International Real Estate | Citizenship | Residencies | International Tax Strategy | Internationalization & Diversification Consultant
Yes, I know. Italy is a basket case, especially the South. But I must say that what I saw in Sicily was a good number of decent real estate opportunities. I was there a few months ago with Keith, my real estate agent in Turkey who is also a full-time investor like me. We were sniffing around for deals in Europe and Sicily had some interesting metrics. So we both flew there and spent over a week driving around and seeing what the reality is on the ground. It almost feels like the inflation crisis never touched Sicily. We're talking 5 euro pizzas in villages, or 10 euros in prime touristic areas, €2 beers, etc. The food and drink are amazing, the people are good fun, and the landscapes are lovely. Italy is Italy, I don't need to sell the lifestyle. But the overall value is amazing. I can categorically say that Sicily is now more affordable than the vast majority of Eastern Europe and the Balkans. Southern Europe is the new Eastern Europe without the economic dynamism. And real estate is a steal We checked out a bunch of properties in a few towns. We particularly liked Syracusa. If done right, one can definitely earn 4%-5% + net yields after all expenses and taxes. In many cases, there are much lower taxes involved when purchasing a single property in Italy. Taxes go up from the second property onward, so I see Italy as a one property play. But there are some ambiguities in the Italian tax system, as with anything Italy-related. Why real estate in Sicily? One of the aspects I really like about Sicily, is not only that an investment property can double as a lifestyle property, but that the seasonality is much lower than in other European destinations. The weather is great most of the year, so Europeans absolutely love to come down even in Winter. Catania and Palermo airports are both pretty major airports with daily flights to literally everywhere in Europe. Low-cost flights, every day of the year. These airports operate like machines. So your investment or lifestyle property is always a short and cheap flight away from pretty much everywhere in Europe. How to play real estate in Sicily? I'd focus on either the major cities (excluding Catania, which feels like a meteor landed right in the middle), or just some nice rural property. Real estate is incredibly cheap. In many cases even near-prime real estate is less than €1,000 per m2. But these properties require a gut-job. The key is to do a good job with the renovation. The gap I see in the market is that most investors are local Italians, or Europeans on a budget. The end result is that remodeling jobs are on the cheap side, so most Airbnb owners end up competing on price rather than quality. There is a massive market of Scandinavians, North Americans, and other Europeans that have bigger budgets and wouldn't mind paying for quality, which would result in higher net rental yields for investors as there is less competition in this segment. https://lnkd.in/eyYMrW6G
