Housing emergency - few homes for rent, demand outstrips supply


One only has to take a tour of the various real estate portals or real estate agency websites to realize that this September will be a difficult month for those looking for rental property, the trend of the first half of 2022 is confirmed, which has sanctioned a less than prosperous period in the supply of housing available for rent, creating a real housing emergency.

The problem plagues the entire country from north to south, with an average loss of available rental properties of 33%. Doing a quick online search, alarm articles from all over Italy are flowing in, from Belluno with a loss of about 71% to Sicily with Catania at 41%, passing all over the boot.

The causes of the housing emergency lie in several aspects of the current historical moment.

First of all the pandemic has changed our habits and led to a reflection on what the new concept of living might be.

Homes became in this period work, study, e-commerce, gym etc etc. The lockdown, marked A before and after in the perception of domestic spaces; if before, for many people, the home represented a dormitory and a foothold for a quick change, today we realize that the home must be designed to accommodate our habits. People are looking for houses with an extra room to be used as a study, exclusive outdoor spaces, whether garden or terrace, that allow them to fully experience the house even in the milder seasons.

This new conception that is experienced regarding one's own housing has caused many families, couples and single individuals to make the decision to change housing, to move out of their original family unit or in the most delicate cases even face marital separations, with the consequence created of going to substantially increase the demand that unfortunately has not been supported by an adequate supply of housing.

Also not to be underestimated is the situation created in the last decade in many municipalities where new housing units are no longer being built and enormous difficulties are being faced in rehabilitating the existing building stock in a poor state of repair, often the costs of complying with current regulations, zoning and material costs, which have skyrocketed in the last two years, discourage those who own such properties from wanting to renovate them and put them on the market.

Another reason for the lack of rental homes is likely to be found in the choice of many people to put their property up for sale, thanks to the pull from the listings and the upswing in buying and selling, which marks a +41% over the previous year.

It is certainly worth considering another reason why the supply has reduced so substantially; with the return to pre-pandemic normality, many landlords are opting for short rentals (cultural and business tourists) or rentals limited to a few months (expatriate workers, students) with the hope of limiting the risk of tenant delinquency and the ambition of higher income. In some cities it has been found that tourist accommodation is outnumbering residential accommodation, this is leading to a change in people's lives and the urban and social organization of cities.

The main reasons why landlords decide to allocate their homes for short and vacation rentals are:

  • Traditional rentals are perceived as too risky; if the tenant does not pay, it is difficult to evict the tenant in a short period of time and it is almost impossible to recover the debt.
  • Short and vacation rentals are considered more cost-effective for the owner.

The rush to tourist rentals has transformed the area by populating it with a huge number of Bed and Breakfasts, Holiday Homes, Guest Houses, Guest Houses, Hostels, Holiday Homes, Country Houses, just to name the many types. But the easy profit from the tourist rental of a house is in some cases a fairy tale, this is because a house intended for tourist rentals requires more commitment, advertising, keeping a calendar of availability and reservations, check in and check out that are often difficult to organize, cleaning and changing linens, communication to the Police, payment of the tourist tax that added all together have the consequence of making it a real job. In addition, the lowest taxation applicable on short leases is 21% versus the 10% that can be applied on rent-agreed contracts in residential or transitional housing rentals. In addition, occupying a dwelling for 365 days a year with short rentals is practically impossible, indeed in some cities it is even forbidden; it has been estimated that the average occupancy of a vacation home in Italy is 60% with an average annual income that is often higher than that received from classic rentals but not by such a high figure as to justify the greater commitment made and a wear and tear on the dwelling that in the vast majority of cases is greater precisely by renting for short periods.

With the gradual conversion of downtowns to "vacation villages," the number of homes available for long-term rent, those usually taken on 4+4 or 3+2 contracts, is decreasing, and rising rents in the city's downtown areas have become unaffordable by the neighborhood's historic residents, so the option of taking downtown homes for rent is increasingly becoming the preserve of the wealthier social classes or those willing to share housing with others.

Renting property is still a good source of income, and there are many more people than you might imagine who are able to maintain contractual obligations and make the rental experience for the landlord as just a source of secure income. By taking a few steps and relying on a qualified agency, the whole process can be made easier and hassle-free. The agency can do a good job of screening with the right referral surveys on the prospective tenant in addition to an income analysis that reassures the landlord himself about the tenant's ability to pay the rents.

For example, our real estate agency provides "check client" service, as you can see by clicking on this link (https://marcocatelli.it/servizi-immobiliari/check-cliente), which is aimed precisely at making a sketch of the potential tenant.

The emergency is also felt in our area of responsibility, as reported by Marco Catelli in the article in Il Tirreno of Monday, Sept. 5, providing some food for thought and possible solutions including the recovery of abandoned huts or buildings or to the conversion of entire disused craft areas.

The province of Lucca loses 31.5% of homes available for rent, while the number of applications from people with a good profile who nevertheless cannot find a property in good condition and for a long period grows.

If you are curious about the clients who come to us to look for homes or you have a property you are not using and would like to know how much it can make you call us at 0583 997201 or send us an email at info@studioaffitti.it, we will find together the best solution for your needs.

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