The Italian housing system and the global financial crisis

The paper describes the main features of the Italian housing system and the relatively recent changes toward a more market-driven model and their respective critical elements. It also provides an analysis of the effects of the current global financial crisis (GFC) on this system and discusses how the government, market actors, and households are dealing with it. In comparative terms, the impact of the credit crunch has been softened by the crucial role traditionally played by the family in funding home ownership and by certain policy measures. But the GFC has led to further cuts in housing policy and to diminished economic capacity among households. Affordability was a severe problem even before the GFC, especially in the rental sector. Social housing is now collapsing, and there is a great deal of uncertainty about the future of new programs under development just before the crisis.