An Assessment Methodology for the Evaluation of the Impacts of the COVID-19 Pandemic on the Italian Housing Market Demand

Francesco Tajani,Rossana Ranieri,Felicia Di Liddo,Maria Rosaria Guarini,Debora Anelli

doi:10.3390/buildings11120592

Francesco Tajani, Rossana Ranieri + Show 3 more

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https://doi.org/10.3390/buildings11120592

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Abstract

Due to the forced changes that the COVID-19 pandemic has had in many aspects of ordinary life (working, social life, training and learning in schools etc.), the characteristics of domestic spaces have significantly modified buying, selling and renting decisions in the real estate market. The aim of this research was to structure a methodology, articulated into four steps, to assess the variation that has occurred in residential market demand as a result of COVID-19 anti-contagion measures, with regard to six metropolitan Italian cities. We considered two samples of properties for each city, the first referencing the pre-COVID-19 pandemic spread and the second collected in the current situation. Consequently, we were able to determine variations in residential market appreciations through the application of a regressive econometric technique. The obtained results highlighted the relevance assumed by indoor acoustic and thermal comfort property factors, compared with the pre-COVID-19 condition. The proposed methodology could be useful to support the public and private entities involved in urban investment decision-making processes, allowing us to identify the most appreciated factors of the residential real estate market demand, in order to improve the conditions of existing and future assets and reduce the related risk levels.

Highlights

Starting in the first half of 2019, the COVID-19 pandemic has spread rapidly worldwide and, in order to minimize contagion, governments have applied many of measures that, most of all, have forced people to stay at home
Domestic spaces that previously performed a certain number of functions, strictly related to the ordinary daily activities of people before the restrictive measures of COVID-19, had to welcome new ones, often proving to be inadequate
The lowest root mean square error (RMSE) concerned the city of Florence (3.58%) and the highest referred to the city Milan (4.51%); the lowest mean absolute percentage error (MAPE) was calculated for the Rome study sample (2.80%), and the highest

Summary

Introduction

Starting in the first half of 2019, the COVID-19 pandemic has spread rapidly worldwide and, in order to minimize contagion, governments have applied many of measures that, most of all, have forced people to stay at home This has changed the shape of ordinary lives, requiring people to continue some activities in the domestic space [1,2,3]. Domestic spaces that previously performed a certain number of functions, strictly related to the ordinary daily activities of people before the restrictive measures of COVID-19, had to welcome new ones, often proving to be inadequate Spaces such as balconies or terraces, not always present in all types of residential buildings, have been found to be essential for many reasons—from those relating to mental and physical health to those associated with domestic activities—when the anti-contagion measures were very restrictive (i.e., in lockdown). According to a recent Forbes analysis in America, “the hottest housing markets in the new landscape are cities which offer desirable amenities—larger homes, leafy neighborhoods, access to the outdoors, walkability and proximity to grocery stores—in a more affordable package, and home buyers still want to be within commuting distance of large employment centers, but with the prevalence of remote work, they are willing to extend the distance from urban downtowns” [7]

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