at buying a second (or first) home in the country.

But as well as the traditionally expensive areas, demand is rising in previously less sought-after parts of the country.

Many are considering relocating to rural areas due to the rise of remote work or ‘smart working’, with southern Italy now a sought-after destination among people looking to swap city life in the north for a lower cost of living.

While there are suggestions that more people may move back to Italy’s many depopulated hilltop towns as a result of the pandemic, these hopes may be hampered by the fact that such areas usually lack infrastructure and internet connectivity.

If a property offers neither the transport connections of a city nor the extra space afforded by the countryside or suburbs, it’s unlikely to be snapped up under the current circumstances.

See more in The Local’s Italian property section.

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MONEY

How to get a discount on the cost of solar panels for your Italian property

Solar panels are an understandably popular choice in Italy, and if you're thinking of installing them on your own home there's funding available to help lower the cost. Here's what you need to know.

How to get a discount on the cost of solar panels for your Italian property

As utility bills rise, more home and business owners in Italy are looking at installing solar panels as a possible way to reduce costs in the long term.

Solar panels are already hugely popular in Italy, with the nation ranking top worldwide for solar-powered electricity consumption.

READ ALSO: Who can claim a discount on energy bills in Italy?

And no wonder: it’s a solid bet in a country where there is sunshine in abundance. But what about the costs of installation?

The good news is that there’s financial help available from Italy’s national government aimed at encouraging uptake of solar energy, as well as other incentives from regional authorities in many parts of the country.

It’s in the government’s interest to incentivise solar power, as Italy has vowed to transition to greener energy with its National Integrated Plan for Energy and Climate (Piano Nazionale Integrato per l’Energia e il Clima 2030 or PNIEC).

So how could this benefit you? Here’s a look at what you can claim at both a national and a regional level.

Regional funding for installing solar panels

As well as the national government subsidies available for covering the cost of solar panel installation, some regions have introduced their own bonuses or discount schemes.

The sunny southern region of Puglia and the wealthy northern region of Lombardy have seen the highest number of residential photovoltaic systems installed, according to market research.

it’s not surprising, then, that these two regions’ governments are offering cash incentives to help cover the cost of installing solar panels.

Depending on the type of system you opt for, you could expect to pay between around €5,000 and €13,000 for installation, design, labour and paperwork.

To contribute to this initial outlay, the local authority in Puglia has created a pot to help homeowners on lower incomes move towards renewable energy.

READ ALSO: What you need to know about installing solar panels on your home in Italy

Newly introduced in 2022, the so-called Reddito energetico (energy income) offers households with an annual income below €20,000 a bonus of up to €8,500 for installing photovoltaic, solar thermal or micro-wind systems in their homes.

The bonus is intended for residents who have citizenship of an EU country or, if you are a citizen of a non-EU country, you can still claim the bonus if you have been resident for at least one year in a municipality in Puglia.

The €20,000 annual income refers to a household’s ISEE – an indicator of household wealth calculated based on earnings and other factors.

A worker fixes solar panels. (Photo by Ina FASSBENDER / AFP)

For this particular scheme, if you claim this bonus from the authorities in Puglia, it precludes you from also claiming funds at national level concurrently – such as through the popular superbonus 110 home renovation fund (see below for more on this).

Although there are other government bonuses, such as the renovation bonus (bonus ristrutturazione) that offers a much higher maximum total expenditure of €96,000, it can only be claimed as a 50 percent tax deduction spread over 10 years in your tax return.

For lower income families in Puglia, this may not be as cost effective as the grant from the regional authorities, which may equate to more money towards the cost and supply of solar panels.

For more information and to apply for Puglia’s renewable energy bonus, see here.

Lombardy is also stumping up funds to continue the solar power momentum experienced in the region.

While the coffers for private properties are currently closed, the region has made funds available for those with small and medium-sized businesses – again, in a move designed to lessen the impact of rising energy costs.

Business owners can claim a 30 percent grant for the installation of solar panels. There are more funds available to cover the cost of consultancy during the process too.

For more details on applying for this energy bonus in Lombardy, see here.

Other regions have also taken the initiative with encouraging more homes and businesses to change to solar-powered energy.

The region of Tuscany is offering an incentive on installing solar panels to residents in the form of tax deductions spread out over several years.

Works permitted include installing winter and summer air conditioning and hot water systems using renewable sources. This covers heat pumps, solar panels or high-efficiency biomass boilers.

For further details and information on how to apply, see here.

Each region may have its own solar panel bonus, either in the form of grants or tax deductions, available to private residents and/or businesses.

Check your regional government’s website to find out what may be currently on offer.

Solar panels are an increasingly popular option for those renovating homes in Italy. Photo by Jeremy Bezanger on Unsplash

National subsidies for installing solar panels

If your region isn’t offering any cash incentive to install solar panels on your property, there are government funds available, which cover all 20 regions.

The authorities introduced and extended a package of building bonuses in order to galvanise the construction industry following the economic downturn caused by the pandemic.

While there is no single, separate package of incentives for installing solar panels in 2022, you can take advantage of other government bonuses that include the cost of solar panel installation and supply.

As noted, you could use the renovation bonus (bonus ristrutturazione), which amounts to a 50 percent tax deduction spread over 10 years in your tax return – or through the superbonus 110, a scheme that promises homeowners a tax deduction of up to 110% on expenses related to property renovation and making energy efficiency measures.

READ ALSO:

The property must make at least a double jump in energy class or reach the highest efficiency rating when accessing these bonuses.

There’s a substantial amount of funds on offer to install your solar panels.

Using the renovation bonus, there is a maximum total expenditure of €96,000 (per single housing, including condominiums). Remember this amounts to a 50 percent tax deduction, so the maximum saving you would make is €48,000.

The renovation bonus has been extended until 2024 and, where solar panel installation is concerned, you can claim for the costs of labour, design, surveys and inspections, as well as VAT and stamp duty.

You must tell Italy’s energy and technology authority, ENEA, that you’ve done the works within 90 days in order to access the state aid for solar panel installation.

If you choose to use the superbonus route to claim funds for your solar panels, however, you can spread out the tax deduction costs over five years. Alternatively, you can apply for it as a discount on the invoice (sconto in fattura) or through the transfer of credit (cessione del credito).

The limit when using this bonus is €48,000, which can now be accessed for a while longer as the government extended the deadline for single family homes.

See HERE for details on how to claim it.

See more in The Local’s Italian property section.

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