Calabria Property: an Investment Overview

Calabria property emerged onto the radar of international investors in a big way at the end of 2007 and grew in popularity into 2008; during the height of the overseas property investment boom. At the time it was growing in popularity as a tourism destination, and this began to attract the attention of developers.

Calabrian properties were coming onto the market at far lower prices than those in Italy's traditional favourites like Tuscany and of course Milan, and with rising tourism this gave way to forecasts of strong rental yields and growth prospects. 12-18 months and an international downturn later, I decided to take a look at Calabria property as an investment.

Calabrian Property as an Investment

Rental Yields

When Calabria emerged onto the scene, analysts were forecasting 6% rental yields on off plan properties once they were completed. This was based on the occupancy levels at the time. Analysts also believed that Calabria's growth in popularity would see occupancy levels continue to rise and rental yields along with it.

The on-set of the international downturn and the strengthening of the Euro, caused occupancy levels to drop off and rental yields to dwindle. The international recovery is expected to start later this year. In 2010 occupancy levels on Calabria property will begin to rise again, rental yields will quickly return to 6% and begin to grow to around the 8% mark.

Capital Growth

At the same time, forecasts for capital growth on Calabrian property stood at an average 15-20% per year over the next 5-10, with the potential for growth spurts of 30% plus during overseas property investment and second home buying boom times.

Property is an asset class that always grows over the long-term, with developed housing markets in developed economies seeing annual growth averaging around 10%, during normal conditions. Calabria property saw forecasts of more than that because of the low prices of property in Calabria compared to the rest of Italy and other similar places in developed countries around the world.

The international downturn sent everyone running from the hills, and it is likely to have damaged off plan property sales irreparably, but that shouldn't be the case. Yes, the growth forecasted won't happen this year, but when the international recovery begins, Calabria property will be back on track to meet its forecasted growth.

Demand already increasing

In the last 6 months, analysts have spoken about pent-up demand for overseas property, especially within Britain, both investors and lifestyle buyers waiting to see how much prices would fall, and to time it right when Sterling gets stronger.

Now Sterling is strengthening this demand is beginning to be released and the established markets of Italy and France are once again becoming more popular than the emerging markets and demand is increasing rapidly. Calabria is set to be a massive benefactor as this trend emerges according to experts on the ground.

"Though Sterling has been strengthening since the beginning of April, it's really only in the last three weeks that enquiries have started to increase, and we are seeing a lot more people taking us up on inspection visits to Calabria" said Tam Stanley of Calabria based online agency Calabrian-Property.com, offering Calabria property for sale from £62,000.

It's not just the strength of the Pound it's the fact that Calabria has remained stable throughout the downturn. Prices were never over-inflated so they never had to be corrected, and on top of that people know the Italian government won't allow it to become over-developed," he explained.

We are expecting to see sales increasing throughout the summer and are hoping that things will be back to normal by next spring," he concluded.

Calabria Property as a Holiday Home

Calabria is on the south west tip of Italy, surrounded by glorious coastlines and turquoise waters on three sides. It has beautiful beaches, gorgeous landscapes, a great climate and a relaxed Mediterranean way of life. This makes buying property in Calabria an excellent lifestyle choice, whether it is to have relaxing holidays in, or moving into for a more relaxed life altogether.

As an added bonus, Calabria slopes upward as you come inland, so most of the properties have been and are being built with impressive views of one or more of the gorgeous coastlines.

All in all Calabria property has got to be on the short-list of anyone looking to make a holiday home investment.

Italy's southern regions, including Calabria are famous for their relaxed way of life, and it is truly one of the most gorgeous places in the world. A Calabrian property will give you some of the most relaxing holidays you have ever had, and make you a substantial annual income. Then, in 20, 30 or 40 years it will be your choice whether you want to continue using it as you have, retire to it, leave it to the kids and grand-kids or sell it for a major profit.