Italian Nude Sales Increase

Elderly Italian property owners are increasingly turning to a form of property sale known as a ‘nude sale’ to help them through the worst recession since 1975.

Nude sales are when an elderly person sells their family home, normally to a stranger and at a significant discount, on the condition that they are permitted to live in the property until they die. The purchaser also normally pays cash for the property. These sorts of property sales are known as ‘nude sales’ because the property owner is totally stripped of ownership of the house.

Currently, nude sales only account for around five percent of all Italian property transactions however as the economic crisis deepens, it is predicted that this desperate form of property sale will start to make up a larger percentage of property transactions.

The figures show that nude sales are already increasing – in 2000, there were around 18,000 nude sales; In 2008, this figure had increase to 40,000 sales. Around 85% of Italians over 65 are thought to own their own homes so there is massive potential for nude real estate sales to continue to rise.

Nude sales represent a risk for the property investor purchasing the property – the value that they pay for the house is determined by the life expectancy of the current owner. The older the current home owner, the closer the property will be to the current market rate of the property. This means that if a purchaser buys a house and the person dies relatively quickly, not only will they have bought a house at significantly under market value, but they will also be able to move in more quickly. However if the vendor lives for significantly longer than expected, it can be years before the property purchaser can do anything with the property.

History provides us with an interesting lesson in the risk of nude sales here. According to the Move Channel, in 1965 French lawyer Andre-Francois Raffray entered into a nude sale with 90 year old Jeanne Calment. Raffray expected to move into the apartment with his family in the coming few years.

Unfortunately for Raffray, Calment went on to live for a further 32 years – and in doing so became the oldest living woman in history – dying in 1997 at the age of 122. By the time she passed away, Raffray had been dead for two years and had never gotten to live in his apartment.

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