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Residential real estate market on Sicily: Demand for top properties continues to rise

The residential real estate market on Sicily is experiencing growth and there is increasing demand in the luxury segment. While potential buyers have tended to be hesitant in recent years as a result of the economic recession, the sales volume rose in the first half of 2017 by 6.5 percent. “The Sicilian real estate market continues to strengthen. Reasons for this are the consistently high demand from abroad, the growing trend of renting out second homes, and the large number of local mortgage lenders,” said Alberto Cogliati, Expansion Director at Engel & Völkers Italy.

Sintra - Real estate in Sicily is becoming more expensive: High demand from abroad for first and second homes is boosting the market.

Palermo

In the capital Palermo on Sicily’s north coast, the majority of potential real estate buyers are looking for main residences, and prime locations include Piazza Verdi, Piazza Politeama and Libertá-Sammartino. Families make up this buyer group for the most part, and 90 percent are from Italy. The suburb of Mondello, around 10 kilometres from Palermo, is the most sought-after district for acquiring a second home. Buyers are attracted above all by the many art nouveau villas located next to the beach. While property prices in the luxury segment remained stable in Palermo in 2015 and 2016, Engel & Völkers registered a rise in 2017. The average prices for properties in prime locations rose to between 2,850 and 3,150 euros per square metre. The most desirable properties are those in prime locations with outstanding views, close to the sea or in the city centre of Palermo.

Cefalù

The coastal town of Cefalù on the north coast of Sicily is one of the most desirable holiday destinations on the island, which makes it a particular magnet for international buyers. British, American, German and Spanish clients in particular have shown increased interest here. In 2017, property prices in the town and the surrounding areas were considerably higher than 2016, reaching between 3,300 and 4,500 euros per square metre on average in very good locations. Over the last two years, top prices of 5,000 euros per square metre have not been unusual for exclusive properties in and around Cefalù. Particularly in demand are properties with sea views, and those with a terrace or balcony. The centre of Cefalù, encompassing the streets of Corso Ruggero, Via Vittorio Emanuele and Via Carlo Ortolani di Bordonaro, is one of the most sought-after locations.

Catania

The luxury property market in Catania on the east coast is enjoying growing popularity. The most sought-after residential districts are around the streets of Corso Italia and Via Etnea, while the neighbouring communes of San Gregorio di Catania and Aci Castello also attract a great deal of buyer interest. “In addition to holidaymakers and second home buyers, Catania also attracts many people in search of a primary place of residence. The most popular types of property are penthouses with terraces and ocean views, preferably with three bedrooms,” said Luca Venora, Managing Partner of Engel & Völkers in Catania, Taormina-Etna and Syrakus.  94 percent of demand here is from local buyers. Internation​al​ buyers come from overseas, mainly from Germany, Switzerland and France. New properties in the best locations fetched between 2,300 and 3,300 euros per square metre in 2017. In the last two years the highest price recorded in Catania was 3,900 euros per square metre.

Taormina, Etna and the East Coast

Thanks to its wonderful location between the sea and the mountains, Taormina is one of the island’s most popular holiday destinations. Demand for prestigious apartments has soared and the number of property transactions has also increased considerably in the last two years. 40 percent of all buyers are from overseas, though local clientele are also investing here in second homes. “Potential buyers in Taormina are particularly interested in villas close to the sea and premium apartments with a garage or parking space in the old town,” said Antonio Carnazza, Managing Partner of Engel & Völkers in Catania, Taormina-Etna and Syrakus. In 2017, the average price for new builds in exclusive locations in Taormina was between 3,000 and 4,000 euros per square metre. Prices for existing properties have also risen slightly over the previous year. The highest residential real estate  prices in the whole of Sicily were recorded in Taormina – with new developments in prime locations reaching price highs of 7,300 euros per square metre.

Syracuse

Syracuse on the south-east coast is a popular holiday destination. The beaches are some of the finest in Italy. Over 80 percent of the properties in Syracuse are sold as second homes,  mainly to families. The majority of international buyers come from the UK, Germany and France. Some of the most desirable properties are medium-sized and large apartments (50 to 100 square metres) with a terrace and sea views. The prices for luxury properties in Syracuse rose by around 3.5 percent in 2017, with average prices of 3,000 to 3,900 euros per square metre. For properties in prime locations in Ortigia, the historic centre of the city, prices reached up to 5,000 euros per square metre.

Ragusa

As a popular second home location, the property market in Ragusa was barely affected by the economic crisis. The city, with its 18th century Baroque buildings, is a UNESCO World Heritage site. The international clientele comes mainly from Northern Europe, in particular from Belgium, Germany, Switzerland and the UK. Buyers are primarily interested in large estates or manor houses, as well as modern villas close to the sea with a garden and a pool. In 2017, luxury homes in Ragusa fetched between 1,800 and 2,550 euros per square metre, with top prices as high as 2,700 euros per square metre.

Trapani  

Trapani lies in the north-west of Sicily. This coastal resort is also known as the city between two seas, as this is where the Tyrrhenian Sea meets the Mediterranean. The main buyer groups are families who prefer houses with a large garden and a pool. 75 percent of potential buyers are of Italian origin, with international demand coming from Austrian, German and British buyers. The average price for a property in an excellent location in Trapani in 2017 was between 2,000 and 2,200 euros per square metre. A higher price bracket was registered for properties on the offshore islands of Favignana and Marettimo. In Favignana, a renovated villa or an apartment in an exclusive district cost around 4,100 to 4,500 euros per square metre.

Outlook: A good time to invest

At present the prices for real estate on Sicily are still at a moderate level. The end of the economic crisis in Italy means that the demand for first and second homes will continue to rise in 2018. This trend will result in an increase in property prices. “Now is therefore a good time to invest on this Mediterranean island,” said Alberto Cogliati. One of the most up-and-coming districts in Sicily is Ortigia, the old town of Syracuse, where demand is already exceeding the availability of listings. A steady growth in demand can also be seen in Noto, the coastal region near Capo d’Orlando, and in the historic centre of Catania.

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