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 by Tecnocasa which presented the annual report for 2023 and forecasts for 2024.
In 2023, sales of residential properties in Florence fell by 15% compared to 2022 (-10% the national figure) while mortgages fell by -30% (-15% the Italian average) due to the high interest rates which caused the the amount to be repaid to the bank for a loan of 130 thousand euros in thirty years is 67 thousand euros, with the monthly installment going from 546 to 775 euros.
30% of purchases for investment
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 do not drop as they do in other big cities Italians, 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: we buy apartments to be used for short-term tourist rentals.”
The phenomenon of short-term tourist rentals has now abounded “overflowed” from the historic center, reaching the point of interest areas such as Campo di Marte, Le Cure, San Jacopino, Statuto, Gavinana.
Rents too expensive
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 a 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.”
Who can find, pays on average 1200 euros per month for a two-room apartment.
And according to Tecnocasa estimates, in 2024 rents will increase further.
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.
