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The demand for heritage houses has decreased

26 November, Il Sole 24 Ore

The preference goes to new houses, while heritage houses are penalised. The legacy of old times, with its history and arts, old palaces and houses: they are now a market niche which has to deal with a demand focused on convenient and “re-sellable” locations and which requires costly maintenance work.

Scenari Immobiliari president Mario Breglia commented: “We can distinguish between two different markets. The old houses in city centres are generally well-positioned and featuring fine details such as frescoes, vaults, unique entrances or high ceilings. Prices for such properties are indicative, as they are unique. In minor locations, on the other hand, we register a modest demand”.

Prices are to the roof in Rome and Milan, with peaks of 16,100 euro/Sq m in Piazza del Popolo and 14,600 euro/Sq m in Brera. Prices are well over 10,000 euro/Sq m also in Posillipo in Naples, San Marco in Florence and Duomo-Signoria in Florence.

Therefore, there is a market in Milan, Rome, Florence and Venice. On the contrary, Genoa is struggling, and there aren’t that many heritage houses there. Scenari Immobiliari stresses how Palermo has undergone a remarkable renovation of its old town in the last few years. For this reason, the city centre has become more appealing, after spending years in a state of semi-abandonment.

The maintenance is definitely expensive. Breglia says: “It’s part of the game. It’s like purchasing a vintage car. You know there will be extra costs”. In addition, there are also some restrictions to respect if the property is protected by the Superintendence. There are, however, some tax reliefs, as the Imu tax is reduced for historical buildings.

The market shrinks as the dimensions grow. Such properties are difficult to reconvert. A palace or a little castle is not high on demand. There’s a very high demand for unique properties, considering the excellent Italian cultural heritage, but the demand is close to zero. It depends a lot on the location. While the interest for a castle in the province of Cuneo is almost non-existing, a historical house like Villa Reale di Marlia near Lucca, formerly owned by Elisa Bonaparte, was bought by a wealthy Swiss entrepreneur to turn it into a luxury hotel. Sometimes, it’s hard to tell the value of the properties. Breglia continues: “A castle may cost up to 300 thousand euro, but it takes some other 50 thousand to keep it in good conditions. The operation is not feasible if there isn’t a real passion for the genre”.

“Heritage conservation, given its abundance in Italy, is critical for the sector”, explains Gaddo della Gherardesca, president of Adsi, the association for the Italian heritage houses. He denounced the difficulties and the costs to requalify the vast heritage, in most case in a state of neglect. “Taking as an example the farmhouses in the Arezzo countryside, their renovation is too expensive, starting from 1,500 euro/Sq m. The investments have no returns. Our objective is to denounce the struggle of the whole sector and work with the local associations”.

It would represent a driver for the growth of the local economy, as the Adsi president reminds. Between 2007 and 2017, three billion euro were invested in maintenance works every year; 21 billion only for extraordinary expenses. “Maintenance costs on average 90 thousand euro. The local economy might benefit from such investment”. 30% of the city assets are being requalified as retail and office assets. But 70% of historical properties are located in the province, in remote areas not reached by international or Italian buyers.

There have been some cases of successful and expensive requalification. In Tuscany, it’s possible to reconvert heritage houses as the local law permits a more flexible use. Several property owners caught the opportunity. For instance, Palazzo Niccolini al Duomo, in the Florence old town, with roots dating back in 1250, became a luxury hotel.

Other requalification examples can be found in Galatina, a small town in the province of Lecce, Puglia, rich on baroque-style buildings which are gradually being renovated. Some of them are being used as temporary hotels, like Mongiò dell’Elefante. The property was acquired and remodelled by Antonio Scolari and Christian Pizzinini, and it now hosts exhibitions and travellers.

Source: Il Sole 24 Ore

Translator: Cristina Ambrosi