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Everything you need to know before buying real estate is included in our Italy Property Pack
Are you curious about where Italian housing prices are heading in 2026 and beyond?
In this blog post, we cover everything from the current average property prices in Italy to detailed forecasts for the next 5 and 10 years, and we constantly update this article with the freshest data available.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Italy.
Insights
- The gap between Italian asking prices (around €1,880/m²) and actual transaction prices (around €1,750/m²) is about 7%, meaning buyers in Italy still have negotiation room in 2026.
- Milan's Centro Storico saw asking prices jump by 10.3% year-on-year in late 2025, making it Italy's fastest-rising neighborhood among major cities.
- Italy's mortgage rates dropped from 4.8% in 2023 to around 3.5% in late 2025, triggering an 18% surge in mortgage applications in Q3 2025.
- Property research firm Scenari Immobiliari predicts over 800,000 residential sales in Italy in 2026, a significant increase from recent years.
- Short-term rental prices near Milan's 2026 Winter Olympics venues have surged 144% compared to normal weeks, signaling intense demand pressure.
- Energy-efficient homes in Italy now command a 15% to 20% premium over equivalent unrenovated properties, driven by EU energy mandates.
- Bologna's rental prices increased by 8.2% in 2024 alone, making it one of Italy's most resilient investment markets thanks to strong university demand.
- Trentino-Alto Adige leads Italian regions with 7% annual price growth, fueled by Alpine tourism appeal and proximity to the 2026 Winter Olympics.
- Italy's housing stock available for sale dropped 4% in 2024 and continues shrinking, which explains why sellers now offer smaller discounts.
What are the current property price trends in Italy as of 2026?
What is the average house price in Italy as of 2026?
As of early 2026, the estimated average house price in Italy for a typical 90 square meter home is around €158,000 (approximately $165,000 or £130,000) based on transaction data, though asking prices suggest a slightly higher figure of about €169,000.
Looking at price per square meter, which is the standard way properties are valued in Italy, the average asking price sits at approximately €1,880/m² while actual transaction prices average around €1,750/m² after accounting for the typical 7% negotiation discount that Italian buyers secure.
The realistic price range covering roughly 80% of property purchases in Italy stretches from about €1,200/m² in regions like Calabria and Molise to over €5,000/m² in prime Milan neighborhoods, reflecting the country's dramatic regional price variations that can make the national average feel somewhat abstract.
How much have property prices increased in Italy over the past 12 months?
Property prices in Italy increased by an estimated 3.5% to 4% over the past 12 months through January 2026, based on official transaction data from ISTAT's House Price Index.
The range of price increases varies significantly by location, with Milan recording around 2.3% growth in asking prices while Rome saw approximately 7% growth, and some individual neighborhoods like Florence's Gavinana-Galluzzo district jumped nearly 15% year-on-year.
The single most significant factor driving this price movement in Italy has been the tight supply in desirable areas combined with improving mortgage conditions, as interest rates fell from their 2023 peak and the typical discount on asking prices shrank from 10% to about 7%.
Which neighborhoods have the fastest rising property prices in Italy as of 2026?
As of early 2026, the top three neighborhoods with the fastest rising property prices in Italy are Florence's Gavinana-Galluzzo (+14.9% year-on-year), Bologna's San Donato-Fiera (+11.8%), and Milan's Centro Storico (+10.3%).
These annual price growth percentages represent asking price momentum, with Bologna's Santa Viola following at +10.1%, Naples' Poggioreale-Vicaria at +9.3%, and Rome's Parioli and Prenestino districts both exceeding 8% growth.
The main demand driver explaining why these neighborhoods are experiencing the fastest price growth is the combination of constrained supply in historic centers, strong rental demand from students and professionals, and proximity to major employment hubs or transport infrastructure improvements.
By the way, you will find much more detailed price ranges across neighborhoods in our property pack covering the real estate market in Italy.
