Verona, 20 January 2020 - Investments in construction are growing in the two-year period 2020-'21, albeit at a slower pace than in 2019. In 2018 the overall value in Italy had exceeded 139 billion euros and now the 2019 closing forecasts speak a further increase of 3.3%, equal to about 4.5 billion euros: numbers destined to increase also in the following two years, with an expected growth of 2.5 billion in 2020 (+ 1.8%) and 2 , 4 billion in 2021 (+ 1.7%).
These are the updated estimates of the SaMoTer-Prometeia Observatory, which drew up the Building Monitor - December 2019. A quarterly survey on the performance of the sector that SaMoTer, the international construction machinery exhibition (Veronafiere, 21-25 March 2020), puts available to companies to help them interpret market developments.
Irregular building performance in the first three quarters of 2019
After strong growth in the first three months of 2019, the market witnessed a retreat in the second quarter and a subsequent, modest, recovery in the third (+ 0.2%), thanks in particular to the residential sector. Despite this weak performance in the second and third quarters, overall the estimated growth in the average of 2019 for construction investments is confirmed (+ 3.3%), due to the robust expansion recorded in the first three months of the year.
The residential buildings are mainly supported by investments for the renewal of the housing stock, linked to the requalification needs, as well as to the advantages deriving from tax incentives. The component of new housing was less incisive, due to the drop in building permits in the first quarter of 2019, which indicates a slight decrease in trend terms (-0.9%).
Positive trend for the real estate market
In the third quarter, the positive trend of sales in the residential market has continued, which has been going on almost continuously since 2014, with a pace (5%) higher than that recorded in the previous period. In the non-residential market, however, the trends are diversified: while the tertiary-commercial segment is experiencing strong growth (+ 7.4% compared to the previous quarters), the productive one continues the negative trend (-0.9%).
Despite this context of general recovery in sales, house prices have not yet reached a complete stabilization, recording a further slight decrease in the second quarter (-0.2%), in particular for existing homes, against a increase in the new segment.
Signs of recovery for public administration capital expenditure
The trend of gross fixed investments of the public administration during 2019 showed a recovery in spending activity, with a nominal growth of 6.9% in the first half, supported by the numerous interventions put in place in recent years to revive the public investment. In particular, there is a restart of investments by local administrations, which can benefit from the new public finance rules, starting from the release of the budget surpluses for the construction of public works.
The public works market confirmed the positive trend underway since 2017: the first nine months of 2019 were characterized by a tendential increase (+ 4.7%) in the number of tenders published and by a more consistent growth (+ 25.1%) of the tender amounts.
Expansive, but decelerating, profile in the two-year forecast
The outlook for the 2020-2021 period remains positive, allowing construction investments to continue to grow, albeit at a slower pace than in 2019. The slowdown will affect all business sectors, with the exception of civil engineering, from which is expected to have strong and lasting growth. It will be driven by the huge public resources made available in the 2016-2019 period, as well as the funds allocated by the Budget Law 2020 to the various central and territorial administrations, to carry out various types of public works or maintenance interventions oriented to safety and sustainability .
Residential construction is also expected to grow in the two-year period 2020-1921, but at a more moderate pace than in 2018-1919. The progressive reduction of the unsold stock will continue to support the recovery of investments in new homes: a further positive trend is expected for the renewal sector, supported by the extension to 2020 of tax breaks for building recovery and energy requalification and by their enhancement through the introduction of the so-called "facade bonus".
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