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Turin 2018: the return of real estate. But only residential is doing well

13 January, La Stampa

Real estate is awakening. The 2018 outlook for the property market is of a cautious optimism: “The turning point – explain Nomisma’s researchers – is getting closer”. It is, however, a two-speed recovery: “The operators’ forecasts for the first months of 2018 see the strong consolidation of the recovery in the housing sector, with a good sales dynamic and an increase in values. Less optimistic is the vision of the trend of non-residential sectors”. Also in this case, however, at least according to the research department of Tecnocasa, which elaborated the data provided by Revenue Agency, the situation is not homogeneous. Turin is the main driver of the market, while it’s expected a possible decrease in prices in the hinterland and in other provincial capitals, although in Alessandria and Novara, during the first half of 2017, sales increased compared to the same period of 2016: more than 19% and more than 17%, while Asti registered a sharp decline (-14.2%). Fewer sales were registered also in Vercelli (-7.1%), while in Biella the trend is positive (2.2%). Cuneo and Verbania are stable.

Rents increasing

The researchers who developed the Nomisma third 2017 Real Estate Observatory have highlighted how during the second half of last year the Turin residential market recorded encouraging signals, particularly in the rental market. From their point of view, ” the analysis of the sale and lease values shows the proximity to a turning point for the residential real estate market”. Concerning prices of new buildings, there are positive variations, except for the semi-centre (-0.8%) and the minimum rents in the suburbs (-1.8%). Concerning leasing contracts, the recovery has started consolidating through a progressive increase in rental fees (+0.3% on average).

Business and services

According to Nomisma, the second half of 2017, the Turin office market was in bad shape due to a very weak demand, despite the huge supply on the market. The tertiary periphery is the one that registers the largest decline in prices (-1.9% on a half-yearly base and -3% on a yearly base). The commercial sector does better, registering signs of stabilization although in a general context of weakness. Prices decreased in the region by -0.8% over the second semester of 2017. During 2017, the warehouses market didn’t show signs of improvement. Considering prices, these dropped further, although less dramatically than in 2016. The average fees amount to 43€/Sq m for the old properties and 59 €/Sq for the new ones.

Possible solutions

Antonio Mattio, president of the Developers Committee, highlights what from his point of view is the problem the sector is suffering from, namely “the heavy taxation and the other charges that penalize new constructions”. In addition, when faced with the threat of an unsold property, “there are people who even give up making a profit”. Without forgetting that tax reliefs have made house renovations more convenient. According to Mattio, there is the risk of “penalizing urban regeneration projects in the city”. This is the reason why it is necessary “to think locally in order to promote these interventions from a tax point of view. For instance, by lowering the land conversion costs”.

Source: La Stampa

Translator: Cristina Ambrosi

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