Authored by the expert who managed and guided the team behind the Italy Property Pack
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What is happening in Milan’s real estate market? Are prices on the rise or decline? Is the city still a magnet for international investors? How are local government policies shaping real estate dynamics in 2025?
These are the questions we hear every day from professionals, buyers, and sellers alike, from the bustling streets of Brera to the historic charm of Navigli. Perhaps you’re curious about these trends too.
We know this because we stay closely connected with local experts and individuals like you, exploring the Milanese real estate landscape daily. That’s why we crafted this article: to deliver clear answers, insightful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed the mark or could improve, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll strive to enhance this content for you.
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1) Central Milan will see higher rental yields as demand for short-term rentals rises
Rental yields in central Milan are set to rise as more people look for short-term rentals.
With Milan being a top travel spot, tourist numbers are climbing, and this means more people need places to stay. As a result, short-term rental demand is going up, which is great news for rental yields.
Platforms like Airbnb are a big part of this story. By June 2024, Milan had over 24,000 Airbnb listings, many of which are entire homes or apartments. These places are booked for about 255 nights a year, with a 70% occupancy rate and an average daily rate of €116. This shows a strong demand for short-term rentals, pushing rental yields higher.
Young professionals and digital nomads are also flocking to Milan, looking for flexible living options. This group prefers short-term stays, which further boosts demand and rental yields. Investors are catching on, with more of them focusing on short-term rental properties in central Milan.
Real estate market reports highlight this shift, showing rising prices and demand for properties in the area. This trend is a clear sign that short-term rentals are becoming a hot commodity.
Sources: Airbtics, Statista, Global Property Guide
2) Milan’s luxury property prices will keep rising with strong international interest
Luxury property prices in Milan are expected to continue rising due to several key factors. First, the turnover of the Milanese luxury market in 2023 reached approximately 854.2 million euros, marking an 8.7% increase compared to 2021. This indicates a strong and growing market for luxury properties.
Additionally, the average price for luxury homes in Milan rose by 7.2% compared to 2021, reaching 11,750 euros per square meter. This consistent price increase highlights the ongoing demand for luxury real estate in the city. Furthermore, the global population of ultra-high net worth individuals (UHNWI) grew significantly, with many moving to new countries, suggesting continued international interest in Milan's luxury market.
The limited supply of luxury properties in prime areas also plays a crucial role. In 2023, over 40% of real estate agents reported a significant drop in available luxury properties in central areas, while demand remained strong. This scarcity, particularly in sought-after districts like the Quadrilatero della Moda, where prices can reach up to 30,000 euros per square meter, drives prices upward.
Sources: Milanostyle, Columbus International, Engel & Völkers
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.
3) Rents for student housing in Milan will increase as more international students choose the city for their studies
Milan is a hot spot for international students, drawing more and more each year.
In the 2023/2024 academic year, 96,083 foreign students enrolled at Italian universities, with many choosing Milan. This surge is largely because Milan's universities now offer more English-taught programs, making it easier for students worldwide to study there.
The city is bustling with nearly 175,000 students, and they make up a significant portion of the demand for housing. In fact, students in Milan account for 15.4% of the total demand for student housing. But here's the catch: there's not enough housing to go around, which is pushing rents up.
Right now, if you're looking for a single room in Milan, expect to pay around €560 per month. And if you're eyeing a spot in a prime or central area, prices can be even steeper.
According to a European survey by HousingAnywhere, rental prices in Milan have been climbing. In the second quarter of 2024, room rates jumped by 3.5% and apartment rates by 4.2%. This trend is likely to continue as more international students flock to the city.
With the growing number of students, the demand for housing is only going to increase, making it a challenging market for those looking to rent.
Sources: Statista, Aura REE, ICEF Monitor
4) Brexit will prompt more UK buyers to view Milan as an alternative European base
In 2024, Milan is becoming a hotspot for UK buyers seeking a post-Brexit haven.
Local real estate agents are buzzing about the uptick in interest from wealthy Brits. They're drawn to Milan's luxury lifestyle, which is more affordable than other European cities. The city's favorable tax policies and vibrant culture make it a top choice for those looking to relocate within the EU.
Media outlets like the Financial Times are spotlighting Milan's appeal for UK expats, noting its cultural and economic perks. Italy's new tax incentives are a big draw, making Milan an attractive option for affluent individuals.
Property prices in Milan offer a luxury lifestyle at a better price compared to other European hotspots. Plus, with more flights connecting the UK and Milan, it's easier than ever for Brits to explore and invest in the city.
UK buyers rave about Milan's lifestyle and the ease of purchasing property. Real estate agencies report a surge in British clients, highlighting the city's growing allure for UK investors.