We have made this infographic to give you a quick and clear snapshot of the property market in Italy. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
Which property types are increasing faster in value in Italy as of 2026?
As of early 2026, the ranking of property types by value appreciation in Italy places renovated, energy-efficient apartments first, followed by townhouses in commuter belts, smaller apartments in major city centers, and finally unrenovated or rural properties which are growing slowest.
The top-performing property type, energy-efficient renovated apartments, is seeing appreciation of approximately 4% to 6% annually in strong markets, with some premium new-build developments commanding 15% to 20% higher prices than equivalent unrenovated stock.
The main reason this property type is outperforming others in Italy is the structural scarcity of move-in-ready homes in a country where much of the housing stock is old and in need of costly energy upgrades, combined with EU energy efficiency mandates that are making buyers prioritize homes with better energy ratings.
Finally, if you're interested in a specific property type, you will find our latest analyses here:
What is driving property prices up or down in Italy as of 2026?
As of early 2026, the top three factors driving property prices in Italy are limited housing supply in major cities, improved mortgage affordability as rates fell from 4.8% to 3.5%, and sustained demand from both domestic buyers and international investors seeking euro-denominated assets.
The single factor with the strongest upward pressure on Italian property prices is the structural undersupply in desirable locations, where the stock of homes for sale dropped 4% in 2024 alone and continues shrinking, leaving buyers with less negotiating power and pushing discounts from asking prices down to historic lows.
If you want to understand these factors at a deeper level, you can read our latest property market analysis about Italy here.
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What is the property price forecast for Italy in 2026?
How much are property prices expected to increase in Italy in 2026?
As of early 2026, property prices in Italy are expected to increase by approximately 3% to 4% on average over the course of the year, with stronger growth in major cities and more modest gains elsewhere.
The realistic range of forecasts from different analysts spans from 1.5% (Nomisma's conservative estimate) to 4.2% (Scenari Immobiliari's more optimistic projection), with most institutional forecasters clustering around 3% for the national average.
The main assumption underlying most price increase forecasts for Italy is that mortgage rates will remain stable or continue their gentle decline, keeping credit conditions favorable enough to support demand without triggering overheating in the market.
We go deeper and try to understand how solid are these forecasts in our pack covering the property market in Italy.
Which neighborhoods will see the highest price growth in Italy in 2026?
As of early 2026, the neighborhoods expected to see the highest price growth in Italy include Milan's Porta Romana and Santa Giulia (benefiting from Olympics-related development), Rome's Prati and Parioli, and Bologna's university-adjacent districts like San Donato-Fiera.
The projected price growth for these top neighborhoods ranges from 5% to 8% for the year, significantly outpacing the national average, with Milan's Olympics-adjacent areas potentially seeing even higher premiums during the February Games.
The primary catalyst driving expected growth in these neighborhoods is the combination of infrastructure investment, job concentration, and constrained new supply, all of which create favorable conditions for price appreciation in locations where demand consistently outstrips available housing.
One emerging neighborhood that could surprise with higher-than-expected growth is Naples' Poggioreale-Vicaria area, where recent momentum of over 9% year-on-year suggests ongoing gentrification that may accelerate as the city benefits from improved rail connections and growing tourism interest in southern Italy.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Italy.
What property types will appreciate the most in Italy in 2026?
As of early 2026, the property type expected to appreciate the most in Italy is renovated, energy-efficient apartments in major cities, particularly those meeting high energy certification standards.
The projected appreciation for this top-performing property type is around 4% to 6% nationally, with premium new developments in Milan potentially exceeding this as Olympics-related demand peaks in February.
The main demand trend driving appreciation for this property type is the combination of EU energy efficiency requirements, rising renovation costs that make move-in-ready homes more attractive, and the fact that banks are increasingly favoring mortgages on energy-efficient properties.
