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Bays of aquamarine waters and pristine white sand beaches reminiscent of the Caribbean persuaded Andrew Bignell and his wife Merlyn to buy a home in Sardinia two years ago.
The couple, from Essex in south-east England, bought a three-bedroom stone house near Porto Cervo on the Costa Smeralda for €970,000. “We’ve been all over Italy but kept being pulled back to the island, we love how calm and easy to get around it is,” says Andrew, who runs a brand consultancy. “We can imagine retiring there.”
The Costa Smeralda — or Emerald Coast — a 55km-long piece of coastline in north-east Sardinia, was developed by the billionaire spiritual leader Karim Aga Khan 60 years ago. The stretch between Pitrizza and Spiaggia Rena Bianca has been protected from overdevelopment by a non-profit consortium, the Consorzio, that includes the 3,800 owners of apartments and villas built there.
For years, this corner of Sardinia has been popular with wealthy Russians who have bought up some of the grandest villas along the coast — until, that is, the invasion of Ukraine.
Property buyers have been asking when the seized Russian-owned villas will be available for resale
Since the end of February, at least eight villas in the area have been frozen by the Italian government, including those linked to sanctioned oligarchs Alexei Mordashov and Alisher Usmanov, the latter of whom also had a bulletproof Mercedes worth €600,000 seized from Porto Cervo, according to reports in the Corriere della Sera newspaper.
Locals say Russian-owned superyachts are now noticeably absent from the marina at Porto Cervo, following at least a dozen seizures around Europe.
Property buyers have been asking when the seized Russian-owned villas will be available for resale, says Roberta Paterlini of estate agents Immobiliare Brunati Knight Frank. At present, they are being maintained by the Italian state. However, the consortium will neither confirm the number of such properties nor discuss their fate to protect their owners’ privacy.
Foreign buyers are steadily returning to the area, after being largely prevented from travel by Covid restrictions. In 2020, just 90 sales were completed on the Costa Smeralda, less than a third of the 312 sales recorded in 2019. Last year there were 137 sales; and, in the first six months of 2022, 82 properties have changed hands — one luxury villa sold to a Chinese buyer for €80mn, according to local press reports.
Paterlini has just sold two villas in Cala di Volpe bay for €13mn and €6.5mn. “Italian, French, Swiss and German buyers are the most active, and for the first year we have Americans viewing properties,” she says. “It’s now difficult to find villas in the popular €2mn-€5mn price band.”
Such a property — a four-bedroom villa on the hill near Hotel Cala di Volpe — was purchased by Dean Kronsbein from Ross-on-Wye, near England’s border with Wales, in 2020. “We’ve rented here every summer and I thought it a good time to buy,” says the manufacturing entrepreneur. He believes the best-located properties will increase in value because development is restricted. “The houses are built to blend into the hillsides and don’t stick out and spoil the landscape.”
For homebuyers, Paterlini says the most requested locations are Romazzino and Pitrizza bay (also known as Liscia di Vacca), but it’s easier to find a waterfront home on a large plot on Porto Rotondo, a privately owned enclave to the south.
Buyers who look beyond Costa Smeralda — which is busiest from July to September — tend to stay longer time and to seek a more ‘authentic’ Sardinia
The La Maddalena archipelago, a small cluster of islands off the island’s north coast, is perfect for exploring by small boat from Palau, says Giuseppe Verdoni, who owns a five-bedroom villa in nearby Porto Rafael, which he rents out. “The tourism season is longer there than in Porto Cervo [where businesses close outside of the summer],” he says, “Even in 2020 my bookings only fell by 30 per cent.”
An increase in visitors from the US is helping compensate for the lack of Russians, usually 20 per cent of the market, says Mario Ferraro, chief executive of Smeralda Holding, the company that owns most businesses on the Costa Smeralda.
“The season here is extending,” he says; “people are staying for longer and also remote working.” Ferraro says it’s now common to see people tapping away on their laptops in the bars of Porto Cervo’s five-star hotels. Across the island, every month since last November, short-term rental bookings have been higher than the corresponding month in 2019, according to AirDNA, which tracks the market.
Buyers who look beyond Costa Smeralda — which is most busy during July to September — typically spend a longer time on the island, and seek a more “authentic’” Sardinia, says Antonello Demuro, founder of Live In Sardinia, an agency that sells to 50/50 Italian and foreign buyers.
€780,000 A three-bedroom house in the village of Sant Pantaleo, north-east Sardinia. Through agents Live In Sardinia.
€8mn A five-bedroom villa near Porto Cervo marina. Through Italy Sotheby’s International Realty.
“Half an hour south on the west coast, the seaside village of Budoni is popular with German and UK buyers and the bohemian town of San Pantaleo is fashionable,” he says, but Italians still very much predominate, unlike the cosmopolitan Porto Cervo. He says the medieval city of Alghero in the north-west was popular with European buyers until Ryanair stopped flying there in 2016. With the airline resuming flights next month — and other new airline routes added — interest is returning.
The unchanging nature of small seaside villages keeps north London author and actress Sara Alexander visiting her family’s holiday home in Budoni, built in the 1980s. “The hills are dotted with a few more villas but the scent of wild fennel on peaceful hikes is the same every summer,” she says. “It’s a different version of Sardinia to the millionaires’ playground of Costa Smeralda.”
Purchase tax is based on a cadastral value and is 2 per cent for primary homes and 9 per cent for second homes.
The Italian high-net-worth flat tax regime is €100,000 per annum; in areas of low-density population in southern Italy (including Sardinia) there’s a flat tax regime for overseas retirees of 7 per cent.
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