New economic measure allows property to be sold in bonds

Italy's economy ministry will be able to sell state real estate assets in exchange for government bonds to clarify and expedite the euro zone's third-largest economy out of a debt crisis.

According to Dowjones newswires reports, the government’s growth plan which is due to be approved as part of the 2012 budget bill is set to offer some respite to Italian banks, whose large holdings of Italian government bonds has caused them to suffer from regulatory and market concerns. The maxi-amendment presented by Economy Minister Giulio Tremonti to the Senate Budget Committee stated that the ministry will be authorized to sell public property to special-purpose vehicles or other buyers.

A senior government official said that the amendment allows the ministry "to accept government bonds as compensation for the sales" which will create an opportunity for Italian banks.

As a key regulatory measure for solvency, Italian banks hold Buoni Del Tesoro Poliennali, or BTPs, equivalent to more than 150% of their core Tier 1 capital. New European rules need banks to cut rate the market value of their BTPs and at a time when liquidity in Italian financial markets is scarce this makes them to raise more than EUR14 billion in fresh capitals. In exchange for property, Banks could offer some of their BTPs back to the government which is likely to be leased back by the government. Banks could securitize those properties into covered bonds eligible as collateral at the European Central Bank, backed by the cash flow from the lease contracts. In the past efforts to sell some real-estate assets have struggled for lack of bidders, however the new measure also solves a problem for the Italian Treasury.

Meanwhile, President Giorgio Napolitano's called for "immediate efforts" to put Italy's public finances in a safer condition. Yields on Italian government bond yields surged to record highs with the 10-year yield now at 7.35% and even two-year bonds now yielding 6.5 percentage points more than similar German paper. There is also increasing calls for the government to carry out a massive funding drive through swift privatizations or a one-time wealth tax, to tap Italy's substantial household wealth to reduce the country's huge debt pile and shore up its economy.

Liguria Homes- the perfect Italian getaway

Liguria may be about to rise up as a property hotspot for those investing in Italy. The increased interest in the region may signal a trend of overseas investors moving away from major cities and preferring to purchase homes in smaller villages, it has been suggested.

According to entrepreneur Martin De Rosa, Demand for homes in Liguria, Umbria and Tuscany is reaching an all time high among foreign buyers. The competition for Ligurian properties is increasing prices up, and luring homeowners who will spare no expense in finding the perfect Italian getaway. He stated that Germans spend an average of 300,000 Euros and Russian buyers are willing to put down over 900,000 for the perfect Ligurian home. British property buyers in Italy have become increasingly involved in Liguria in the past couple of years as76% of British buyers look at buildings in the 300,000 to 500,000 euro price range.

The Italymag.com website has reported that the thriving market is attracting buyers who are willing to pay up to 17,000 Euro a square meter for properties in Ligurian towns like Santa Margherita Ligure. A recent study of the number of adverts for properties by Italymag.co.uk found that there were more for Liguria than any other part of the country, Country Life reported.

In addition to this, the Italian region offers other outstanding attractions and achieved a record number of Blue Flag beaches in 2011. Blue flags were awarded to Camporosso, Bordighera ,  Albissola Marina, Albisola Superiore, Ligure, Loano, Noli, Spotorno, Savona-Fornaci, Bergeggi, Celle Ligure, Finale and Varazze.  Therefore, it could be an ideal market for buy-to-let investors who wish to purchase a property in a rapidly expanding market.

Gastronomic destinations in Italy boost property investment

Italy is an outstanding place to visit for its food, festivals and cultural attractions. The top European destination for food and wine was Florence in Italy, with Paris second, Rome third and Sorrento in Italy fourth.

According to a recent poll from Tripadvisor, Italy dominated the list with Siena in sixth place and Bologna seventh. The Spanish cities of San Sebastian were (eighth) and Barcelona (ninth) respectively, London failed to make the European top 10,   with Edinburgh 10th, according to a poll of world travelers. Italy is now well and truly establishing its place on Europe’s gastro tourism map which is good news for property investors as this means more travelers will be visiting the country

Tripadvisor spokeswoman Emma Shaw said: “With tough competition from destinations renowned for their culinary expertise, these awards recognize Europe’s best food and wine destinations according to millions of Tripadvisor travelers”.

Meanwhile, a new survey by Immobiliare.it confirmed that when Italians go house shopping there is one room that matters more than the rest: the kitchen. The website based its results on the 6 million queries it receives every month from people searching for new homes which shows the culinary interest in the country. Almost one in six Italian real estate shoppers wants a place for the family chef that includes an island. 14% even indicate the brand of kitchen that they are in the hunt for.

As la cucina matters most, Italian home buyers are even willing to adjust on other features like closets and balconies in support of a better place to cook and gather.