COVID pandemic impact on the Italian property market
If you own property in Italy or you are planning to buy one, you may be wondering how the COVID-19 pandemic has impacted the real estate market in Italy.
Unfortunately, many people have lost their jobs or have had to halt professional activities during the pandemic. You might think that this will force property prices down so it would be a good time to invest in real estate in Italy.
Is that true?
Will the COVID pandemic negatively impact the Italian real estate market?
This is not an easy question to answer. Because Italian real estate agencies have only recently restarted their activities, it is too early to evaluate price fluctuations.
Generally speaking, no matter the cause of a crisis, properties sell at lower prices if owners need cash in the short term. However, if owners don’t need of cash, it is unlikely that they will sell at lower prices to achieve a quick sale.
How will COVID effect Italian house prices?
In order to understand the impact of COVID on Italian house prices, there is an important cultural aspect to consider. For Italians, investing in the property market and has always been seen as a secure investment. In any period of crisis, property safe havens become even more relevant.
In light of the above, it is hard to say how the pandemic will actually impact Italian property prices. It is difficult to predict whether property prices in Italy will drop or remain substantially the same.
What about pre-pandemic property contracts?
The scenario might be slightly different for property purchase negotiations started prior to the pandemic.
If you signed a contract to purchase an Italian property but the pandemic caused a delay in completion, it is unlikely that your situation has changed. Once it is possible, your transaction will complete according to the terms and conditions of your contract.
In other cases, you may be able to claim a force majeure applies due to the pandemic. It depends on the specific circumstances. For example, the exact fulfilment of the contract, payment timing, breach of contract claims, etc.
If you would like more information about how to price an offer for an Italian property or, if you need advice on the impact of the pandemic on a property contract, please get in touch.