1. 1 Permanent Committee on Cadastre in the European Union – PCC Gianni Guerrieri Director Real Estate Market Observatory and Appraisal Services Italian Experience of Real Estate Market Observatory Rome November 20, 2014

2. 2 The information can be classified in two groups : -Macroeconomics For controlling general macroeconomic conditions -Microeconomics For appraisal of real estate assets INFORMATION ON REAL ESTATE MARKET Rome November 20, 2014

3. 3 INFORMATION MACROECONOMICS Lack of macroeconomic indicators for the real estate market Indispensable information set for controlling general macroeconomic conditions -EUROSTAT (housing price index ) HOUSING PRICES ALONE ARE INSUFFICIENT INDICATORS OTHER STATISTICS AND INDICATORS ARE NECESSARY Rome November 20, 2014

4. 4 INFORMATION MACROECONOMICS  number of housing units bought and sold (new and existing);  amounts bought and sold (expressed in square meters);  existing housing stock;  relationship of the number of houses bought and sold to existing stock;  the number of purchasers and their main characteristics (age, gender, income and available housing stock);  type of financing, distinguishing amounts deriving from self-financing and those from debt, detailing the loans in terms of the type of collateral provided (purchased housing, other property, other collateral) and qualifying other forms of financing;  a similar set of indicators for the non-residential sector, particularly for the most common uses (shops, offices, industrial warehouses). Rome November 20, 2014

5. 5 INFORMATION MICROECONOMICS Appraisal of real estate assets - at the base of a pyramid which allows credit to be provided or allows the values ​ of assets in a real estate fund to be brought up to date Adequate information is necessary for appraising real estate with any given procedure. lack of information lack of transparency uncertain appraisals Increased risk (credit, real estate funds etc) Rome November 20, 2014

6. 6 INFORMATION MICROECONOMICS Needed information  Availability of data regarding real estate transactions in a given geographical area  Availability of transaction prices  Availability of rental costs  Availability of the technical characteristics of the property (area, building type, state of repair etc)  Availability of marginal prices of the different characteristics  Availability of legal information (planning constraints, liens etc) Rome November 20, 2014

7. 7 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY Real Estate Observatory of Agenzia delle Entrate Mission :  contribute to the transparency of the real estate market;  provide support for the Agency’s assessment activities;  improve cadastre and real property databases for statistical - informational purposes Rome November 20, 2014

8. 8 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY REAL ESTATE MARKET OBSERVATORY  production of statistics regarding the real estate market starting with the cadastre and real property and financial administration databases in general (started in 2001);  management of the real estate price database (launched on January 1, 2004) which required a gestation period of approximately three years for its design and testing. Rome November 20, 2014

9. 9 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY n Residential real estate report : geographical and sectorial analysis regarding number of residential units sold and distribution of housing stock, price indices, mortgages (annual) n Report on non-residential property : for the most important segments (shops, offices, warehouses (annual) nOnObservatory Database Handbook n Local reports : twice yearly analyses of 19 cities and their provinces Rome November 20, 2014 n Quarterly Notes : quarterly update of the number of property sales, mortgages and real estate prices (quarterly); n Banca d’Italia, Agenzia del Territorio, Tecnoborsa Survey (quarterly) n Cadastral Statistics : annual report on the real estate units surveyed by the cadastre

10. 10 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY Rome November 20, 2014

11. 11 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY The key steps in reaching these results are:  division of the cities into areas that are as homogeneous as possible in terms of the housing (or prevalent) market;  conducting the survey of economic data for individual real estate units;  processing of this data;  validation and publication. Rome November 20, 2014

12. 12 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY Rome November 20, 2014 Market Price: Transactions: Public Register Direct Information Estimated Market Price: Agency Estimates Offer Price: Real estate agencies Real Estate Publications Information providers: percentage contribution

13. 13 ITALIAN EXPERIENCE: REAL ESTATE MARKET OBSERVATORY Rome November 20, 2014 Market Price: Transactions Direct Information Estimated Market Price: Agency Estimates Offer Price: Real estate agencies Real Estate Publications Number of observations: - 2013 year Total = 80.951

14. 14 In the future…. a)reinforce the availability and accessibility of economic information of real estate market observatory b)draw up a new Report on number of rents and on price of rents c)Draw up a new Report on mortgages for purchasers of real property or for those to raise funds for any purpose d)Draw up a new Report on agricultural farmland bought and sold Rome November 20, 2014

15. 15 IN CONCLUSION… Verify the level of information that the management bodies of administrative real estate data - such as the Cadastre or the Real Estate Registries – are able to generate for the transparency of the real estate market. The European statistical system could ensure the collection and availability of this information. Discuss the necessary minimal conditions for the availability of information that can render the principles of appraisal practice operationally concrete and for improved data rents and values of the cadastre. Rome November 20, 2014