A view from Lucca
Although Northern Italy was hit hard by Covid-19, markets such as Lucca are displaying some resilience with enquiries from German buyers notably higher
3 minutes to read
I spoke to Alessandro Deghè (AD), CEO of Serimm Real Estate, Knight Frank’s partner in Lucca to understand how the prime property market there has been affected by the crisis.
What impact has Covid-19 had in Italy?
AD: We were the first European country to go into lockdown on 9 March 2020 with the northern states of Lombardy, Piedmonte, Emilia-Romagna and Veneto seeing the largest number of cases but Lucca by comparison had very few.
The measures imposed were among the most stringent in Europe. However, from 14 April some concessions were made with stationery shops, bookshops and children clothing shops allowed to open. Since this time, we have seen a gradual easing of measures although schools remain closed.
What support has the Italian government provided to households and businesses?
AD: Much like the UK, the government has offered a furloughing scheme allowing employees to receive 80% of their salary taking the pressure off businesses and protecting employment at least in the short term.
The Italian government is also finalising a further package worth €55 billion to support the country's economy.
What service can property agents currently deliver?
AD: During lockdown notaries remained open and the Lucca office completed two deals. Our office reopened on 4 May, on this date viewings of unoccupied homes were permitted, but on 18 May agents we should be able to carry out all viewings as normal in line with social distancing rules.
Presumably all enquiries halted during lockdown?
AD: The first two weeks of lockdown were very quiet but after Easter we saw a spike in online viewings and our social media engagement surged. International visits to our website increased 30% between January and April. This occurred across all price brackets and buyer types, both local and international. Without doubt, some of this traffic will be those daydreaming during lockdown but the fact that the online activity has been backed up with telephone enquiries and we have seen clients engage once we provide property details suggests there is a genuine commitment from a number of enquirers.
We had seven deals on the table prior to lockdown and only one fell through, the other buyers if anything are more keen to progress with two already exchanging.
The data below shows online viewings of Italian homes via Knight Frank’s website with a notable uptick observed since the start of May.
What is motivating buyers currently?
AD: In my view its emotionally-driven. One of my buyers who has had more time to spend with his family during lockdown is even more convinced of the need for an Italian home to complement his lifestyle and family’s enjoyment. Most of my purchasers are second home buyers seeking a long-term asset for lifestyle purposes, they’re not buying purely for investment purposes.
Have you noticed any new trends since the start of the crisis?
AD: German interest has strengthened significantly. Usually, only 12% of our buyers originate from Germany but in the last two weeks this has increased to 39%. The remaining enquiries are from the Netherlands (21%) UK (19%) and USA (15%) with the remaining 6% from a mix of countries.
What is the outlook for Lucca’s prime property market?
AD: In my view once travel restrictions are relaxed we will see a flurry of activity as buyers are eager to move on and expand their living space, how long this lasts will depend on the broader economic ramifications and consumer sentiment.
Low interest rates, the lifestyle and the Italian flat tax will continue to appeal to HNWIs globally but particularly to those from northern European economies.
View properties in Lucca