Italian property offers some encouraging signs for capital returns today. Find out below the factors that are bringing about such a positive growth curve in Italy’s investment property market today.
With property prices still low compared to many other Mediterranean locations, some areas of Italy are establishing themselves as promising new investment opportunities. While the cultural cities of the northern half of the country offer property at higher prices but with good capital returns, southern Italy is today gaining strength as a very promising emerging investment market.
The ENIT International Observatory Survey indicates that Italian tourism sales are up by 21.3% in 2006. Cultural tourism has always been popular in Italy, while interest in spa holidays in peaceful locations is now experiencing unprecedented interest. Italy’s tourist industry growth is also directly related to the increase in low cost airlines now serving Italy, making holiday homes and buy-to-let investments more popular than ever before.
Current trends are moving towards rural property investment where a home for renovation can still be picked up for as little as 60,000 euros. Interest in southern Italy as a tourist destination and rural getaway is gathering up steam while prices remain considerably lower here than in the rest of the country.
According to IPD (Italian Property Index), in the five-year period between 1998 and 2002 Italian property prices rose on average by some 40% (an average of around 7% per year). Property prices in major cities tend to increase more slowly (3.1% in the first half of 2003) while in 2005 average capital growth for property in Italy stood at 9%.
EU integration indicates a sound infrastructure and a healthy tourist economy where investors are enjoying solid capital returns while remaining within easy access to their investment. Economists describe Italy as a strong economy and it is ranked the fifth largest economy in terms of USD exchange rates. It belongs to the G8 industrialized nations and maintains close trade links with all EU member countries.
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