Cheap Properties in Italy .... Beware of the SCAMS!
From €1 to a few thousand Euros ... sounds too good to be true. It just might be.
There’s no doubt, Italy has always captured the hearts of many around the world. A country steeped with history, fashion, great wine and rolling green hills.
It’s no wonder that when the offer came up for homes for just €1 … that’s correct only €1, many people thought it was a mistake. The offers went just as fast as they were announced, however there was a little more fine print beyond just shelling out that single coin. Firstly, the houses on offer weren’t in the best of condition; honestly they were complete ruins which needed a full renovation. As such, part of your €1 deal was an agreement to invest on average of €20,000 - €25,000 in renovation. And as expected, these properties weren’t in be best of locations, so hopes of getting a €1 home on the beach or in the center of Rome, Venice or Milan definitely won’t happen.
Despite the above offer being dismissed by many, Italy still ranks the lowest priced property in the world…. more specifically Abruzzo, Italy. Homes in this region are currently listed from as little as €2,000 and up from fixer-uppers to habitable homes under €15,000. We needed to take a look at this first hand and see what Abruzzo was truly offering and why at such low prices. Below is an outline of what to expect from these low cost properties listed for sale.
Precaution #1 Real Estate Scams Real estate agencies! Taking a few months to research the properties we’ve come across a number of SCAMS that many agencies use, especially if you’re a foreign citizen. “Window Boxing” … the agency Immobiliare Caserio has been caught with this on numerous occasions. They keep a few very low prices properties on their site to encourage queries from clients. Once an inquiry is made to view the property, you’re told that it’s no longer available. It turns out that they never have these properties or they’re actually no longer for sale and just there as bait. Better Property Italy took it a step further in making sure they didn’t go anywhere they didn’t feel like. After taking 2 flights and 2 trains to get into Pescara (Abruzzo), this agency which also claims to represent Abruzzo, told us we would also need to take another train, a bus AND stay at a B&B near to their office as they won’t drive to Pescara (the area they represent). Italy has treated these real estate agents quite nicely and possible why they’re so many of them with no official certification. The incentive they have is that they make an average MINIMUM of €3,600 in commission on any property under a certain amount. So even if you’re fortunate enough to find a €1,000 property, the commission alone will be minimum of €3,600 additional. Quite a stretch over the 3 - 5% of most other countries. Which brings us to …. Precaution #2 Fees & Taxes This is another big contentious item that must be checked carefully with any agency. All sales would include commission + notary (Italian version of a lawyer who with verify all necessary deeds & paperwork) + taxes (differs if you’ll be making this your primary or secondary residence) + power of attorney (if not there for the final closing) This final figure can vary significantly and especially with different agencies. ICXXX has been know to tap on a host of excessive extra taxes so beware! However you’re final figure could be in the vicinity of an additional €7,500 and up
Precaution #3 General Scams During an attempt to try and get some information on the property area, we were told but an individual the he know quite a few of the properties in the area and the owners. If interested he could get directly in contact and provide any necessary details as required. As time went on this trend out to be untrue as well, so be on the lookout for this type of activity. Other issue to keep an eye on would be inconsistencies with what is provided by the agents and what is listed online. One particular property was advertised on two site as including private and and a private terrace as part of the sale. This was also confirmed with the agent via email. During the site visit we were told that the land was “shared” and the terrace was also “shared”, both with the neighbor. This was questioned in another conversation at a later date, where the mention was made to previous emails. Once again, was told that the land is private but no explanation as to why there’ always a change in the information. Update: They now have the property listed with a “small vegetable garden”. Interesting how approximately 1000 sq ft of land now dwindled down to a vegetable garden. Other sites have it still listed as the full amount.
Earthquakes Italy unfortunately lies on a number of active fault lines make it very susceptible to frequent earthquakes. The latest most destining one was recoded in 2016 with an unfortunate high death tool. BBC Report
Many persons from that 2016 quake are still to this day picking up the pieces and trying to rebuild.
As this phenomena is an anticipated occurrence, currently no insurance agencies offer earthquake damage insurance in the country. So this is risk number 1 you must be willing to take.
Precaution #5 Ghost Villages As indicated we decided to take a look at one of these properties first hand to get an idea of what and why they’re so cheap. The property seen was in a small town call San Giovanni Lipioni; a quaint little village with amazing views and quiet atmosphere. As with most villages in the “low price market”, the majority of the younger generation (and some older) have left these parts for a better life in the major cities and within Europe. So what’s left now is a shell of what they once were. San Giovanni Lipioni is no exception. Having gone for a population of over 2,000 in the 80’s to now just under 160 it’s needles to say it’s becoming another ghost village. Some villages have fallen to a population below 50 and some full villages have also be reported to have been for sale a number of years ago.
With that said and such a small population there’s basically no one around. The village is home to one bar, one post office and a church. There’s no restaurant, no bakery, no grocery no butcher. Your nearest main city is approximately 1hr 30min by bus (which runs twice a day and the only bus serving the area). During the time there and a walk around the village we only saw the pleasant lady running the bar and one patron inside. All other houses were closed and numerous VENDI (for sale) signs strategically placed.
With a continued decreasing population, more more businesses will eventually leave the area along with basic services, public transportation and the list continues. San Giovanni Lipioni has seen such a decrease over the years with the closing of a grocery store, bakery and reduced bus service. An email to the mayor of the area also proved futile. Expect to be quite isolated in this area. Which brings up another important fact. Precaution #6 Emergency Services Being a small isolated village bring with it a feeling of safety where “everyone knows everyone”. However on the flip-side, you’ll be over 1 hour away from any other critical emergency services; ambulance, medical care, fire.
Precaution #7 Real Estate Value The investment of real estate is generally seen as that, an investment whereby if need be in the future you can sell and maybe make back a little money or in some cases quite a bit more. Don’t expect this outcome with a property purchase in the region. The property in question for the viewing originally had an asking price of €75,000. The dwindled its way down to €49,000 ….. €29,000 …… and currently €22,500. Property prices are continuing to fall as there’s less and less demand for persons interested in living in these remote villages. Subsequently, an investment of €10,00, €15,000 or whatever figure, doubled with a steadily decreasing population would mean a continued downward spiral on your property value and similar difficulty in selling such if need be. Vehicles depreciate as the years go by; real estate shouldn’t.
With that said, If you’re looking for a real bargain property then Abruzzo Italy is certainly the top spot. However if you’re interested in a secure financial investment AND not willing to be taken for a ride with the numerous real estate scams then you’ll definitely need to re-consider.
Other “secure” low-priced investment options include: Bansko, Bulgaria Price range: €9,000+ furnished studio / €12,000+ 1 bedroom No renovations required Pros: Top winter destination for skiing Visa Requirements: 3 months / not part of Schengen area Sunny Beach, Bulgaria Price range: €8,000+ furnished studio / €13,000+ 1 bedroom No renovations required Pros: Top summer destination. Beach & activities Visa Requirements: 3 months / not part of Schengen zone Batumi, Georgia Price range: €22,000+ furnished studio / €25,000+ 1 bedroom No renovations required
Pros: Rapidly developing city. Popular summer destination
Visa Requirements: 365 day visa free for most countries
Antalya, Turkey Price range: €15,000+ unfurnished 1 bedroom No renovations required
Pros: Popular summer destination. Low cost of living. One of the top 10 most visited cities in the world
Visa Requirements: 3 months / not part of Schengen zone
Pros: Top summer destination. Beach & activities. Many new high-rise apartments overlooking the sea Visa Requirements: 12 month visa free for most countries
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