The property type expected to underperform in Italy in 2026 is unrenovated older stock in smaller towns and rural areas, where the cost of bringing properties up to energy standards often exceeds the potential price gains, creating a difficult equation for both buyers and sellers.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Italy versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
How will interest rates affect property prices in Italy in 2026?
As of early 2026, the impact of current interest rate trends on Italian property prices is moderately positive, as the decline from peak rates in 2023 has improved affordability and stimulated mortgage demand, directly supporting price growth in the residential market.
The current average mortgage rate in Italy sits around 3.5%, down from 4.8% in 2023, and most analysts expect rates to remain stable or decline slightly further through 2026, which would continue supporting buyer purchasing power.
A 1% change in interest rates typically affects Italian property affordability significantly, with estimates suggesting that each percentage point reduction can increase the buying power of a typical household by roughly 10%, which tends to translate into upward price pressure in supply-constrained markets.
You can also read our latest update about mortgage and interest rates in Italy.
What are the biggest risks for property prices in Italy in 2026?
As of early 2026, the top three biggest risks for property prices in Italy are a potential reversal in interest rate trends that would tighten credit, persistently high renovation and energy upgrade costs that burden older properties, and the widening gap between strong urban markets and weaker provincial areas that could create localized downturns.
The single risk with the highest probability of materializing is the continued divergence between "winner" cities like Milan, Rome, and Bologna versus structurally weaker markets in depopulating areas, which could see flat or negative price movements even as national headlines report growth.
We actually cover all these risks and their likelihoods in our pack about the real estate market in Italy.
Is it a good time to buy a rental property in Italy in 2026?
As of early 2026, it is generally a good time to buy a rental property in Italy if you target the right micro-markets, particularly cities with strong year-round rental demand from students, professionals, or tourists, though careful location selection is essential.
The strongest argument in favor of buying a rental property now is that rental yields remain attractive (3% to 6% gross depending on location) while capital appreciation continues in major cities, and the declining interest rate environment makes financing more affordable than it was in 2023.
The strongest argument for waiting is that prices in prime locations like central Milan and Rome feel stretched relative to local incomes, and increased regulation of short-term rentals in cities like Florence and Venice is reducing returns for investors dependent on tourist income.
If you want to know our latest analysis (results may differ from what you just read), you can read our assessment on whether now is a good time to buy a property in Italy.
You'll also find a dedicated document about this specific question in our pack about real estate in Italy.
Buying real estate in Italy can be risky
An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
Where will property prices be in 5 years in Italy?
What is the 5-year property price forecast for Italy as of 2026?
As of early 2026, the estimated cumulative property price growth expected over the next 5 years in Italy is approximately 13% total, which translates to property values being about 13% higher by January 2031 than they are today.
The range of 5-year forecasts spans from about 5% in a conservative scenario (featuring rate reversals or economic slowdowns) to around 22% in an optimistic scenario (sustained urban demand plus stable credit conditions), reflecting Italy's high regional variability.
The projected average annual appreciation rate over the next 5 years in Italy is approximately 2.5% per year compounded, which is modest but consistent with Italy's historically stable, non-speculative property market that avoids boom-bust cycles.
The key assumption most forecasters rely on for their 5-year Italian property price predictions is that the eurozone economy will continue its gradual recovery, credit conditions will remain supportive, and the structural undersupply in major cities will persist due to limited new construction.
Which areas in Italy will have the best price growth over the next 5 years?
The top three areas in Italy expected to have the best price growth over the next 5 years are the Milan metropolitan area (including commuter rail nodes benefiting from Olympics legacy infrastructure), Rome's strongest mixed-demand districts like Prati and EUR, and Bologna with its powerful combination of university demand and business activity.
The projected 5-year cumulative price growth for these top-performing areas ranges from 20% to 30%, significantly outpacing the national average, driven by job concentration, constrained supply, and ongoing infrastructure investment.
