Luxury villas and homes, sales increase in Italy

luxury house with pool

The luxury real estate market does not seem to have suffered from the crisis, indeed.

The analysis conducted by an indipendent observatory analyzed the sales of luxury real estate in Italy (here some examples of luxury homes and villas in Italy), recording an increase of 16% between 2011 and 2012.

You can buy real estate property and more throughout the boot and especially from abroad, particularly from Russia. Data that bode well for the industry in a time when other properties are still on the other hand if not in decline: Istat has photographed the real estate market in the same period that saw a decline in sales of 23.6%. Italy thus confirming land of beauty, able to attract foreign investors, attracted by the beauty of our country and the most exclusive houses.

The types of luxury homes in Italy ranging from ancient to modern, following the most beautiful routes in our country. The archaeological wonders, cultural and gastronomic traditions, natural beauty, ranging from the sea to the mountains, the reasons for living in Italy are many, especially for foreigners who have bought more prestigious properties between 2011 and 2012. The figure that emerges from the research speaks of buyers in the United States increased (+9%) and England (+3%). The most significant of these is Russia, which is an increase in double figures with a + 12% of searches on the portal, in particular from Moscow (+55%) and St. Petersburg (+30%).

Different types of luxury homes affecting buyers from Russia are wondering designer villas, while the British confirmed the charm of the Tuscan countryside (Chiantishire) or the cities of art, primarily Florence, Venice and Rome, while the U.S. recall Made in Italy remains the strongest.

Even the location vary according to the groups of buyers with a preference of Russian classics of Italian luxury in places like Lake Como, the fashion district of Milan and Sardinia, while the British link historic houses and castles of the Tuscan hills, the masserie or historic buildings in Venice, followed by the Americans who alternated historic farmhouses to villas and housing design.

Always the Russians are also distinguished by the greater purchasing power for luxury homes ranging from 10 thousand to 15 thousand euro per square meter, exceeding 15 thousand when it comes to villas in Costa Smeralda: the lower the average expenditure of British and American between the 8 thousand and 12 thousand euro per square meter.
 

Black numbers for housing market. Crisis!

Crisis make me cry

ITALY - Black for the housing market crisis, which also affects a small part of the demand for mortgages.

A enderlo known is the Fiaip Federation (estate agents referring to cercacasa.it) which publishes the data on the year 2012, emphasizing a reduction of 11, 98% of real estate prices and a reduction in the number of sales of 17.22% compared to 2011.

The effects of the economic crisis are also found from the analysis of a larger period, ie the five-year period 2008-2013 (according to the experts, the period of real economic crisis), where the only housing prices have fallen by 20-25 %, even the sales have been reduced by 40%. Compared to 2012, net also decrease the prices of rentals, from -5.6% of the locations for housing to -12.5% ​​of the leases for commercial use.

Fiaip appears slightly confident hope of a slow recovery in the second half of 2013 will persist if the conditions of political and economic stability. The real estate market of non-residential showed a decrease in the price of 14.89% for the shops, 15.27% for offices and of 15.04% for construction, with a decrease in sales which amounted on average around 20%.

43% of the trading is done with the use of mortgages and loans, but with a slight reduction in requests and disbursements compared to 2011. Among the cities, the gold medal for the decline in residential property prices in Perugia, the Umbrian capital is recording a peak of -17.13%; reverse speech to Taranto where property prices have fallen by "only" 2 %.

Italy - Black year for the housing market, house prices collapse: Rome -15%

Italy - Black year for the housing market

Fiaip: in contrast Taranto. For the first half of 2013 the market still

Rome, February 15 (TMNews) - Black Year, 2012, for the housing market: the sales fell by 17.2% and housing prices have fallen by 11, 9%. To provide the data is Fiaip (Italian Federation of Professional Real Estate Agents) which released the report on the progress of urban real estate market scenarios for 2012 and 2013.The 2012 "closes with a market stagnation in a context in which the indicators marked a decline in real estate prices in the residential and commercial real estate market," said the Federation. For the trades "there is an average trend of falling prices of '11.98% for houses, while falls the number of sales that amounted to -17.22% in 2012." Sharp decline, then the price for leases for housing and commercial leases -5.60% -12.5% ​​compared to 2011.

House prices fell throughout Italy in 2012 and even in big cities, with record declines in Perugia (-17.1%) but also in Rome (-15%) and Milan (-14.2%). From the 2012 report Fiaip there was a strong general decrease in all cities, "with the exception of Taranto who photographs a reality in contrast." The remaining reductions ranging between -5.75% -14.36% of Avellino and Palermo, passing between -8% of Florence - 8.43 of Venice, -11.11% of Salerno - 12% Genoa - 12.83 Udine, -12.86 of Siena - 13% of Naples - Bologna 13.74 - 13.75 Torino - 14% Cagliari.

