Engel & Völkers conducted an analysis on the real estate market trends of some of the most fascinating islands in Italy: Capri, Elba, Ischia, Pantelleria, Procida, as well as the Aeolian, Egadi and Pontine islands. “During the coronavirus pandemic, especially in 2021, we have noticed that due to the strength of the premium segment, prices have not suffered the impact of the post-Covid economic crisis. The presence of international buyers also remains very high and we predict an increase in the upcoming months,” says Paloma Pérez Bravo, Chief Operating Officer of Engel & Völkers AG.
Capri, famous all over the world for the Blue Grotto, the Faraglioni, the Natural Arch and the presence of the international jet set, has 60 percent foreign customers, in particular Germans, Belgians and Swiss who represent 50 percent of all international buyers, and Americans, Australians, Swedish and from the Middle East, who make up the other half of the foreign clientele. These are mainly business people as well as an increasing number coming from the movie, TV and music industry, who occupy their property as a summer destination or as a safe haven for some weeks. Around 70 percent are also investors looking for second homes to make an income or to use during the summer holidays. The most sought-after properties are those that enjoy an optimal position located in the center of Capri: in Tragara, in Matermania and in Marina Piccola, with Anacapri enjoying increasing success. Square meter prices for apartments can reach up to 9,000 euros and the maximum priced house currently in the portfolio of Engel & Völkers is of 4.95 million euros for a villa with sea view and a pool.
Elba, the most important island of the Tuscan archipelago, known for its crystalline sea with over a hundred beaches, is highly appreciated by international customers who make up 60 percent of buyers on the island, mainly coming from the DACH region. Elba is reachable in a two-hour car-ride from the international airport of Pisa, including a 30-minute ferry ride from Piombino on the mainland to Cavo, the eastern point of the island. According to data provided by the Engel & Völkers Elba-Livorno shop, the demand for real estate is higher than the offer due to the lack of properties currently on the market. This year, prices on the island have increased by an average of five percent compared to last year. Apartments fluctuate between 4,000 and 7,000 euros per square meter, whereas the maximum price is 8 million euros for Villa Isola d’Elba in Marciana, directly at the sea. Particularly in demand are the localities of Porto Azzurro, Capoliveri, Capo d'Arco, Sant'Andrea, Procchio, Marciana Marina, Portoferraio (white beaches area), Lacona, Scaglieri and Zanca. Buyers tend to favor villas with gardens or terraces and with private beach access. According to Engel & Völkers, prices will remain stable by the end of the year and interesting new construction projects could be implemented in the coming months.
Ischia, a volcanic island in the Gulf of Naples and famous for its thermal springs, offers several attractions such as historical monuments, beautiful beaches and excursions for nature lovers. Procida, on the other hand, is further away from mass tourism and is more appreciated by those looking for privacy and relaxation. Not surprisingly, it will be named as the capital of culture in 2022. Both in Ischia and Procida Italians make up 60 percent of the clientele, whereas international buyers are known to come from Germany (60 percent), as well as from the USA and Canada (who make up the remaining 40 percent). Apartment prices on both islands reach up to 4,000 euros per square meter and the asking price for a single-family house can be of 4 million euros. The relationship between supply and demand is fairly balanced and around 80 percent of buyers already own a house on the island and are looking for a second home. On the other hand, 20 percent of customers are represented by those who buy a prestigious property for investment purposes. Real estate located in Ischia Ponte and in proximity to the port, as well as all around the small island of Procida, are the most favored.
The Aeolian Islands, a volcanic archipelago in the Tyrrhenian Sea north of Sicily, are undoubtedly among the most fascinating in Italy. Each of the seven islands of the Aeolian archipelago have unique characteristics: Panarea is the highlight for international jet-set, Stromboli, Alicudi and Filicudi are favored by nature lovers. Vulcano is particularly appreciated by families, while Lipari by young people. The most popular and requested islands are Panarea, Salina and Stromboli, also due to their easy-reachable position by ferry from Naples, Sicily and Reggio Calabria. The clientele on the islands is 50 percent national, in particular from Northern Italy, and 50 percent foreign. Germans and Swiss represent 60 percent of the international clientele, while the remaining group is characterized by French, Belgians, British and Luxembourgers. These mainly search for properties overlooking the sea, with large terraces and private parking. Most of the high-end properties, of which prices range between 1,500 and 4,000 euros per square meter for apartments and between 500,000 and 1.2 million euros for houses, are purchased to be used as a second home during the summer and that can be rented out during the rest of the year thus providing income. According to the shop of Engel & Völkers Messina and the Aeolian Islands, prices will rise by the end of the year due to the increase in international jet-set and the construction of an airport for private flights, in front of the Aeolian Islands, on the northern Tyrrhenian coast of Sicily.
The Egadi Islands (namely Favignana, Marettimo and Levanzo) and Pantelleria are sought after by 80 percent of international customers who mainly come from the UK, followed by Germans and Swiss. Favignana is known for its enchanting beaches including Cala Rossa, Bue Marino, Lido Burrone, Cala Azzurra and Cala Rotonda, for the Lovers' Cave and the Castle of Santa Caterina. Marettimo is characterized by its rocky coast with hundreds of caves and coves, as well as the Castle of Punta Troia. Pantelleria, the most famous of all, is known for its bays and crystal-clear sea, as well as its famous white wine Passito di Pantelleria and the Zibibbo grapes. There are also numerous archaeological sites in this area, such as the Sesi necropolis, one of the most important sites in the entire Mediterranean basin. Pantelleria is also famous for its seabed, which makes it a paradise for divers, and for the possibility of trekking. Prices for flats on all three islands can reach up to 3,000 euros per square meter, whereas for a villa up to 1.75 million euros. In the Egadi Islands the demand is higher than the offer and stable in Pantelleria.
The islands of Ponza, Ventotene and Palmarola, located in the Tyrrhenian Sea between Rome and Naples, are amongst the most exclusive destinations and are surrounded by crystalline waters where several VIPs, including the Fendi sisters, own their villas by the sea. The Pontine islands are particularly appreciated for their strategic location, one hour away from Rome and Naples, the coast and the medieval villages. Italian buyers, particularly Romans and Neapolitans, occupy 60 percent of the real estate market on these islands. The prevalence of international buyers is made up by Germans and Swiss. Around 90 percent of buyers already own a house in the archipelago, while the remaining 10 percent are private and institutional investors. The most sought-after areas are the surrounding locations of Ponza, where square meter prices for apartments reach up to 9,000 euros. On the islands of Ponza, Ventotene and Palmarola prices for flats reach up to 5,000 euros per square meter and 4 million euros for a single-family house. In the upcoming years demand, both from national and international property searchers, is expected to rise leading to an increase in prices. Homes in quiet areas, with large indoor and outdoor spaces and where smart-working can be enjoyed, will be highly requested.
Outlook: Increase in international fame and a slight rise in prices
“Italy and its islands have always been an attractive location for purchasing real estate, especially for clients from abroad,” says Paloma Pérez Bravo. “We are expecting an increase in international jet-set from Northern Europe as well as North America, who will be able to enjoy the islands no longer with any sort of restrictions as soon as the pandemic is fully under control,” she concludes. The majority of the real estate clients on these islands will continue to purchase properties as a second home where they can spend the summer or a longer period of time for remote working, and on the other hand for investment purposes to gain an income through rent.