Life of Italian nobility for sale

Nestled on a gentle Tuscan hill near this town just west of Florence, and caressed by the morning fog, sits a medieval castle that was once home to the few prominent noble families who plotted against the Medicis’ rule during the Renaissance, some of whom are believed to have taken refuge here. For centuries after, the descendants of the nobles and the peasants who served them lived sheltered by the fortress’ creneled walls or in the nearby country houses, and went to Mass in a rose stone church.

“I remember a procession of over 25 farmers’ families to the Sunday’s Mass here up until the late 1960s,” said Franco Viliani, 80, a former manager of the estate. “It might sound strange for a pseudo-feudal system, but that was a form of inclusion. Afterwards, we have seen some owners once or twice a year.”

Today, the entire estate is deserted and up for sale, castle, church and all. While that might seem an exceptional circumstance, increasingly for Italy, it is not. While castles and historic mansions in Italy have long been family inheritances, today, dozens of them are for sale, even in one of the most conservative real estate markets in Europe. In recent years, Italy’s well-rooted inherited wealth has withered from a potent combination of factors. They include the increasing costs of living and services, the shaky finances of owners in a time of lingering economic trouble, cuts in government subsidies to maintain historical properties and, not least, mushrooming property taxes.

“The Italian market is mostly historical - mansions pass from generation to generation,” said Dimitri Corti, chief executive officer at Lionard, an exclusive real estate company based in Florence whose portfolio boasts about 70 castles located in central and northern Italy. “It is not necessarily true that the owner is a millionaire like one can assume in countries like the United States or England,” he added. “Some do need liquidity.”

Moreover, those with the money to buy are frequently not Italians, a worrisome circumstance to some here who bemoan the loss of historical and family patrimony to a newly moneyed global elite. The bulk of Lionard’s sellers are Italians, Corti said, while the majority of buyers are foreigners. They predominantly seek villas or mansions in Tuscany, and are ready to spend an average of 6 or 7 million euros (about $6.75 million to $7.85 million).

“It is no longer reasonable to think that the owner of a neighbouring castle would buy yours,” Corti added. “It’s most likely to be a Russian, or a Chinese.” Indeed, more than 50 per cent of Lionard’s clients come from Russia and the former Soviet Union, while the rest mostly live in North America. Other luxury realtors, like Sotheby’s Italian branch, have a more diverse clientele, ranging from the Arab countries to China, Russia and North America.

“No historical owners would like to get rid of their properties, but they might be in the condition to do it,” Moroello Diaz della Vittoria Pallavicini, president of the Italian Historic Houses Association, said in his vaulted office located in a 17th-century complex on the Quirinal hill in central Rome. “And we fear that foreigners will be less attached and caring of their property,” he added. “They didn’t grow up there; that mansion doesn’t belong to their family’s history.”

Despite relatively low incomes, Italians have historically inherited properties and benefited from low property taxes, helping them to afford their housing, or to invest in more real estate. In 2011, as the financial crisis deepened and the government came under pressure to balance its books, the technocratic prime minister, Mario Monti, raised property taxes and started a review of the land register’s assessment of home values.

On historic buildings, where owners used to pay little as compensation for the elevated costs of maintaining centuries-old structures, the taxes increased by 20 or 30 times, depending on the property’s location. On some buildings, taxes spiked from 3,000 euros (about $3,400) in 2011 to 75,000 euros (about $84,000) by 2013. That might be a small figure for castle dwellers in the United Kingdom, but a burden for Italian pockets, especially in regions where the property’s market value or tourism interest is low.

The trends, to many here, are indicative of Italy’s place as a country caught between its past glory and its modern difficulty in producing an innovative climate capable of ensuring its future. Landowners’ attempts to navigate the changes have often fallen short. Some Italian owners who bought properties as an investment transformed them into luxury hotels, hoping to offset the steep costs of maintaining ancient frescoed walls and immense Italian gardens, often including acres of olives groves and vineyards. Yet, demand for luxurious holidays has not boomed in recent years, and some resorts have registered few guests.

Once, the 4,600 square feet on five floors of the Tavolese castle, about 19 miles south of Florence, housed the noble Uberti family, mentioned in Dante’s “Divine Comedy,” and then the Canigiani family, whose daughter Elena gave birth to the illustrious Renaissance poet Francesco Petrarch.

The 14th-century castle was turned into a lavish bed and breakfast and wedding venue. But today the fruits of the estate’s 5,000 olive trees have not been picked for years, and the newlyweds’ bed from last summer remains unmade. Buyers can make it theirs for 18 million euros (just over $20 million).

Buyers beware

Living a nobleman’s life in Italy comes at a cost, even for many tycoons. New owners face the same onerous bureaucracy as Italians to make even minimal changes to many older properties. Under Italian law, the owner of a historic building is its custodian, bound to maintain it and grant its security and, in some cases, its use to the public. Many buyers give up on properties of great historic value, but in bad condition, for this reason, brokers said.
“This is a problem for possible investors, who want to have modern comforts like a spa, air-conditioning, or a lift,” said Pallavicini, of the Italian Historic Houses Association. “We no longer live like in 1800,” he added. “But 99 per cent of those changes are either impossible or extremely bureaucratic and complicated in an Italian historic building.”
At the same time, many of the association’s 5,500 members would prefer never to sell their property, he said. “They have an umbilical cord to that building,” he said. “They were maybe raised there. Selling is not an option, as long as they can resist.” But while selling may be hard to swallow, too often the only other option is abandonment, especially for castles and monuments not located in tourist regions.

“If a Tuscan owner who sells his mansion can hope in a Russian, British or American buyer to restore his family’s finances, we can’t,” said Francesco Scardaccione, owner of a historic palazzo and two country estates who is president of the Italian Historic Houses Association branch in the southern region of Basilicata. “What is going to happen,” he asked, “the day we will no longer be able to afford it?”