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Thinking about buying a 3-bedroom apartment in Trastevere? It’s a great area, but you're probably wondering: is now the right time to buy, or should you wait for prices to drop?
And what about long-term investment—should you look into other neighborhoods like Prati or Testaccio where property values might appreciate more over time?
In this article, we’ll answer these questions. We know this market quite well - and we have put all our knowledge in the Italy Property Pack.
Will property prices increase in Italy in 2025?
No, property prices in Italy are not expected to rise significantly in 2025, due to a combination of economic challenges and market dynamics.
Backed by our fresh, in-depth market analysis, we’re observing a cautious outlook for Italy's real estate market, with several factors potentially hindering price growth.
While there are some positive indicators like tourism recovery and urban development projects, the overall economic environment and demographic trends present significant hurdles.
Italy's aging population and slow economic growth are key factors that could dampen demand, while rising interest rates and inflationary pressures add further challenges to the market.
Signals pointing to a property price increase in Italy
Here are some factors suggesting prices could increase:
The recovery of the tourism sector post-pandemic is expected to boost demand for short-term rental properties, particularly in popular tourist destinations like Rome, Florence, and Venice, potentially driving up prices in these areas.
Urban development projects and infrastructure improvements in major cities are likely to enhance property values, as improved amenities and connectivity attract more buyers and investors.
Government incentives for energy-efficient renovations and sustainable building practices could increase the value of upgraded properties, contributing to a rise in overall market prices.
Signals pointing to a property price decrease in Italy
Here are some factors suggesting prices could fall:
Italy's aging population and low birth rates are leading to a shrinking domestic market for property, reducing long-term demand and potentially putting downward pressure on prices.
Economic growth in Italy remains sluggish, with high public debt levels and structural challenges limiting the country's economic prospects, which could negatively impact the real estate market.
Rising interest rates across Europe are making mortgages more expensive, which could deter potential buyers and reduce demand for property purchases.
Inflationary pressures are increasing the cost of living, which may lead to reduced disposable income for potential homebuyers, further dampening demand.
The ongoing uncertainty in the global economy, including potential geopolitical tensions, could lead to cautious investor sentiment, affecting the real estate market negatively.
A potential oversupply of properties in certain regions, particularly in less economically vibrant areas, could lead to price stagnation or declines.
The slow pace of digital transformation and innovation in Italy's real estate sector may hinder its ability to attract tech-savvy investors and buyers, limiting market growth.
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If property prices go up in Italy, how much would they increase by?
If real estate prices in Italy were to rise in 2025, the increase would likely be around 2% to 4% of their 2024 values.
Typically, real estate in stable, mature markets like Italy appreciates by approximately 2% to 4% annually over the long term. However, fluctuations can occur depending on factors such as region, season, and property type.
It means that, if you spot a charming 2-bedroom apartment in Rome for 300,000 euros today, don't be surprised if it's priced between 306,000 and 312,000 euros this time next year.
To give you a better understanding, here is a table that shows 7 types of Italian real estate properties, their estimated prices in 2024, and projections for 2025 based on potential price increases of 2%, 3%, and 4%.
| Type of Property | Average Price in 2024 (€) | Price in 2025 (2% increase) | Price in 2025 (3% increase) | Price in 2025 (4% increase) |
|---|---|---|---|---|
| Historic Apartment (60 sqm / 646 sqft) | €300,000 | €306,000 | €309,000 | €312,000 |
| Modern Apartment (75 sqm / 807 sqft) | €400,000 | €408,000 | €412,000 | €416,000 |
| Luxury Villa (100 sqm / 1,076 sqft) | €1,000,000 | €1,020,000 | €1,030,000 | €1,040,000 |
| Studio (30 sqm / 323 sqft) | €150,000 | €153,000 | €154,500 | €156,000 |
| Loft (80 sqm / 861 sqft) | €500,000 | €510,000 | €515,000 | €520,000 |
| Country House (150 sqm / 1,615 sqft) | €800,000 | €816,000 | €824,000 | €832,000 |
| Investment Property (50 sqm / 538 sqft) | €250,000 | €255,000 | €257,500 | €260,000 |
Everything you need to know is included in our Property Pack for Italy
If real estate prices go up in Italy, which areas are likely to see the biggest increases?
