The Italian property market is set to continue to be slower in 2014 as prices are predicted to fall yet again, according to the latest reports emerging from the struggling nation. A weak domestic economic situation is the most likely cause for the weakness that looks like it will become inherent in the market, experts say, with the aftermath of the eurozone crisis leaving the nation in a state of economic hangover and reducing the levels of confidence in evidence in the property market.
Prices have fallen in real terms by nearly six per cent since 2012, according to the latest figures from Nomisma , and it says this is a situation that is only likely to be exacerbated further still this year. Lower sales numbers, which have contracted by eight per cent in the last year thanks to dwindling demand and a lower degree of confidence in the property sector, will continue to be an issue this year.
Italian properties have previously suffered from what is known as a 'hated' array of property taxes, and with the government having announced in January that it plans to retain these, it is probably little surprise that negative sentiment remains an issue. When this is paired with very slow economic recovery in the country - at the end of 2013 the nation came out of recession, but only just - it is easy to see where the issues still lie for Italian properties.
" The private sector entered the crisis with a healthy balance sheet, although the rising unemployment and the tight credit conditions are still potential threats and individuals’ purchasing power is weighed down by still tight credit conditions as well as fiscal headwinds, " a report from Fitch Ratings said. The company added that with negative economic outlook and a continued low confidence financially for Italian nationals, it predicts house prices sitting at around four per cent lower by the end of this year. Employment worries and no increase real wages will mean that fewer Italians are trying to buy homes.