“The first months of 2016 have shown signs of recovery, which, although still weak, are no longer confined to the residential sector alone, but have also invested real estate for businesses". This is what emerges from the Observatory on the Real Estate Market in July edited by Nomisma and presented on Wednesday in Milan.
“The comforting signs of recovery on the sales front – the study points out – could however be annulled in the coming six months by a continental framework characterized by the progressive weakening of growth prospects, with the unexpected result of the Brexit referendum which represents a formidable trigger for a new phase of uncertainty and instability which contributes to attenuate an optimism that seemed to resurface after more than 8 years of recession”.
On the side of mortgages, Nomisma predicts that, “faced with the easing of credit institutions' supply criteria, low interest rates and a demand that is confirmed to be expanding, the market will deliver us a slow process of expansion, with a gradual recovery, albeit incomplete compared to the pre-crisis years. However, a limited downward revision of disbursements could emerge in the second half of 2, to then resume the expansion path in the years 3-2016”.
In the retail real estate market, the most striking signals come from the buying and selling of homes (+3,6% in 2014, +6,5% in 2015). The first three months of 2016 saw generalized growth in all sectors, with an increase of +17,3% compared to the same period of the previous year. Specifically +20,6% for the sector residential and +14,5% for that commercial, while the tertiary presents a weak +1,3%. Nine years after the beginning of the crisis, the market for sales in 13 major Italian cities presents a downsizing of 40% in the residential segment and 50% of buildings for businesses.
It is noticeable in the segment offices a new slowdown in the markets of Milano e Roma, while cities such as GenoVa, Napoli e Bologna show a moderately positive trend.
Moving on to consider housing rental contracts, in 2015 a figure of just over one million was subscribed, of which only 22% attributable to "high voltage residential" municipalities. The prevailing typology is that of long-term rentals (60%), while transitional contracts account for 18% and leases with agreed rent at 20%. Only 2,2% is represented by subsidized rents for students. The Nomisma study shows how rent-free leasing – in the set of the 13 main markets monitored – is gaining share to the detriment of free-rent leasing.
In the last semester the deadlines for the conclusion of the negotiations they generally declined, with a consolidated improvement for homes against a weaker decline for offices and shops.
As regards the discount applied, the gap has shown – for the third consecutive year – a reduction, even though it still stands at values well above (by more than 6 percentage points) compared to pre-crisis levels.
In the first half of 2016 the annual trend change in prices it is still positioned in negative territory, with a variation that oscillates from -1,8% of new homes to -2,5% of offices.
Nomisma points out how the recovery of the home buying and selling market hard to propagate to prices, thus calling into question the historical evidence which identifies the delay with which market values react to the increase in trading as about two years.
The returns of a investment in the real estate sector, according to the Institute's indications, they are between 5% of homes and offices and 7% of shops.
The photograph offered by Nomisma reproduces an Italian family whose attitude is essentially sticky in spending decisions and whose reflection is a tendential prudence and a banking sector more inclined to favor subrogation or replacement operations than to bet on the repayment capacity of large share of potential demand.
Even in a context of attention to the quality of loans, in the first part of 2016 the gradual easing of the criteria for lending to businesses and households. In this regard, consider how in April 2016 the average rate on transactions with a duration of more than 10 years reached 2,63%, against 2,22% in the Eurozone, with a rather modest spread (41bp) compared to that recorded in August 2013 (162bps).
Overall, the loan granted to households for the purchase of homes, including subrogation and replacement operations, reached a volume of 2015 billion in 41,2 against 24,1 in 2014. The growth in disbursements showed, in particular, an accentuation in the fourth quarter with a volume disbursed of over 13 billion. The growth rate of disbursements reached 70,6% in 2015, and then decreased only marginally in the first quarter of 2016, reaching around 55%.
It should be remembered that in 2015 and in the first part of the current year, the sharp increase in the amounts disbursed was affected by the already mentioned substantial component of subrogation and substitution. According to Nomisma estimates, this dynamic has played a crucial role in the growth of disbursements in the last two years, going from 7,5% in 2014 to 28,4% in 2015 and to 28% in 2016.
In the light of the results of the latest survey, 852.000 families make up the demand for the purchase of homes, of which 395.000 are looking for a mortgage, with a projection in terms of loans of just under 47 billion euro.
From what can be deduced from the Observatory, there are over 53.000 families intending to turn on renovation loan of the main house in the next 12 months, while over 1,8 million families do not rule out taking action in the future.