Milan is also catching the eye of UK businesses, thanks to its strategic location and business-friendly environment. The city's favorable tax policies are enticing UK companies to set up shop, making it a viable alternative to London.
Government initiatives are further boosting Milan's real estate market, offering tax breaks and luxury infrastructure to attract the global elite. These efforts are paying off, with increased interest from UK buyers.
Source: Wanted in Milan
5) Brera will continue to attract luxury buyers with its historic charm and upscale amenities
The Brera district in Milan is a top choice for luxury buyers because of its historic charm and upscale amenities.
In 2023 and 2024, property prices in Brera were notably higher than in other areas, with some reaching €10,769 per square meter. This shows a strong demand for luxury homes, highlighted by a 27.5% absorption rate, meaning properties are selling fast.
Brera's allure lies in its historic charm, with cobblestone streets and landmarks like the San Marco church and Palazzo di Brera. These are carefully preserved, keeping the district's unique character intact. Plus, being close to cultural spots like the Pinacoteca di Brera art gallery adds to its appeal.
High-end boutiques and designer stores such as Gucci, Prada, and Versace make Brera a hotspot for luxury shopping. This attracts wealthy shoppers and adds to the district's sophisticated vibe. Brera also boasts a range of gourmet restaurants and exclusive cafes, perfect for those who love fine dining and a luxurious lifestyle.
Living in Brera means enjoying a blend of history, culture, and modern luxury. The district's ongoing preservation efforts ensure that its charm remains, making it a lasting favorite among those seeking a high-end lifestyle.
Sources: Yes Milano, Immobiliare.it, Finestre Residences, Milano Style
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6) Bovisa will attract more students and young professionals due to its closeness to universities
The Bovisa area is becoming increasingly popular among students and young professionals, primarily due to its proximity to universities like the Politecnico di Milano. In recent years, this university has seen a significant rise in enrollment, particularly among international students who are drawn to its diverse activities and supportive programs.
In 2023 and 2024, there was a notable investment in student housing projects in Bovisa, with companies like Hines and Blue Noble investing €80 million to build new accommodations. These projects not only provide affordable housing options but also enhance the neighborhood with retail spaces and social areas, making it more attractive to young people.
Additionally, the Bovisa area is part of Milan's urban regeneration plan, which includes improved public transportation links and infrastructure enhancements. These developments make it easier for students and young professionals to commute and enjoy a sustainable lifestyle, further increasing the area's appeal.
Sources: Savills, Hines, Top Universities, Hines News
7) Newly developed areas will provide competitive yields by attracting diverse residents
In recent years, newly developed areas in Milan have become increasingly attractive for residents, offering competitive rental yields. In 2024, the average gross rental yield for apartments in Milan was around 5.04%, with some areas reaching up to 6.55%. This suggests that modern and appealing properties in these new developments can provide strong returns for investors.
One of the key factors contributing to this trend is the significant investment in infrastructure and public transport. For example, the urban residential regeneration project in the San Siro neighborhood includes enhancements like improved metro access, making it easier for residents to reach the city center. Such improvements increase the livability of these areas, drawing in more residents.
Additionally, the affordability of newly developed properties compared to central locations makes them appealing to a diverse range of people. While prices for new and refurbished dwellings are expected to stagnate, used properties have shown positive price increases, indicating that new developments might offer more value for money. This affordability attracts a mix of young professionals and families looking for quality living spaces.
Moreover, the growth of amenities and services in these neighborhoods further enhances their attractiveness. Projects like the one in San Siro include the development of parks and community facilities, which improve the quality of life for residents. This expansion of amenities is a significant draw for those seeking a balanced urban lifestyle.
Sources: Global Property Guide, AXA IM Alts, Idealista
8) Milan’s property prices will rise moderately due to ongoing demand and limited supply
In recent years, Milan has seen a moderate increase in residential property prices, largely due to sustained demand and limited supply. Despite a 15.2% decrease in transaction volumes in 2023, prices have remained stable, indicating that demand is still high even with fewer transactions. This stability suggests that the limited supply of properties is a significant factor in maintaining or increasing prices.
Foreign investment continues to play a crucial role in Milan's real estate market. The city's reputation as a fashion and business hub attracts both domestic and international investors, contributing to the sustained demand for residential properties. This influx of investment keeps the market competitive and supports price increases.
Moreover, the limited new housing developments in Milan exacerbate the supply issue. With only about 50,000 new houses built annually in Italy, compared to France's 200,000, the scarcity of new developments means fewer properties are available for sale. This limited supply, combined with strong buyer interest, particularly in areas like Ponte Lambro-Santa Giulia, drives up prices.
