Nomisma: the slow recovery of real estate in Milan

12 July, Milano Finanza

The Milan property market is continuing its slow but gradual recovery process, although it’s taking longer than expected, according to the second 2018 real estate report by Nomisma. As the memo reads, in 2016 the growth of transactions for residential properties started in 2014 registered a two-digit increase (+21.5%), followed by a further rise in 2017 even though for a smaller variation (+8.1%), continuing in the first quarter of 2018 but significantly reduced (less than 1%). The operators of the market sensed the increase of the transactions. Concerning rents, the steady demand has driven the market. The rental market anticipated and confirmed those trends that are struggling to take off on the property market. The recovery of rents is shown by the prices (+1.1% on a yearly basis) for the third consecutive semester and by the rather short times to find a tenant (2.5 months on average). The property market is slowly getting closer to the positive values. Prices continue to grow (+0.7% on a yearly basis for new properties and +0.1% for dated ones), suggesting a return of liquidity. The outlook for the next semester is for a positive performance of transactions and rents with the increase in quantity and prices.

The performance of offices and shops is still negative and below the average levels for the last 20 years. The demand is also weak, while transactions are slowly recovering. More in detail, sales for offices have decreased in the first quarter of this year compared to 2017 (-1.2%), whereas those for shops have risen (+2.1% in the first quarter of 2018). The biggest difficulty of the office segment is the price trend, with unvarying prices (-0.2%), while prices for shops are growing (+1% on a yearly basis).

Source: Milano Finanza

Translator: Cristina Ambrosi

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