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Rents have returned to pre-crisis values

24 November, La Stampa

Rents are rising again, while property values continue to decrease. The rise in rent prices has been going on for the last four years, reaching peaks of 3.1%. Rents have now returned to pre-crisis values, that means ten years ago. The expenses for rents are now only 5.8% lower than the 2009 values. The average rent was then 641 euro. The numbers are taken from the latest report by Solo Affitti, a real estate network specialised in rentals with almost 300 agencies. The survey was curated in collaboration with Nomisma. According to the report, 2014 was the worst year, when rents dropped to 545 euro, plummeting by 15% from 2009. Since then, a slow recovery started, for then accelerating in 2017 (586 euro, +4.1% compared to the previous year) and, indeed, this year (604 euro, +3.1%).

Shortage of supply

The main factor that caused rent prices to spike is the higher demand together with the limited number of properties on offer. “After many years of supply excess, we’re assisting now at a shortage of houses for rent”, explains Isabella Tulipano from the Solo Affitti research centre. According to the expert, short-term rentals, such as online platforms like Airbnb, have been a cause for this trend. Another factor is the increasing demand from young couples, professionals moving from other towns and people coming from a divorce or a separation. Expats too are mainly looking for rentals, postponing to the future the purchase of a property.

The rise of studio apartments

The report also shows that prices of studios have risen (+4.8%), along with one-bedroom apartments (+4.6%). This phenomenon mainly concerns city centres. Rents for two-bedroom apartments have followed the general trend (+3.2%), while bigger flats such as three-bedroom apartments have reported a more limited growth (+1.1%).

Isabella Tulipano says: “The increase of rent prices is meant to continue. We forecast that rents might exceed the pre-crisis levels in the next few years in big cities like Milan and Bologna. The other cities will join in two years”. This phenomenon is going in the opposite direction of the property market trend, where prices continue dropping, and they’re way far from the pre-crisis level. It means that families are postponing the purchase of a property and keep renting.

Looking at the map, Bologna and Milan are the fastest growing cities in Italy, with double-digit growth rates, respectively of 10.9% and 10.2%. Other big cities have also registered an above average growth: Rome (+7.7%), Venice (+6.1%), Florence (+5.1%) and Turin (+4%). Average rents have increased in Potenza (+8.2%), Ancona (+4.8%) Campobasso (+4.3%), Palermo (+4.1%), Catanzaro (+4.0%), Trento (+3.2%) and Aosta (+2.8%). After having recorded double-digits results, Genoa (-8.4%), Bari (-6.9%) and Cagliari (-3.8%) have registered a negative trend this year. Rents have also decreased in Trieste (-5.4%), while in Naples and Perugia (-0.3%) the figures are aligned with the previous year values.

Source: La Stampa

Translator: Cristina Ambrosi