Italy’s Case 1 Euro Program: a Policy Solution for Rural Communities in America?

Across Italy, young Italians migrate from the countryside to urban centers in search of more lucrative job markets, forcing rural towns to struggle with the repercussions of a decades-long depopulation trend.[1] Now, municipalities must strategize to address the abandoned and often derelict buildings people are leaving behind, while also tackling the root cause—depopulation.[2]

In 2017, Vittorio Sgarbi, mayor of Salemi and TV personality, launched a new program called “Case 1 Euro” to save Salemi’s crumbling historic district.[3] These prices of just €1 generated international interest for real estate in otherwise largely unknown, remote Italian villages.[4] Eventually over 34 municipalities across Italy launched their own programs.[5]

Italian law creates a legal duty for property owners to maintain the property to prevent damage to third parties, so local mayors are undaunted by claims from abroad that these sales are landgrabs.[6] Homeowners must either pay for renovations (and backed taxes) or surrender their property, with at least one mayor promising to seize properties if original owners do not respond with a detailed plan for renovations within a reasonable timeframe.[7]

Rural America is facing similar challenges with depopulation and rural blight.[8] Given the dramatic success of the Case 1 Euro program, American municipalities could consider implementing a similar program to attract new homebuyers that could add to the tax base, stimulate local economies, and thereby address common challenges facing rural communities in both countries.[9]

Despite the obvious similarities between the challenges both American and Italian rural municipalities face, a similar solution, an Americanized Case 1 Euro program, would encounter significant hurdles. The primary problem concerns the supply of nearly valueless homes for the municipality to resell. Unlike elderly Italians, residents of blighted properties have financial incentive not to surrender them to the government.[10]  Namely, American agricultural policies like biofuel incentives and subsidized crop insurance drive up the price of land such that some farm land values have increased at twice the rate as the Dow Jones Industrial Average.[11] Moreover, voters in American rural areas prefer small governments, so a large, expensive program to buy up land could be politically unwise.[12] This propensity is compounded by court decisions which have low tolerance for public intrusion on rural land, which some legal scholars posit is premised on misguided beliefs about rural life, including that rural property owners are self-sufficient, with less need for government protection.[13]

In response to these challenges, some municipalities are experimenting with Home Rule programs.[14] Home Rule gives each level of government a separate realm of authority, functionally expanding the authority of local governments in particular areas.[15] Under these programs, local governments enforcing nuisance codes could do so without regard to state laws, rules, and regulations.[16] This may allow rural municipalities with a limited capacity the flexibility to streamline the process of ultimately seizing abandoned properties for use in a Case 1 Euro-style program.[17]

Other municipalities are exploring conservatorship, which could provide individuals legal recourse to sue the owners of blighted property.[18] To this end, the Pennsylvania Abandoned and Blighted Property Conservatorship Act provides community members legal standing to seek a custodial role over the blighted property, and, should the owner not complete the rehabilitation plan, allow the conservator to foreclose on the property.[19] Perhaps this approach would cause more homes to enter the market, particularly if conservators could be compelled to sell the land as part of the program. However, Italy’s program not only increased supply of homes, but propelled demand by dropping prices.[20] Given the factors overinflating the price of land described above, it seems unlikely that conservators, having surmounted the legal hurdles to acquire the property, would abruptly part with the property at similar prices.

Ultimately, implementing Italy’s Case 1 Euro program in the US would only be possible with significant legal and cultural change.

[1] Lucy Thackray, Italy’s One Euro Houses: Who Can Buy One And How Does It Work?, The Indep.(Jan. 20, 2022), https://www.independent.co.uk/travel/news-and-advice/italy-one-euro-homes-buy-house-b1996970.html.

[2] Joey Tyson, What It’s Really Like to Buy One of Italy’s Super-Cheap Homes, The Indep. (Apr. 13, 2022), https://www.independent.co.uk/travel/europe/italy-one-euro-homes-buyer-cheap-houses-b2054084.html; Abby Narishkin & Steve Cameron, The True Cost Behind Italy’s $1 Homes, Bus. Insider (Aug. 4, 20202), https://www.businessinsider.com/true-cost-of-italys-one-dollar-homes-sambuca-mussomeli-2020-3; Lorenzo Poggioreale Nuova, 50 Years Since Sicily’s Earthquake, An Urban Disaster of a Different Kind, The Guardian (Jan. 15, 2018), https://www.theguardian.com/cities/2018/jan/15/sicily-earthquake-1968-50-years-belice-valley-poggioreale.

[3] Harrison Jacobs, They Bought Houses in Italy For 1 Euro — And Are Using Them to Give Back to the Community, The Washington Post (Nov. 15, 2021), https://www.washingtonpost.com/travel/2021/11/15/italy-1-euro-houses-mussomeli-sambuca/.

[4] Rebecca Ann Hughes, Italy’s Bargain €1 Homes Are Back With Even Better Deals, Forbes (Jan. 26, 2021), https://www.forbes.com/sites/rebeccahughes/2021/01/26/italys-bargain-1-homes-are-back-with-even-better-deals/?sh=3f25bdea5398.

[5] See Jacobs, supra note 3.

[6] Silvia Marchetti, Why Not Everyone is Happy with Italy’s €1 Homes Bonanza, CNN TRAVEL (Feb. 27, 2021), https://www.cnn.com/travel/article/italy-one-euro-bonanza-challenge-intl/index.html.

[7] Silvia Marchetti, €1 Homes Go On Sale in One of Italy’s Best-kept Secrets, CNN Travel (Oct. 12, 2021), https://www.cnn.com/travel/article/italy-one-euro-houses-pratola-peligna-abruzzo/index.html.

[8] Jessica A. Shoemaker, Fee Simple Failures: Rural Landscapes and Race, 119 Mich. L. Rev. 1695, 1700 (2021); see Patrick J. Carr, Daniel T. Lichter, & Maria J. Kefalas, Can Immigration Save Small-Town America? Hispanic Boomtowns and the Uneasy Path to Renewal, 641 Annals of the Am. Acad. of Pol. and Soc. Sci. 38, 39 (2012).

[9] See Patrick J. Carr, Daniel T. Lichter, & Maria J. Kefalas, Can Immigration Save Small-Town America? Hispanic Boomtowns and the Uneasy Path to Renewal, 641 Annals of the Am. Acad. of Pol. & Soc. Sci. 38, 42 (2012).

[10] See Shoemaker, supra note 8 at 1739; Thackray, supra note 1.

[11] Shoemaker, supra note 8, at 1732.

[12] Ross Benes, Taking Back Rural America, The Am. Prospect (Jan. 21, 2020), https://prospect.org/politics/taking-back-rural-america/.

[13] Ann M. Eisenberg, Rural Blight, 13 HARV. L. & POL’y REV. 187, 205 (2018).

[14] West Virginia University, Municipal Home Rule Pilot Program, WV Leap (2022), https://wvleap.wvu.edu/special-considerations/municipal-home-rule-pilot-program.

[15] Travis Moore, Dillon Rule and Home Rule: Principles of Local Governance, LRO Snapshot (Feb. 2020),  https://nebraskalegislature.gov/pdf/reports/research/snapshot_localgov_2020.pdf.

[16] See Performance Evaluation & Rsch. Div., W. Va. Leg. Auditor, Spec. Rep.: Municipal Home Rule Pilot Program, PE 12-14-525, at 5 (W.Va. 2012).

[17] See id.

[18] Jackson Erpenbach, A Practitioner’s Guide to Addressing Rural Blight, 2020 JOTWELL: J. Things We Like 1, 1-2 (2020).

[19] Id.

[20] See Hughes, supra note 4.