"Although the market has discounted the beginning of the crisis to date, more than 40% decrease in the volume of trade and a decline in values ​​that on average amounted to about 25%, the brick - said the Fiaip - guaranteed Italy in a "holding" higher than other forms of investment, through the support of a "demand-established" that contained further declines preventing the occurrence of the explosion of so called "bubble".

Last year, property transactions fell to share 470mila. For the first half of 2013 the market is expected to remain firm: Potential buyers are discouraged and wait "at the" possible new sull'Imu of the next government and the arrival of better times. A benefit is, therefore, the rental market. For Fiaip "only the political and economic stability will enable the start of a slow recovery in the second half of 2013."

Where's the monopsony?

President Obama, Paul Krugman and Robert Reich have all been pushing for an increase in the minimum wage.  I want to agree with them, and Krugman is certainly correct that the preponderance of empirical evidence shows that the minimum wage's impact on total employment is negligible.

But the question is, why?  Krugman's statement that human beings are not Manhattan apartments is true, and allows him to support the minimum wage while being appropriately skeptical of rent control, but it doesn't give a satisfactory answer as to why putting a floor on the price of labor would not create excess supply of labor.

There is in economic theory a set of circumstances, however, under which an increase in the minimum wage might raise employment.  If an employer has a market largely to itself--if it has monopsony power--then it will both pay its workers less than their productivity warrants and not hire enough workers to be at the most efficient level of employment.  Raising the minimum wage would then both increase pay and induce more workers into the labor market, hence increasing employment.  If government could nail the minimum wage to the marginal revenue product of the least productive  workers, the minimum wage could produce a first-best outcome--one where pay and employment levels were efficient.

For the argument to work, the demand for labor needn't be perfectly monopsonistic, but rather less than perfectly competitive.  The fact that wages and labor productivity seem to have less and less to do with each other is evidence that the demand for labor is not competitive, but it would be nice to have further, detailed evidence of the industrial organization of labor demand.  

Should college be subsidized?

Mark Thoma has a very nice piece today about how Cal State-Chico changed his life.  One of the reasons it changed his life is that he could afford it--it cost $100 per semester when he went there.  The story is heartwarming, to say the least.

I have always struggled with how much college should be subsidized.  People who go to college almost certainly create positive externalities, and so Pigou would say there should be some subsidy.  But people who go to college also earn substantially more over their lifetimes than those who don't.  Low income people who pay state sales taxes thus subsidize high income people.  Hence the idea that people graduate with debt seems reasonable to me, because the value they get from college far exceeds what they need to invest in college, and it means they are reducing the tax burden of those who don't go to college [I should note that I was among the lucky people whose parents paid for college, so perhaps I am in no position to comment].  On the other hand, if high prices keep 18 year olds from going to college, one of the most important routes to social mobility is blocked.

In any event, a government economist friend of mine has the obvious solution to the problem of the regressive nature of subsidizing college: progressive taxes.  

Will smart phones be the end of built in automobile NAV systems?

Four years ago, my wife bought me car for my birthday.  She reasoned that as a newly minted Angeleno, I would be spending more time in my car than ever before (she was right), and so that I might tire of my slightly beat-up Corolla.

She got me a Honda Accord with all the trimmings, including a NAV device, which I enjoyed very much.  And four years later, I continue to love the car.  But I recently downloaded WAZE to my phone.  WAZE provides crowd-sourced information on traffic, and allows one to find the fastest route from place to place with remarkable dependability.  It provides turn by turn directions, but will change the directions on the fly when traffic conditions change, a regular feature of life in LA.

WAZE is, by the way, a free app.  It also takes us one small step closer to self-driving cars.  By guess is the built-in NAV system, as it currently exists, is a dinosaur.

Bankers and tail events

I participated in a panel last note hosted by the German American Business Association.  Overall, I had a nice time.

But before the panel, a managing director from a very large bank gave a speech, and he was trying to make some sort of point about tail risk.  The example he used is going to jail in Monopoly, an event for which the average probability is four percent.

Maybe I am being picky here, but two points.  One: four percent is not that far out on the tail.  I suppose it would be good if banks tried to avoid things that happen four percent of the time or less.  Two, and more important: random events in Monopoly come from a finite state space, so risk can be completely characterized.  We know with a great deal of certainly the probabilities of particular events happening in Monopoly.

Banks have to deal with uncertainty--random shocks that are not easily characterized by well defined distributions of outcomes.  The Monopoly metaphor is thus a bad one.