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Italy's housing slump is key election issue

Wednesday, Feb 20, 2013 - 02:24

Feb.20 - Italy's housing market is sinking partly due to a painful property levy brought in by Mario Monti. As the country prepares for weekend elections the issue is becoming a key one for voters. Hayley Platt reports.

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A new apartment complex on the outskirts of Rome takes shape. But with Italy deep in recession few can afford to buy them. The country's housing market is suffering its worst slump since the financial crisis began in 2008. Latest figures show home sales were down by almost a quarter on last year as were sales of commerical property. Mortages too have plunged significantly. That, say estate agents, is part of the problem (SOUNDBITE) (Italian) ESTATE AGENT FRANCESCO MINERVINI OF "ROMA IMMOBILIARE" SAYING: "Banks will not easily give out mortgages. Only people of a certain level, who were able to purchase houses before, can still do it today and so in the luxury sector it's been felt less. But in my opinion this has been the biggest problem." But the current Prime Minister is also being blamed. To raise cash he decided to tax all private home owners - not just those with more than one property. The so-called IMU levy has proved to be one of his most unpopular emergency measures. And his election rival Silvio Berlusconi has vowed to abolish it if he gets into power. Professor James Walston from the American University of Rome believes that would be a mistake. (SOUNDBITE) (English) PROFESSOR JAMES WALSTON OF THE AMERICAN UNIVERSITY OF ROME SAYING: "The Italians are coming to realise that property taxes are a fact of life. They are in the rest of Europe and they will continue to be in Italy. They don't like Monti for it and I'm sure a lot of people have been alienated from him, a few people believe Berlusconi's promise to reimburse the property tax but it's a little bit like the income tax which was introduced by William Pitt in 1805, I think, as a temporary measure. It's still with everyone." Another potential election leader is taking the middle ground. The Centre-left's Pier Luigi Bersani wants to tax SOME home owners. He's also fallen out with Monti which doesn't bode well, according to National Australia Bank's Tom Vosa. SOUNDBITE: Tom Vosa, National Australia Bank, saying (English): "It's difficult to see where Bernsani and Monti can work together given some of the anomosity and acrimony that has surrounded him during this campaign. I think even if we do get a Bersani-led government which is our expectation, it doesn't necessarily mean that we will have stability." And that's what most people want from this weekend's elections - a secure roof to shelter under.

Italy's housing slump is key election issue

Wednesday, Feb 20, 2013 - 02:24

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