This longer forecast aligns with the shorter 2026 outlook in terms of which cities lead, but the 5-year view amplifies the advantage of infrastructure beneficiaries, as projects like Milan's post-Olympics urban regeneration and EU-funded rail upgrades in southern Italy will have more time to impact surrounding property values.
The currently undervalued area with the best potential for outperformance over 5 years is the Naples metropolitan area, where prices remain significantly below Milan and Rome while fundamentals are improving through infrastructure investment, tourism growth, and a younger demographic profile than much of northern Italy.
What property type will give the best return in Italy over 5 years as of 2026?
As of early 2026, the property type expected to give the best total return over 5 years in Italy is mid-sized apartments (60 to 90 square meters) in strong-demand cities, ideally already renovated or meeting good energy efficiency standards.
The projected 5-year total return for this top-performing property type, combining capital appreciation and rental income, is approximately 25% to 35% cumulative, with yields of 4% to 5% annually plus the anticipated price growth.
The main structural trend favoring this property type over the next 5 years is the increasing preference for urban living among younger Italians and professionals, combined with the high liquidity of city apartments (easier to sell, easier to rent, easier to finance) compared to larger or rural properties.
The property type offering the best balance of return and lower risk over 5 years in Italy is the townhouse or semi-detached home in well-connected suburban areas of major cities, which combines family appeal, reasonable entry prices, and growing demand from buyers priced out of city centers.
How will new infrastructure projects affect property prices in Italy over 5 years?
The top three major infrastructure projects expected to impact Italian property prices over the next 5 years are the Milan post-Olympics urban regeneration (including the Porta Romana Olympic Village conversion to student housing), EU-funded high-speed rail extensions in southern Italy, and the ongoing metro expansions in Rome and Milan.
The typical price premium for properties near completed infrastructure projects in Italy ranges from 10% to 25% compared to similar properties without improved connectivity, with the effect being strongest in the first few years after project completion.
The specific neighborhoods that will benefit most from these infrastructure developments include Milan's Porta Romana and Santa Giulia districts (Olympics legacy), Naples' central station area (high-speed rail), and Rome's eastern suburbs along the Metro C extension.
How will population growth and other factors impact property values in Italy in 5 years?
Italy's population is essentially stable or slightly declining overall, but the impact on property values over 5 years will be sharply divergent, with major cities gaining residents through internal migration while smaller towns and rural areas continue losing population and housing demand.
The demographic shift that will have the strongest influence on property demand in Italy is the trend toward smaller households (more single-person and couple households, fewer large families), which increases the total number of housing units needed even as population stagnates, particularly boosting demand for smaller apartments in cities.
Migration patterns, both domestic movement toward job centers like Milan, Rome, and Bologna, and international immigration that concentrates in northern cities, are expected to support property values in these receiving areas while accelerating the challenges faced by depopulating regions.
The property types and areas that will benefit most from these demographic trends are one and two-bedroom apartments in Italy's largest university and employment hubs, as well as accessible family homes in the commuter belts of Milan, Rome, and Bologna where younger families are relocating.
We made this infographic to show you how property prices in Italy compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
What is the 10 year property price outlook in Italy?
What is the 10-year property price prediction for Italy as of 2026?
As of early 2026, the estimated cumulative property price growth expected over the next 10 years in Italy is approximately 30% total, meaning property values could be about 30% higher by January 2036 than they are today.
The range of 10-year forecasts spans from about 15% in a conservative scenario (featuring economic stagnation or significant rate shocks) to around 50% in an optimistic scenario (sustained urban demand, stable credit, and successful infrastructure development), reflecting the inherent uncertainty in long-term predictions.
The projected average annual appreciation rate over the next 10 years in Italy is approximately 2.5% to 3% per year, which is modest by global standards but consistent with Italy's mature, low-volatility property market.
The biggest uncertainty factor in making 10-year property price predictions for Italy is the future path of eurozone monetary policy and credit conditions, as Italian buyers are highly sensitive to mortgage rates, and a sustained period of tight credit could significantly dampen the forecast.
