Why do people pay unbelievable amounts of money for historic villas instead of buying a brand-new property with all modern comforts?
As a matter of fact, brand-new properties may not be available everywhere. In the most prestigious regions of Italy new construction projects are either banned or heavily restricted. For example, one would be hard pressed to imagine that the authorities would allow new housing projects along the shores of such strikingly beautiful, protected lakes of Lombardy (Northern Italy), as Como, Lago Maggiore, or Garda. And new developments on a scale comparable to the Russian dacha construction spree would be even less conceivable. So, all too often the only way to get the coveted address in a prestigious place is to buy a house with history in a well-established area. One should also keep in mind that striking a good deal with the Italian sellers would be quite a challenge since they are fairly choosy about their prospective buyers.
What regions of Italy offer the best return from the investors’ standpoint?
As a rule, the most profitable and secure investment is an investment in the top-notch and unique assets. Palazzo Estate’s experience shows that the crisis has barely left a dent on the real estate prices in Italy’s most prestigious regions. Villas and houses around the lakes of Lombardy where real estate enjoys invariably strong demand even in the most challenging times is a good case in point. But real estate on Como, Maggiore and Garda lakes is quite expensive. So, prospective buyers with smaller budgets can take a look at new projects in the developing regions. For example, two-room apartments in a brand-new building in the southern region of Calabria that borders Sicily can be bought for around €100,000. For this amount of money one can become the owner of a well finished apartment. Even with a sea view. Investments in the developing regions are riskier and more susceptible to price fluctuations in the volatile real estate market, but, on the other hand, they can generate surprisingly high return.
How risky is it in Palazzo Estate’s opinion to buy new real estate in Italy at the construction phase? How often do construction projects get delayed or miss the completion deadline?
Buying a new housing development in Italy is, of course, much safer than in Russia. According to the Italian law, the developer is obligated to furnish the would-be buyer with bank guarantees for the entire amount of money paid by him. Purchase transaction must be registered with the public notary. On top of that, before committing to a real estate property, the buyer may request the developer to produce a construction permit issued by the local municipal authorities. All in all, the whole process of buying a brand-new real estate property in Italy is well hedged against any abuses. As regards missed commissioning deadlines, things like that can happen even in Italy. But the agreement can be drafted against this eventuality to provide for financial penalties for delays and in this case the buyer’s wait will be rewarded.
Can a Russian buyer secure mortgage financing from a local bank?
Yes, a mortgage option is quite feasible. Several Italian banks offer home loans to Russian customers. Usually, it requires income statements for the past two years and copies of a labor contract. Documents should translated into the Italian language and certified by the Italian lawyers. Palazzo Estate has successfully assisted its customers with obtaining mortgage finance in Italy. So, if you have a solid set of documents, it is quite possible.
There are modern residential developments being built in Southern Italy, but prices are still noticeably lower than in the north. What is the situation there and are there any reasons to expect strong price growth there?
True, some experts believe that real estate in Southern Italy is undervalued today. It is no surprise that it is being snapped up not only by foreigners but also by the Italians themselves. Apulia, Sicily, Calabria are the regions that merit the closest attention on the part of potential investors.
Where in Italy can one buy the most expensive and premium real estate?
Super expensive real estate properties are available for sale, for example, on the coast of Liguria, in Tuscany, and on Sardinia. The most up-market areas of Lombardy and Piedmont are found around Lake Como and Lake Maggiore. Villas and other premium-class real estate on the lakes can go for millions and, in some cases, dozens of millions of Euros.
Upscale areas for downhill skiing aficionados are considered the resorts of Veneto and Valle d’Aosta. High living standards and natural beauty bring elite property buyers to Tuscany and Umbria. Generally speaking, many regions of Italy have their own up-market areas.
If one were to buy not a renovated building, but a real historic one (for instance, an ancient castle), what difficulties should one brace himself for?
Most of historic buildings (real ancient palazzos, castles and epoch villas) are protected by the Ministry for Cultural Heritage and the Environment (as per Act N 1089 as of 01/06/1939). While mulling a potential purchase, one should bear in mind though that the Ministry has the preferential right to buy any buildings of historic value. For this reason, the prospective buyer should first secure the Ministry’s official waiver of its priority right which can be granted within 2 months since the submission of the application. Should it come to a purchase, the new owner would be entitled to a palpable reduction of the registration tax – it will be 6% of the property’s cadastral value instead of usual 10%. On top of that, the cadastral value of historic buildings is not high and the annual property tax on them is lower compared to modern real estate properties. So, at the end of the day, advantages associated with purchasing historic buildings may well outweigh the hassles of securing all necessary paperwork at the preliminary stage.
Usual dilemma: we very much like the look of historic villas, but would like to have the most modern amenities and more hi-tech interior design. “Renovation” is out of the question. What advice can you give us?
In this case, you might want to try to find a renovated villa that suits your tastes. This will be just the combination of an ancient façade and modern interior design. This option is quite popular. Alternatively, it is worthwhile to consider buying posh apartments in the contemporary style situated on the premises of a historic villa (epoch villa). Another interesting option to think about is buying apartments in a renovated castle.
Why is Como nick-named the “lake of celebrities” or “VIP lake”?
Lake Como, one of the most posh areas in Northern Italy, has long been a playground for the rich and famous. But interest in this area really surged a few years ago when George Clooney bought a villa on the lake. He could not do it at the first try. Clooney lad his eye on this place back in 2002, but as he started looking for a luxury property he found out that nobody was selling anything he liked. But soon chance had it that one US billionaire decided to put the historic Villa Oleandra up for sale at the Sotheby’s and Clooney intercepted it. The movie-actor preserved the 19th century interior and spends several months a year in the atmosphere of a completely different epoch. It is rumored that in the year when Clooney bought his villa (at the price of $7.5 million), real estate prices on Lake Como doubled. Nowadays, one can buy a very interesting property at this price, but the most premium real estate available on Lake Como can go for over €30 million.
How should one choose a historic building in a smart way? What should one primarily focus on?
The value of a historic building in many respects rests on the traditional criteria for property valuation. It is important that the place comes with a view so that you, for instance, can see a lake from the window. It is also important that there is no railway line passing near the property, that the building and its infrastructure are in a good shape. Of course, the potential buyer should also find out about the provenance of the place, its documented history that is usually kept in the corresponding commune’s archives.