Words by Carla Passino

It is jo-jo going for the Italian lakeside property market—up in one place, down in the next, according to a report by Italian estate agent conglomerate Tecnocasa.

Nowhere is this more evident than in the stretch of northern lakes that goes from Lake Maggiore to Lake Garda.

The Tecnocasa study reveals that prices on Lake Maggiore have gone down by 3% in the second half of 2007. Values for second homes in Intra, the largest of the lakeside resorts, are down 1.9%, even though demand is still coming from Milanese or Varese buyers interested in one- or two-bedroom homes close to the Lake. Flats with lake views now cost in the region of € 2,200-2,400 per square metre (less if they need renovation). In the smaller villages of Pallanza and Suna values have declined even more—5.9%. Flats in the historic village centres are the most sought-after and cost in the region of €1,800 in Pallanza and €2,000 in Suna, with most of the interest coming from Piedmontese and Lombardy buyers. Those with lake views are the most popular, but obviously cost significantly more.

Hop east to Lake Como, and it is a different story. Prices have gone up, albeit by a modest 1.5%, in the second half of 2007. Unlike Lake Maggiore, foreign buyers are present in great numbers here: Americans like the western stretch between Lenno and Menaggio, while Britons, Germans and Russians look at second homes in or around Como itself. Russian and other foreign entrepreneurs are also snapping up the few 19th century villas that come up for sale between Cernobbio and Laglio (where George Clooney has his villas). These homes are beyond expensive, but prices are on the steep side throughout the south-western branch of the lake. In Como, a resale property with lake views costs on average €3,000 per square metre (up to €4,000 for new builds).

Resorts on Lake Garda have seen a marginal decrease in values (0.1%) although the trend varies noticeably from resort to resort. Prices are stable throughout most of the stretch of lake that falls in the Verona province, but in Malcesine they are up 3.1% due to a shortage of supply. Buyers here are mostly Italians, but there is growing interest from Britons looking for lake views. They can expect to spend in the region of €3,000-3,500 per square metre for homes in need of renovation and up to €5,500 for ones that have already been restored.

Salo, In the Brescia province, is another Garda resort that is bucking the trend. It has seen a good price rise over the last six months of 2007, partly thanks to the infrastructure works that have taken place since the earthquake of 2004, which have given new impulse to the property market. Buyers from Italy, but also Britain and Germany, like the 19th century palazzos in the town centre, and anything with lake views.

Over in Lake Iseo, the market is on the rise again. A shortage of supply and a keen demand ensure that prices are up 5.6%, and that properties with lake views command a staggering premium of up to 20%. The villages of Sarnico, Vigolo, Predore, Tavernola e Paratico are particularly popular with both Italian and foreign buyers—mostly French and British—who like panoramic hilltop homes, for which they are easily prepared to spend €300,000.

In general, however, lakeside homes across Italy are gently depreciating, with an average decline in values of 0.9%. The biggest drop is on Lake Trasimeno, where prices have gone down by a whopping 12.6%, and demand from German, French and Dutch buyers has markedly decreased. That said, interest from Britons and Scandinavians is on the rise, and they are happy to pay in the region of €500,000 for villas with lake views. Tuoro sul Trasimeno, where values went down 14%, now is one of the most affordable lakeside resorts in Italy, with prices for quality resale homes in the village centre averaging €800 per square metre. By contrast, in Italy’s most expensive lakeside location—the town centre in Desenzano sul Garda—buyers can expect to pay €4,100 for the same kind of property.