The Situation of Real Estate Market
For some months Italian real estate market has been going through a crisis, not dramatic like US real estate crisis, but that it’s slowing down businesses and marking down real estate’s prices.
The number of families that decided to buy a house has fallen by approximately 0,5%, and families that bought one, considered the price as a the most important factor for their choice. Just as secondary factors they considered all other factors, such as location, comfort level, proximity to workplace, public transportation network or presence of many businesses in the neighborhood or if they have children, the presence of day nurseries or of other useful facilities. This happens because families need to spend less money and so they have to satisfy themselves with cheap houses even if not very comfortable.
Since last years the number of families not satisfied or not very satisfied of their houses is increasing from 10% in 2006 to 30% in 2008.
Regarding the supply of real estate properties, in the two year period of 2007-2008, just 1,6% of interviewee families sold out their house, 1,3% less than in 2006. Most families sold their house just to buy another house.
People sold a secondary house because they need money or in order to invest money in other real estate properties. Just 5% of interviewee families has decided to buy a house, but confronting this number with previous national surveys, also purchasing intentions are going down. There are two main reasons for this fall – aside from the price level reached in these last two years – these are the well-known economic difficulties of Italian families and the increasing of interest rates.
Estate prices are too high so Italian families don’t buy new houses. These are strong signals of crisis, confirmed by the severe decrease of business transactions that since 2006 are falling by 4,6% in the residential sector, the one that affects Italian families closely.
Real estate market of course highlighted a slowdown that in 2009 will go on, sector analysts foresee that estate prices will still decrease, also as a result of actual loan market, since banks and lending institutions are less and less disposed to make loan both at fixed or variable rate. Rates are lower, but loan are granted much less easily. Even immigrants are buying less, right as Italian temporary employees, they are also affected by the strict loan policy.
In the last months prices have been decreasing of about 20% and probably will decrease again of about 6%, just real first-class properties will limit the race to lower prices but they are really few.
Besides these numbers, other events will occur in the Italian real estate market, such as discount prices on big estates, the building of too many new houses in the small towns, increasing number of houses for rent.
Anyhow the fall of prices should help the recovery of real estate market. The demand, even if a bit decreasing, is still quite steady. Today, in a not very positive economic situation, real estate is still considered a very good investment by comparison with other economic sectors. You never have to forget that fluctuations always occur in the real estate market, low prices will encourage more families to buy a house, and this way businesses will slowly but certainly increase again, and sooner or later real estate market will recover and pass through this crisis.
By Michele De Capitani with support from software immobiliari for any information, please visit software franchising or visit applicazioni gestionali.
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Webwriter of Prima Posizione Srl.
Article Source: ArticlesBase.com - The Situation of Real Estate Market