What does the future look like for real estate in Italy

Andrea Toscano talks to Wanted in Rome about the current situation of the Italian real estate sector as it deals with the fallout from the coronavirus lockdown.

by Marco Venturini

You are the managing director of Gruppo Toscano Spa, one of the largest and most important real estate agencies in Italy. Would you give us a general panorama of the group and the services it offers.

We started 37 years ago and we deal mainly with real estate brokerage. Over the years we have grown from a small local Roman firm to a national one.

The core business is developed by two main companies: Toscano Spa which specialises in real estate brokerage, and Gruppo Toscano Spa which is dedicated to the development of the Toscano brand and franchise.

We therefore have a network of directly controlled agencies that allow us to improve working methods and operational tools, with constant training of human resources. Everything is then made available to the affiliate network.

All our commercial resources are always supported by the marketing division that deals with business promotion, communication and marketing of our services.

We also have our Toscano Lab that deals with the training and recruiting of our junior and senior personnel.

Through the other specialised companies we offer a 360-degree service for those who want to sell or buy any type of property:

  • Toscano Mutui is the Toscano Group company specialising in the credit brokerage sector.
  • Oasi Home Design offers all the necessary services for planning and renovation.
  • Guidobaldi Luxury Properties is the exclusive Toscano network dedicated to the brokerage of luxury properties.

What is the importance of the real estate sector in Italy and what significance does it have in terms of the country's employment and for GDP.

In Italy the real estate market represents almost a fifth of gross domestic product, with a steady growth in recent years. It couldn't be otherwise, considering that the concept of real estate and house ownership in Italy is very strong, whether as a necessity or as an investment.

In terms of employment, from design to sales, our sector is growing at approximately half a million employees a year. There is still space for growth around the main players in the sector, and we are finding it even more margins right now.

To what extent has the sector been hit by the coronavirus pandemic?

The market has clearly slowed down. But after a rapid reorganisation to adapt to the new daily dynamics, the visits to the apartments have resumed and are continuing online with video visits.

The analysis of the research done on our website www.toscano.it clearly shows the desire of people to continue to move forward with their projects. The fact that we were ready to use new tools and new technologies really made the difference and we have had excellent results at a commercial level. We also received many thank-you messages for supporting customers in this difficult period.

Is there already an estimate of the damage?

Wanting to be realistic, the damage is estimated at around 20-30 per cent of the total, if we consider only the lockdown period of about two months. As for restarting, much will depend on the speed with which all activities will resume.

What are the main worries of your associates? And in what way are you working to help them?

We immediately adapted to change. Many questions have been asked: how can we stay in touch with our customers? How can we show the houses we have? What will be the future of our profession?

We have a corporate WhatsApp Group in which we constantly communicated the group's news and new strategies. Clearly it has become a fundamental means of keeping in touch with one another.

We constantly meet with the sales network to give operational clarity that allows us to start quickly.

We are working with even greater attention to customer care, the property portfolio and purchase requests.

In addition, there were many initiatives that we put in place immediately to answer the questions that our sales network asked us, and to support them in their business:

  • We have communicated with our current customers (sellers and buyers) that we are operating and the tools we are using:

- Sending newsletters to the database (over 440,000 emails).

- Communication on television with a specific advertisement created for the moment.

- Communication on our website.

- Targeted communication on social media.

 

  • We have created virtual agencies to communicate with our customers. To do this we have chosen video conference and video calling tools for direct contact with the customer.
  • We have kept online advertising active to support the sales network.
  • We have digitized all our paper forms.
  • We have provided clear and precise indications on the operational activities on which to concentrate and how to do it.
  • The training with the Toscano Lab in the Milan and Rome offices has moved completely online. So far we have carried out 20 webinars with an average of 200 participants and a rating of 4.7 out of 5.
  • We are continuing to show properties by making video calls with customers and showing them virtual tours or videos of the apartments.

Then I personally produce videos every day in which I tell my experiences or provide practical and concrete ideas and suggestions on how to carry on the business and what to focus on.

It is a great way to be even closer to our sales network of around 600 agents throughout Italy, and to keep their morale high. The videos are shared with the whole network via WhatsApp and are also posted on social networks (Youtube, Facebook, Instagram and Linkedin) to give support to anyone interested in the topics covered.

Also read: 

In what way has the pandemic revolutionised the real estate industry in Italy?

It has forced us to use more of the technology we already had. In recent years we have prepared a lot on a technological level and today we are benefiting from it.

Certainly the use of digital tools will become an integral part of our way of working, for example some aspects of closing a sale will be optimized through video calls and virtual visits.

We will continue to sell houses with appointments on the spot but many preparatory phases will be digitized and therefore optimized also because social distancing will still continue when the reopening starts. 

What are you predictions of the the coming months?

Making predictions right now is pretty difficult.

In the first phase it will be important to focus on the needs of buyers, on those who had a purchase planned and want to continue with their project. However investors are likely to take some time to see how the market has reacted.

The three-bed room apartment, the family home, will be most popular.

Outdoor spaces, which already had value before, will be even more important after the quarantine, in particular the houses with gardens will be even more interesting. 

Do you think there could be a move from the large cities to the country?

We have analysed the first real data taken from our internet portal on the searches that users are carrying out in the two main cities: Rome and Milan.

It turns out that Rome has seen an increase of about 30 per cent in searches in the areas of Ostia, Ostia Antica, Trigoria and Infernetto, all areas on the Lazio coast. The required size is between 150 sqm and 200 sqm with garden and with a budget of €300,000-450,000. At the same time, there was a slight drop in searches in the central areas of Rome.

The trend in Milan is different, where searches in the city centre are still very high, especially in the areas of Porta Romana, V Giornate and Indipendenza. We have seen an increase in searches above €1,000,000 for an area of more than 200 sqm, even if the search for two-room bedroom apartments continues at the same time. In areas a little further from the centre, such as Maciachini and Frattini, the search for two-room bedroom apartments has increased, with budgets between €180,000-220,000.

What would you say to those who want to buy and those who want to sell or rent?

The people who need to sell or buy a house were motivated by specific reasons before the emergency. These are life projects which it is important to continue if possible. I would say that there will certainly be great interest in the market and we shall give total customer support.

Do requests from abroad have an important place in your activities, and if so how do you think these will change post pandemic?

The methods we use today with our customers in Italy were already in use with our foreign customers. The first visit was often made with a virtual tour to give customers the opportunity to see only the properties they were interested in. But foreign demand will be the last to restart as it is linked to the recovery of tourism in our country.

Also read: 

What steps do you think the government should take to help the real estate sector?

It is necessary to restart a regular work routine as soon as possible, naturally observing measures that guarantee the total safety of customers and agents.

An immediate equalisation of our business with that of the other operators in the real estate chain: a real estate agent must be able to continue business and completing contracts, as is also the case for banks, notaries and credit brokers.

It will also be important to have more digitised operational procedures with the state, for example, for the registration of online preliminaries.

A suspension of taxes and duties would be desirable, in particular the taxes that we should pay in June.

There should be strong support for private mortgages which will be needed to give oxygen to the whole sector as there is a risk of a loss of liquidity among private individuals. Banks will be more likely to favour companies, given the loans guaranteed by the state, with the risk of slowing down the payments to the private sector, which plays a fundamental role in the real estate sector.

For the Toscano website click here