1. By Michele Vigne, Vice President of the UIPI and Vice President of the Confederazione Italiana della Proprietà Edilizia 41ST WORLD CONGRESS OF THE UIPI REPORT FROM ITALY VIENNA, 21 MAY 2011

2. CHARACTERISTICS OF THE HOUSE MARKET Italian real estate market suffered from international real estate crisis (USA subprime mortgage crisis). Increases in Italian house prices: - peaked in 2002: rising 12% (9,2% in real terms) from previous year. - rose by an average of 6,5% from 2003 to 2006, and by an average of 4,6% (2% in real terms) from 2007-2008.

3. Italian property market today characterised by general stability. However, new facts emerge from an analysis of the quality indicators, so “cautious optimism” for the future. In fact, compared to the last semesters, the market invariance evaluation in all its building components and types has increased.

4. Property values: stable and without substantial differences between one semester and another. 2010: - 617.286 residential transactions took place (+0,5% respect to 2009; +5,2% in the main cities). - 64.000.000 m² had been sold in 2010 (+1% respect to 2009).

5. Significant decrease in prices and a simultaneous downward trend of the interest rates for mortgages, combined with the lower inflation expectations and, above all, the difficult macroeconomic trend, have contributed to the slight decrease in the rental yields for all types of property.

6. NEW DEAL FOR ITALIAN HOUSES RENTAL MARKET Confedilizia dialogue with Italian Government (since 2003): to introduce a new taxation for house rental market. Confedilizia’s suggestion: introduction of a flat tax for rental market, so to reduce distortions in competition, strengthen market safety and security, enable all types of savers to invest in prime real estate everywhere, and promote international property investment in Italy.

7. There are two main types of leases. Free with a full and taxing one another, with rents of tenants agreed by unions and owners, with reduced fees of 30% approximately, over the free market. The Government has approved a flat tax of 19% or 21% for all owners and for all the residential leases, and property owners can now decide to pay their rental taxes with the old or with the new system. Confedilizia has won her battle, and a new deal for the house rental market has just been concluded in Italy.

8. NEW CHALLENGE: CONDOMINIUM LAW Italian Parliament now changing law to review condominium system. Confedilizia’s suggestion: introduce in Italy, as in most EU legal systems, the legal “capacity” of the Condominium (e.g. French Law n° 65-557/1965 art. 14): “la collectivité des copropriétaires est constitueé en un syndicat qui a la personnalité civile”). Confedilizia started this new campaign to reform effectively the Italian condominium system.

9. Confederazione Italiana della Proprietà Edilizia THANK YOU FOR YOUR ATTENTION!