Today, people who want to move to Italy want the charm, but they also want modern conveniences and vibrant social scenes, which Trastevere in Rome delivers. Hence, we could see a price increase there in 2025.
Also, lately, there's been a shift toward more youthful, vibrant neighborhoods, and Brera in Milan has really taken off.
We like it when information is clear and easy to digest. So, here’s a table that highlights the areas where prices might rise the most, along with the reasons behind those expected increases. It’s very high-level. If you want more details on a specific area, please check our real estate pack tailored to the Italian market.
| Neighborhood | Level of Increase | Why |
|---|---|---|
| Trastevere, Rome | High | Recent development of luxury housing projects and its increasing appeal to international buyers as travel normalizes post-pandemic, driving demand. |
| Brera, Milan | High | Expected rise due to limited housing stock, upcoming renovations to heritage buildings, and growing demand for prime properties in central Milan. |
| San Lorenzo, Rome | Medium-High | Ongoing gentrification and new transport links, along with several planned redevelopment projects in the area, are likely to push prices higher. |
| EUR, Rome | Medium | The shift towards hybrid workspaces is driving demand for residential properties near business districts, combined with new mixed-use developments. |
| Navigli, Milan | Medium-High | Eco-friendly urban projects and recent construction of new schools and parks are increasing its attractiveness for families, pushing prices upward. |
| Centro Storico, Florence | Medium | Investment in local infrastructure, such as the extension of tram lines and renovation of historic areas, is boosting long-term value. |
| Quadrilatero della Moda, Milan | Medium-High | With new cultural and commercial spaces being developed, this trendy neighborhood is seeing increased demand from both residents and investors. |
| Testaccio, Rome | High | Upcoming large-scale urban regeneration projects and improved public transport access are expected to make this area more desirable. |
| Porta Nuova, Milan | Medium-High | Its proximity to Milan's city center, along with new office and residential developments, makes it increasingly attractive to professionals seeking more space. |
| San Frediano, Florence | Medium | Gentrification and cultural regeneration projects are attracting new residents, leading to rising prices as the area becomes more fashionable. |
| Posillipo, Naples | High | As new luxury developments are launched, demand for premium housing among wealthy buyers is expected to further increase property values. |
| Centro Storico, Rome | High | Upcoming restoration of historic sites and high-profile cultural projects are driving a renewed focus on this central, historic location. |
If I'm looking to invest in real estate, what types of properties should I focus on for the best value appreciation in Italy?
In 2025, Italian real estate trends focus on tech-smart, energy-efficient apartments, larger suburban homes for families, properties with outdoor spaces, and eco-friendly buildings—all driving higher demand and prices. Here is a summary.
- Tech-Equipped and Energy-Efficient Apartments:
Driven by remote work and sustainability trends, these homes offer smart technology features and energy-saving systems. They cater to young professionals and tech workers, making them a hot commodity in 2025, especially in cities like Milan and Rome.
- Family-Sized Apartments in Suburban Areas:
With a growing demand for larger living spaces, especially among families, suburban areas near major Italian cities like Florence and Turin are seeing increased interest. Proximity to green spaces and schools is a major factor driving value.
- Properties with Outdoor Spaces:
Post-pandemic, outdoor spaces like terraces, balconies, or gardens have become highly desirable. In dense cities like Rome and Naples, these features offer a much-needed escape and are likely to drive up property values.
- Eco-Friendly Buildings with Low Carbon Footprints:
Italy's commitment to sustainability is boosting demand for eco-certified buildings. Buyers are increasingly valuing properties that align with the country’s green goals, leading to price appreciation in this category, particularly in eco-conscious cities like Bologna.
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