What long-term economic factors will shape property prices in Italy?
The top three long-term economic factors that will shape property prices in Italy over the next decade are real income growth and productivity improvements (which determine what Italians can afford), credit cycle dynamics and bank lending appetite (which control access to mortgages), and the urbanization trend that continues concentrating demand in major cities.
The single long-term economic factor that will have the most positive impact on Italian property values is the ongoing transformation of cities like Milan into European business hubs, which attracts international investment, high-income professionals, and corporate relocations that all support premium property demand.
The single long-term economic factor that poses the greatest structural risk to Italian property values is demographic decline, as Italy's low birth rate and aging population mean fewer first-time buyers entering the market over time, potentially creating sustained pressure on demand in all but the most attractive locations.
You'll also find a much more detailed analysis in our pack about real estate in Italy.
What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Italy, we always rely on the strongest methodology we can... and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why it's authoritative | How we used it |
|---|---|---|
| ISTAT House Price Index | Italy's official national statistical institute for transaction-based price data. | We anchored our price growth figures to official transaction data rather than asking prices. We also used ISTAT's dwelling type definitions to ensure consistency. |
| Bank of Italy Housing Survey | Italy's central bank provides structured market condition analysis. | We used it to explain demand and supply dynamics in plain language. We calibrated typical negotiation discounts using their survey data. |
| Agenzia delle Entrate OMI | Italy's official property market observatory for valuation reference. | We used OMI ranges to sanity-check portal-based asking prices. We validated our regional price estimates against official zone data. |
| idealista | Major Italian property portal with transparent index methodology. | We used their city and neighborhood reports to identify fast-rising areas. We sourced current asking price levels that buyers actually see in listings. |
| Immobiliare.it | One of Italy's largest property portals with clear regional breakdowns. | We used it to quantify regional price dispersion across Italy. We cross-checked whether national averages were plausible against their data. |
| ABI (Italian Banking Association) | Aggregates banking market information and credit conditions. | We used their data to explain interest rate and mortgage cost trends. We supported our analysis of why credit conditions matter for Italian buyers. |
| ECB Data Portal | Central bank dataset hub for harmonized property price series. | We corroborated Italy's multi-year price direction against eurozone trends. We used it as a cross-check for our national series choices. |
| Eurostat | EU's official statistics body documenting cross-country comparability. | We verified that our HPI concept is consistent with EU methodology. We used it as a second official lens to validate Italian narratives. |
| BIS Residential Property Statistics | Top-tier international financial institution with widely cited housing data. | We cross-checked real versus nominal price dynamics. We framed Italy within the broader European housing recovery context. |
| Gruppo Tecnocasa | Major Italian brokerage network with long history of market research. | We used their forecasts as a professional expectations reference. We triangulated our 2026 scenario ranges using their analysis. |
| Nomisma | Leading Italian real estate research firm with institutional credibility. | We incorporated their transaction volume and price forecasts. We balanced their conservative estimates against other analyst views. |
| Scenari Immobiliari | Respected property research firm producing annual market outlooks. | We used their 800,000 transaction forecast for 2026. We incorporated their city-level growth projections into our analysis. |
| European Commission | Official EU program pages with funded delivery timelines. | We grounded infrastructure impacts in specific, dated projects. We explained how connectivity improvements can lift property values. |
| Reuters | Credible international news agency with fact-checked reporting. | We used their ECB coverage to contextualize Italian affordability pressures. We incorporated Olympics venue and infrastructure reporting. |
| Milano Cortina 2026 | Official organizing committee for the 2026 Winter Olympics. | We sourced venue locations and infrastructure timelines. We validated the Olympics effect on specific Milan neighborhoods. |
| Cushman & Wakefield | Global real estate services firm with institutional market analysis. | We incorporated their yield compression forecasts for prime areas. We validated institutional investor sentiment toward Italian real estate. |
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If you want to go deeper, you can read the following: