What Awaits Real Estate Buyers in Italy in 2025

29.09.2024

28.04.2025

In 2025, the Italian real estate market is expected to continue stabilizing after the COVID-19 pandemic-driven boom. During 2024, sales activity normalized, but demand still outpaces supply in key cities like Milan and Rome. High interest rates, which slowed mortgage lending, may decrease this year, leading to increased buyer activity.

Property prices are expected to rise at a more moderate pace, particularly in popular destinations for expats, tourists, and entrepreneurs. Analysts predict property prices in Milan will increase by 6.9%, while in Rome, they are expected to rise by 6%.

These trends align with growing demand for housing in metropolitan areas that attract buyers with a high quality of life and economic opportunities. Currently, the average price per square meter in Milan is €4,300, while in Rome, it is €3,800.

Key Trends for Italy's Real Estate Market in 2025

Decline in Mid-Range Property Demand:
The mid-range property sector is expected to see a slight decline as buyers shift their focus to luxury or budget housing. Rising interest rates have made high-end properties more appealing to affluent investors, while first-time buyers concentrate on more affordable options. This trend highlights an increasing wealth gap and changing buyer priorities.
Growing Demand for Sustainable Properties:
Foreign buyers are increasingly seeking eco-friendly, energy-efficient properties. Government incentives, such as the Superbonus 110%, make “green” real estate more attractive.
Increased Demand for Rental Properties Among Students:
An influx of international students, particularly in cities like Milan, has led to a sharp increase in demand for rental properties. Investors owning housing in these areas can benefit from the growing rental market.
Rising Demand for Home Offices:
The number of remote workers in Italy reached 82% in 2023, driving demand for housing with office spaces. As home offices become essential, properties with extra rooms or dedicated workspaces will remain in high demand.