Buying property in Venice is actually become easier
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“What’s not to love about Venice?” said an American tourist to me as we scanned the vista of Piazza San Marco and the Grand Canal, both sparkling in the sun. Indeed, what’s not to love? From its tiny, damp alleyways, to its waterfront cafes, historic churches and delicate bridges, Venice is like a beautiful woman who seems only to get better looking with age.
As a result, the city captures its fair share of hearts and tourists each year and some of the millions of visitors decide they want to stay on a more regular basis; however, house-hunting could be the first disappointment the city throws your way. Four years ago it wasn’t difficult to find small properties in quieter locations for under £300,000, but such is the demand that these days you need at least £500,000 to be able to get anything half decent.
The irony is that according to Rupert Fawcett of estate agency Knight Frank there is more available property in Venice now than a few years ago, as locals realise they are sitting on a sought after investment. “buying property in Venice is actually become easier” he says, “as, traditionally, properties were passed down through the family but now Venetians are more prepared to sell.”
Despite this, demand is strong enough to put a high price on anything remotely spacious or in a good location. The best palazzos on Knight Frank’s books stretch from £1.6m to over £11m, with such prices guaranteeing you a coveted central position near or overlooking the Grand Canal and often a myriad of original features such as ornate plasterwork, marble pillars and floors and stone balconies.
“A property in Venice is a trophy acquisition,” says Fawcett. “Prime properties in a central location don’t come onto the market that often but when they do they sell very quickly.”
If your budget won’t stretch to £1m plus, don’t despair - half that amount will still get you something reasonable. Fawcett says €500,000 (£390,000) is really the minimum you should expect to spend if you want to be in the secondary districts of the city, areas such as La Giudecca, the island opposite Piazza San Marco, or Cannaregio and Castello. “It is possible to get a place for less than that if you really hunt around,” he says, “but it will be very small; a studio or tiny one-bedroom apartment in a less popular area such as Santa Croce, around the station, and you’ll probably need to do some renovation work.”
The cheapest property for sale Fawcett currently has on his books is a studio in a new development on the Dorsoduro, one of the prime locations in the city, which is currently selling for €325,000 (£255,000), but he stresses that such places are very unusual and prices in the same development go up to €2.5 million (£1.96 million).
Most properties the agency is selling are around the €600,000 (£470,000) mark, including a large apartment on the Lido, Venice’s beachfront resort a short boat ride away. It’s a location Fawcett says some people like to be in, because it offers a touch of that Riviera lifestyle; however, it’s really a summer destination and can be dead in winter.
Knight Frank’s figures show property prices in Venice have escalated over the past two years at around 12.5 per cent per annum, which is in line with what property search expert Paul Hudson of The Property Finders has also experienced. “This is higher than the market in Italy in general.”
Hudson thinks Venice ticks all the boxes for property ownership: a perennially sought-after location offering solid capital appreciation, good rental opportunity and a lovely place to live. He says there has been a trend over recent years to buy a large palazzo and split it into flats but cautions anyone intending to do this that the restrictions on building work can be very stringent.
However, unless you have around €10 million (£7.85 million) to spend on a large building with potential the likelihood is you’ll have to settle for a property in a renovation project completed by someone else. Even if you can comfortably afford a restoration you’ll need to factor in the extra costs of bringing in materials as nothing is manufactured in Venice and everything needs to be imported.
Hudson also figures the best choice for those with less money is at the €550,000 (£430,000) to €600,000 (£470,000) mark. That, he says, will buy you something with two bedrooms in a nice but not necessarily glamorous area without canal views. “A two-bedroom property overlooking a canal will cost around €1 million (€785,000),” he says, “but in areas such as Greci, which has little piazzas and narrow streets, you can find very nice two-bedroom, two-bathroom properties for around €580,000 (£455,000) and it’s only ten minutes walk from San Marco.”
Hudson says property buyers shouldn’t be afraid to branch away from the main tourist spots in order to find cheaper options. “Outside the tourist areas you’ll find deserted streets and small canals; consider the San Luca and Accademia areas where properties are often up to 25 per cent less than the centre.”
Though many property buyers want to own in Venice for personal use, there is the obvious opportunity to rent your apartment out. Again, location is key, with prime positions inevitably commanding the highest rents. Hudson believes that a property for sale in a central location can yield in the region of €700 to €800 (£550 to £630) per week year round but if you’re not within walking distance of the tourist attractions you really will need to have easy access to the taxi and water bus stops.
Venice is surrounded by other islands, from La Giudecca, with its famous Cipriani Hotel, and more affordable new developments to the beaches of the Lido, Murano and Burano, further out in the lagoon.
These were all once much cheaper than buying in the main city but now investors have cottoned on and prices are comparable, though you may get a bit more for your money. On Burano, for example, Knight Frank recently sold a three-bedroom cottage for €560,000 (£440,000) and on La Guidecca it has a new-build apartment at €595,000 (£467,000) for one bedroom and amazing views towards the city or there’s a nice three-bedroom place costing €1.05 million (£825,000).
Trinidad Passerini of Precious Villas, which specialises in property in Italy at the high-end of the property market, agrees that La Giudecca is a good location to look. “La Giudecca has delivered quite a few apartments as a result of the renovation of big 19th-century buildings that are there, such as the former industrial mill, Molino Stucchi, where there are now resales coming onto the market.”
However, Passerini discounts outer districts such as the Lido or islands, claiming that they are not really a sensible buy. “The islands can be completely isolated in fog, and they are difficult to reach from the airport or the train station. They are also far away from the main sights.”
She also advises prospective property buyers to avoid ground-floor apartments, as the very thing that makes Venice attractive – the sheer abundance of water – also makes it perilous for buildings. “High tide is the most important thing to be aware of. I would never buy a ground-floor apartment, due to the high risk of water damage.”
Passerini also points out that most of the properties in Venice are listed. “This is good news and bad news,” she explains, “The taxation on the property is low and income from rental also has very low taxation, plus there is government help available for renovation.” However, there are also downsides to buying a period property. “There is a 60-day period during which the government has to decide whether to allow the sale as it has an option to buy the property.” She says it’s rare for the authorities to take possession of a property in this way but a property buyer will need to factor the extra time into the buying process.
It seems Venice may be like many beautiful women: difficult, demanding and certainly not cheap but once you get to know her you’ll love everything about her.
First published in Homes Overseas Magazine August 2008.
Some information contained within this article may have changed since it was first published. Homes Overseas strongly advises you to seek current legal and financial advise from a qualified professional.
