The real estate market is reviving without showing criticality a year and a half after the outbreak of the Covid emergency. The purchase for investment is still seen as a good solution to diversify your portfolio, being an asset with a low risk and to be evaluated with a long-term look.
But what are the real returns like? The latest data processed by the Tecnocasa Group’s Research Department and relating to the second half of 2020 show that the gross annual yield of a 65 sqm two-room apartment in large Italian cities was around 5.0%, the metropolises that stand out for having the highest yields are: Genoa and Verona with 6.2 and 6.1%, Palermo with 6% and in third place Bari with 5.4%.
A target, always highly appreciated by investors, is that of students despite having been partly absent from the classrooms during the pandemic. In this case, the neighborhoods close to the universities or well connected with them were the preferred ones. Another aspect to consider, whose weight has increased especially after the pandemic, is the presence of services (shops, supermarkets, schools, etc.) within the neighborhoods. These elements allow you to evaluate the purchase by investment immediately. But there are also those who decide to invest in the real estate market by betting on the future. And in this case, the areas that are subject to redevelopment are affected and have all the elements to be able to be re-evaluated. For example, one could look at the districts that will be served by subway stops, in particular the more peripheral ones, there may also be double-digit revaluations.
In general, those who invest in the real estate sector not only look at rental yields, which are currently around 5% gross per annum, but also and above all at capital appreciation. From 1998 to 2020, limiting the examination to large Italian cities results in a revaluation of 37.1%. The one that appreciated the most was Milan with 103.7%, followed by Florence with 66.0% and Naples with 64.3%.