The interviews for the Italian Housing Market Survey were carried out between 26 September and 22 October. A total of 1,395 estate agents took part. Information was provided on house sales, rentals and prices in the reference quarter (July-September 2014) and on the outlook for the future.
Main findings
House prices
The balance between agents reporting increases and decreases in selling prices remained broadly unchanged in the third quarter of 2014 (-65.3 percentage points, compared with -66.4 points in the second quarter). The trend in the single components was quite various, however: in urban areas the negative balance narrowed significantly (from -70.6 to -65.2 points), while in non-urban areas it widened from -63.6 to -66.3 points). In metropolitan areas it improved from -70.9 to -61.7 points, while in non-metropolitan areas it worsened from -64.5 to -66.7 points. The proportion of respondents judging prices to be stable was practically unchanged at 33.3 per cent (32.5 per cent in July).
Sales
The share of estate agents who sold at least one property in the third quarter of 2014 was 64.4 per cent, down from 68.1 per cent in the second quarter. The decrease during the summer months was significantly affected by seasonal factors; in fact, by comparison with the third quarter of 2013 (59.8 per cent) there was an improvement. Assessments of demand conditions, instead, worsened marginally: the negative balance between reports of an increase and reports of a decrease in the number of potential house buyers slightly increased to -22.7 percentage points from -20.5 in the second quarter.
Mandates to sell
The balance between replies indicating an increase and those reporting a decrease in current mandates was unchanged at 28.4 percentage points, while the balance in reference to new mandates edged upward to from 18.1 to 19.7 points. The main reason for the cancellation of mandates continued to be the gap between asking and offer prices. However, the share of agencies reporting that selling prices were considered too high came down from 62.4 to 58.0 per cent, and those saying offers were considered too low also diminished, from 55.1 to 52.9 per cent. The percentage attributing the loss of mandates to problems in getting a mortgage turned back up, from 34.2 to 37.3 per cent.
Negotiations and selling times
The average margin for reductions on the selling price in relation to the seller’s initial asking price held basically unchanged at 16.1 per cent. The time between the start of the mandate to sell and the sale of the property was also practically the same at 9.5 months.
Financing
The share of house purchases financed by a mortgage loan fell from 62.9 per cent in the second to 59.9 per cent in the third. At the same time the loan-to-value ratio for properties declined from 62.1 to 59.3 per cent. Both these developments reverse a year-long upward trend.
Rentals
Overall, 83.7 cent of agencies reported that they had rented out at least one property in the third quarter of 2014; it was practically unchanged from 81.2 per cent a year earlier. The percentage of agents reporting a decline in rents fell from 57.7 per cent in the July survey to 52.6 per cent, while those who declared rents were stable rose from 39.9 to 45.3 per cent. Much as in the previous survey, 61.8 per cent expected that rents would hold stable over the next quarter, while 37.1 per cent expected them to decline. The average margin for reductions on rental prices compared with the initial asking prices continued to be about 7.5 per cent. New mandates to let were reported to be stable by 59.0 per cent of agents, while the balance between replies indicating an increase and those reporting a decrease was still barely positive at 0.8 percentage points.
Outlook for the agents’ own markets
Agents’ assessments of the short-term trends for their own reference markets were less pessimistic: the negative balance between positive and negative assessments lessened from -26.9 to -20.4 percentage points. The balance between expectations of a rise and a decline in new mandates turned back up to 16 percentage points after falling to 4.2 points in the summer survey, presumably because of seasonal factors. In any case, the percentage of agents predicting a fall in prices increased again, from 55.8 to 61.2 per cent, while the share expecting stability slipped from 43.6 to 38.4 per cent.
Outlook for the national housing market
The negative balance between expectations of short-term improvement and deterioration in the national housing market remained practically stable at -33.7 percentage points. Over the medium term (two years), however, the balance between favourable and unfavourable judgments worsened for the second consecutive quarter, turning negative by 3.9 percentage points (in the previous survey it had been positive by 5.4 points). The share of respondents expecting unchanging market conditions rose from 34.8 to 37.7 per cent.
