keyitaly.com’s blog

The absurdity of catch-all articles about the ‘Italian property market’, ‘Spanish property market’ or indeed ‘World property market’ was thrown into sharp relief for me this week as I trawled through the morning papers for property stories. Reading The Times (that’s ‘the Times of London’ for our American friends) I was informed as usual that the credit crunch, the increase in mortgage rates, the over-valuation and indeed over-supply of much property was going to lead to a fall in prices or, if you’ve been unlucky enough to buy in Spain in the last three years or so, a complete inability to sell your Costa dream home. The Times property section tells me that ‘In the northern Tuscan borders, you can still find property for less than £800,000’. Well indeed, and for around €750,000 less than that if you look even slightly off the well beaten path of ready modernised villas in the most expensive areas. I’d direct you to exhibit A, listings of some excellent properties for sale in Tuscany below €100,000 … admittedly properties with raw rather than realised potential

There are grains and whisps of truth whirling about here. Only a fool (or an estate agent) would deny that there are problems. Now is certainly not the best of times to sell, though it is conversely a very good time to buy property in Italy and elsewhere. Get the finance sorted out and you should be able to drive a good, hard bargain. But there is no single property market. So you’re probably okay if you bought a solid Tuscan barn, needing work, to which you can add value, at any point over the past few years. They are in finite supply, they have inherent quality and buyability and you can do building work which will add more in value than in costs to do. You’re probably not okay if you bought one of a new development of 500 apartments in a part of the world where nobody really wants to go on holiday or indeed to live (Bulgaria anyone).

My faith in the such pieces diminishes when I read stuff such as that in The Times. It assumes there is one market, whereas anyone who spends any time buying and selling and researching ANY area, will tell you there are dozens. My own experience of property in London is contrary to the headline story of giddy rises followed by a plummet in property prices from late 2007. In fact, the prices of most housing stock had stalled or slowed over the past three years – nothing wrong with that, as most investors would rather have sensible single digit growth each year rather than boom and bust. The areas that were racing were always going to fall again. It doesn’t take much research to find properties with potential, as evidenced by our Tuscany example here. Buy wisely, do the work, and watch your property grow in value.