Those $1 Villas For Sale In Italy Could Cost You Over $100,000

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Those $1 Villas For Sale In Italy Could Cost You Over $100,000

 Euro House in Ollolai, Sardinia, after renovation. AMKINA-EXPERIENCE.COM

Since January 2016, a growing number of small, rural towns in Italy have been selling villas for the symbolic price of one euro, or just 1.13 dollars. Ollolai (Sardinia), Sambuca (Sicily), Cantiano (Le Marche), Mussomeli (Sicily), and Zungoli (Campania) are just a few on the list, and an increasing number of municipalities are considering offering similar deals.

So far, about 200 houses have been sold, according to the official 1€ Houses website. However, most of these “fixer-uppers” will require significantly more capital, on top of the initial one euro, to get them into shape.

First, there are a number of conditions which buyers generally must follow. Purchasers must provide an insurance deposit of between 1,000 and 5,000 euros depending on the town. Then, they must submit their renovation plans to the town council, and these plans must be completed within a set time frame, usually about three years. But the precise details regarding the acquisition process vary depending on municipality; for example, the town of Sambuca, in Sicily, chose to run an auction with a one euro starting price, rather than directly selling the homes for one euro.

The Italian towns are basically giving away properties in an effort to combat their shrinking and aging populations. According to Istat (the Italian National Institute of Statistics), in the last 20 years, more than 1 million people have moved from the rural southern region of the country to the center-north, home of major urban areas like Rome and Milan. Moreover, almost half of those migrating are young, between the ages of 15 and 39, and are more likely than older individuals to move towards urban centers with more job opportunities.

The shifting of large groups of young people and families is causing many rural towns to lose residents and putting local institutions like schools at risk of shutting down due to low enrollment, according to Filippo Gentilotti, the Council Member responsible for the “1 Euro Houses” project in Cantiano (Le Marche).

The overall objective of the project is more or less consistent among the participating towns, entailing the "recovery, development, and repopulation of the municipality," according to the Caprarica (Puglia) one euro houses announcement. Gentilotti says that the Cantiano project’s objective is to increase the town’s population, stimulate income and transactions, and boost tax revenue. It should also have a ripple effect for local businesses like hotels and restaurants.

Many of the buyers, lured by dreams of picturesque Mediterranean living, may be surprised at the true cost of a one euro home. The seemingly low starting price unfortunately masks the significant costs of renovation. In Sambuca (Sicily), the council-mandated minimum renovation expense is 15,000 euros, according to Meredith Tabbone, purchaser of a 600 square-foot home. Tabbone had been interested in buying property in the south of Italy for about ten years.

“My great grandfather was born here,” said Tabbone, who resides permanently in Chicago, Illinois and is looking forward to reconnecting with her family's roots. “He left here when he was 15 to go to the United States.” She plans to initially use the 18th-century, three-bedroom townhouse as a vacation home and then retire there. Tabbone predicts that her renovation expenses will be around 50,000 to 60,000 euros when she is finished.

Another buyer in Sambuca is Massoud Ahmadi, who was especially fond of the area’s Moorish influences and architecture and plans to spend half his year in Sambuca. “I am interested in the process of rebuilding these homes and giving back something to the community,” says Ahmadi, who expects to pay between 60,000 and 70,000 euros to renovate an 18th-century three-story home which will have two bedrooms, a large roof terrace, and embedded historic features.

Both Sambuca buyers add that the cost could be higher than they anticipate.

Alan Massacesi, a potential buyer in Cantiano (Le Marche) who is currently based in the city of Pescara, is looking to buy a one euro house and transform it into an "off-the-grid" home. He is interested in the initiative because he hopes that Cantiano will have fewer legal restrictions on the renovation than the excessive and complicated bureaucracy that he says is typical of Italian cities like Pescara.

Gal Osovsky–another buyer in Sicily’s Sambuca–estimates that he'll pay about 110,000 euros for each of the four apartments he plans to develop.

Osovsky, who lives in Israel, bought the property with the idea that he would demolish and rebuild, selling three apartments and retaining ownership of one. "It costs more to renovate than to build from scratch," he says. More importantly, Osovsky expects a significant return on his investment once he puts the apartments up for sale, because Sambuca is a historic location and because the municipality is promoting the area.

While renovation costs for virtually all of the homes will be steep, the living costs and local taxes are quite low, according to Tabbone. However, one of the main challenges for many buyers, especially those from outside Italy, is the language barrier in small towns. According to Ahmadi, few speak English in Sambuca. Osovsky, who echoes Ahmadi’s claim, hired an assistant to translate and help him deal with the local bureaucracy and contractors.

Many of those buying up these bargain-basement Italian homes are looking for more than relaxing retirement digs. Maurizio Berti, the creator of a website called 1€ Houses -Cheap Houses In Italy explains that a number of buyers in the town of Ollolai (Sicily) are starting small businesses: "mostly Bed & Breakfasts, one couple set up a Fashion Atelier, and another an Artists' Atelier."

Marije Graafsma and Ovan Abdullah, a Dutch couple who purchased a one euro property in Ollolai, in the mountainous Barbagia region of the island of Sardinia, opened a “Sleep & Experience” boutique hotel called Amkina. Their three-bedroom house has been transformed into a Bed & Breakfast designed to showcase their fashion brand, which features influences from their Dutch and Kurdish backgrounds.

According to their website, guests are invited to not only spend the night but will also receive a clothing item designed by the pair. Graafsma and Abdullah have so far spent no less than 100,000 euros on their renovations, and charge between 80 and 100 euros per night to stay in one of their B&B rooms. Since its opening last month, their occupancy rates have been high and their two open rooms are mostly booked for the summer.

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