Venice: is the sinking city a rising market for homebuyers?

16 Mar 2016, Lucy Racheva   Read the original article

For centuries, Venice fascinates foreigners with its exquisite palaces, towering over the emerald waters of the contorted alleyways.

To buy prime property on the Grand Canal used to be an unattainable dream for any home-buyer, so far, as Italian families traditionally transfer their property ownership from generation to generation.

Today, however, the situation has been changed and historic homes overlooking the central part of Venice are coming on to the market.

The economic crisis between 2008 - 2014 put the Italian sentiment aside and pushed them to sell off the family heritage.

In 2008 there was only one property available on the Grand Canal. You had to queue up to have a chance to buy it. Today, similar properties are over 50, said a representative of one of the leading Venetian companies for prestige properties.

Unlike the older generation Italians, who are used to keep the "second" and "third" home, young people, who often live and work abroad, think otherwise: "What is the point to keep property if you do not use it?".

Property prices in Venice have fallen 30% since 2009, according to data from a local research companies of the real estate market. There are remarkable discounts available, with 10m palazzi now being sold for 6m to 7m.

In 2015 inquiries for property in Venice increased by 20%. Most buyers are from Britain and France.

Of course, buying a property in Venice has its challenges related to problems caused by water and weather.

Accordingly there are high maintenance fees, for example to prevent damp (expect to pay an average of about 40 per sq metre every 18 months) and flooding (reinforced concrete tanking in the basement costs 300 to 500 per sq metre).

A palazzo in Venice is a piece of art, like a Picasso painting. There is a limited number and no new buildings are being built. So you cant compare it to Milan or Miami. It will always be of high value.

It is said that people buy in Venice, because they have a love affair with the city and for them there every day is an adventure.

Venice, considered one of the most beautiful cities in the world, has always been in danger of becoming a victim of its own success.

Nevertheless, the carnival in Venice may not be over yet. The city remains one of the most desired destinations not only for tourists but also for new wealthy residents.

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