The one just concluded was an interim week for the financial markets, and also for the real estate sector more specifically. In recent days, macroeconomic data have been released which are not very significant for the path of interest rates (which influence the real estate market) and attention is then turned to European Central Bank monetary policy meeting on 17 October. Expectations are for a new cut in the cost of money, also in this case of 25 basis points, earlier than expected a month ago; However, statements by some Council members – including President Christine Lagarde and French central bank head Francois Villeroy de Galhau – have strengthened this assumption.
Looking at Italy, some political controversies have emerged in recent days over a potential increase in home taxesespecially for those who have used construction bonuses in recent years. In reality, the government does not want to introduce a new tax for those who have benefited from the Superbonus, but enforce the provisions which oblige property owners who have benefited from the building bonus to update the land registry data. This could bring “resources to the benefit of the municipalities”, as the Minister of Economy and Finance Giancarlo Giorgetti said, because if the cadastral income of a property changes, the value of the IMU can increase.
The performance of the sector on the stock exchange
The real estate sector experienced a weak week at European level, with the index Stoxx 600 Real Estate which signaled -0.6% on a weekly basis.
A better performance was achieved by Italy, where the index FTSE Italia All Share Real Estate it gained 0.7% on a weekly basis, however under-performing the FTSE MIB index which closed the week with an increase of 2.8%.
Real estate securities listed in Milan
Among the real estate companies listed on Piazza Affari, there was a week positive for IGD (+1.8%). Little moves Next King and Recovery. The worse performances, however, are those of Aedes (-17%). Negative and Brioschi (-3%) and Gabetti (-2%). Smaller drops for Abitare In (-1%). No relevant communications from companies listed on the Italian Stock Exchange this week.
Macroeconomic data
Last week they also decreased mortgage applications in the United States. According to what was announced by the Mortgage Bankers Associations (MBA), the index which measures the volume of mortgage loan applications recorded a decrease of 5.1%, after -1.3% in the previous week, with the relative index requests for refinancing dropped by as much as 9.3%; the increase in rates on thirty-year mortgages to 6.36% from 6.14% the previous week weighs heavily.
Sector studies
The Italian real estate market continues to offer attractive returns for investorsaccording to the latest data from idealista, which show generalized growth in the third quarter of the year. The residential sector remains at high levels, with an average return of 9.3%, up compared to 8.8% last year (stable compared to 3 months ago). This figure, more than double compared to 10-year government bonds (3.5%), demonstrates the attractiveness of the brick compared to other forms of investment.
According to the study, which correlates the sales and rental prices of various types of properties to calculate their gross profitability, the commercial premises (shops) are confirmed as the most profitable real estate investment in Italy, with a gross profitability of 12%, stable compared to a year ago. This is followed by offices, which recorded an increase of 0.7%, reaching 10.3%. Garages also saw strong growth, going from 7.6% to 8.2%, despite remaining the least profitable category for investors.
