Decline in sales, stable prices and houses for rent that are now literally unobtainable even outside the historic center. The picture of the real estate trend in Florence was traced yesterday by Tecnocasa which presented the annual report for 2023 and the forecasts for 2024. In 2023, sales of residential properties in Florence fell by 15% compared to 2022 (-10 % the national figure) while mortgages were -30% (-15% the Italian average) due to the high interest rates which increased the bill of how much to repay to the bank for a 130 thousand euro mortgage in thirty years, with the monthly payment going from 546 to 775 euros.
Italians looking for a house are at the window, waiting for the ECB to start cutting the cost of money. The purchases are conducted by investors and immigrants who need their first home: Asians, South Americans, North Africans. In 2023, Italian buyers, who historically represented 50% of the total, fell by 12%. However, as Tommaso Birignani of Tecnocasa explained, prices in Florence are not falling as happens in other large Italian cities, indeed in the second half of 2023 there was a slight average increase of 0.6% which rises to over 3% in the city centre: «This is due to the major infrastructural redevelopment underway with the completion of the tram system and the fact that 30% of purchases are made for investment: apartments are purchased to be used for short-term tourist rentals».
The phenomenon of short-term tourist rentals has now largely “overflowed” from the historic centre, reaching areas such as Campo di Marte, Le Cure, San Jacopino, Statuto, Gavinana. A “normal” rental with a 4+4 contract is now impossible to find: “Our network of agencies receives thousands of phone calls a month, but we are unable to give answers – said Birignani – up to 10 years we stipulated on average 4 rental contracts per month, today we do 5 a year. Several workers give up the jobs they found in Florence because they cannot find a home. Rental properties not intended for tourism meet the demand of foreign students, mostly Americans, who have returned to pre-Covid levels.”
Those who manage to find pay on average 1200 euros per month for a two-room apartment. And according to Tecnocasa estimates, rents will grow further in 2024. Sales are expected to decline but prices will remain stable with further increases for quality properties and in areas affected by overall redevelopment interventions, such as San Marco.
In the San Lorenzo and Sant’Orsola area, shop rentals are also recovering, pending the restyling of the neighborhood. Outside this area and the historic center, however, neighborhood shops are put up for sale (there are currently over 1300 on the market): shops inherited, no longer profitable because they are outside the tourist circuits, which are burdened by IMU and taxes, impossible to transform into parking spaces or homes.
Tags: Airbnb effect unobtainable rentals Florence buy investment