Sources: Idealista, Engel & Völkers, Unlocking Real Estate Value, Immobiliare.it
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.
9) Milan will see rising demand for accessible, senior-friendly housing due to an aging population
Milan's elderly population has grown by 5.4% over the last two decades, leading to a higher demand for senior-friendly housing.
With life expectancy in Italy projected to reach 84.26 years by 2025, more people are living longer, which means the elderly demographic in Milan is expanding. This shift is pushing the need for homes that cater to the lifestyle and health needs of seniors.
The senior housing market is booming, with a 40% increase in the absorption rate of senior housing in early 2024. This shows a strong demand for accommodations that offer accessibility and support, crucial for seniors to maintain independence and quality of life.
Developers are stepping up by creating senior-friendly communities. These include cohousing models that promote social interaction and mutual support among residents, recognizing the need for tailored housing solutions for the elderly.
In Milan, the aging population is driving a shift in the housing market. Senior-friendly housing is becoming a priority, as more people seek homes that accommodate their changing needs.
As the city adapts to this demographic change, the focus is on creating environments that support seniors, ensuring they have the necessary amenities and community support to thrive.
Sources: Macrotrends, Interimmobili Agency, NIC MAP Vision, Statista
10) Milan's city center rents will increase as demand exceeds supply
Rents in Milan's city center are expected to rise as demand outpaces supply due to several key factors. First, the average cost of rents per square meter in Milan was around 24.7 euros, with forecasts predicting an increase to 25 euros by the end of 2024. This trend was already evident in the first half of 2023, when rental prices in top locations rose by an average of eight percent.
The increasing population and urbanization rates in Milan also contribute to the rising demand for housing. In 2024, the metro area population reached 3,161,000, with a high population density of approximately 18,600 people per square mile. This indicates a strong demand for housing in the city center.
Moreover, the limited availability of new housing developments exacerbates the scarcity of supply in the rental market. This scarcity allows landlords to apply higher prices, further driving up rents. Additionally, the growing interest from international investors and expatriates, attracted by Milan's status as a center of finance and fashion, adds to the demand for rental properties.
Sources: Macrotrends, Engel & Völkers, NSS Magazine
11) Affordable housing projects in Milan will stabilize prices in some neighborhoods
Affordable housing projects in Milan are expected to help stabilize property prices in certain neighborhoods through several mechanisms. One key factor is the increased government investment, such as the European Investment Bank's commitment of €34 million to refurbish over 200 apartments in the Sarpi district. This initiative aims to promote sustainable social housing and urban regeneration, which can help balance the housing market by providing more options for residents.
Historical data also supports this expectation. For instance, the Redo Merezzate project, which opened in 2019, has been successful in stabilizing the local market by offering 615 units with a range of amenities. This project has shown that providing affordable housing can help maintain property prices by meeting the demand for low- and moderate-income households.
Moreover, demographic studies indicate a strong demand for affordable housing in specific neighborhoods of Milan. The trend of remote work and digital nomadism has attracted more professionals to the city, increasing the demand for residential properties. By addressing this demand, affordable housing projects can prevent property prices from skyrocketing, ensuring a more balanced market.
Sources: EIB Press Release, Terner Center Blog, Comune di Milano
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12) Young professionals will increasingly move to Milan for job opportunities, causing a demographic shift
In recent years, Milan has become a magnet for young professionals seeking job opportunities, and several factors have contributed to this demographic shift. The employment rate in Lombardy, where Milan is located, has rebounded to nearly pre-Covid levels, with sectors like technology, IT, and digital marketing thriving. This growth in productive industries is drawing young talent to the city.
Moreover, Milan has seen a significant increase in multinational companies establishing offices there. With over 4,700 foreign-owned business headquarters, including major players like IBM and Microsoft, the city offers a robust business environment and serves as a hub for innovation and technology. This presence of international companies further enhances Milan's appeal to young professionals.
Additionally, Milan's reputation as a business and innovation hub continues to grow. The city ranks third in Europe for venture capital funding, following Paris and London, which underscores its status as a leading center for innovation. This influx of investment and the expansion of coworking spaces and startup incubators create a dynamic ecosystem that attracts young professionals eager to be part of a vibrant business community.
Sources: Expat.com, YesMilano, FDI Intelligence
13) Virtual reality tours will become more prevalent in Milan’s real estate market, improving the buying experience
Virtual reality tours are becoming more common in Milan's real estate market due to several compelling reasons. First, the global virtual reality market has been growing rapidly, with its size expected to reach USD 435.36 billion by 2030. This growth indicates a broader acceptance and integration of VR technology across various industries, including real estate.
In 2023, more than half of adults had already taken a virtual tour, and a significant 67% of home buyers expressed a desire for virtual tours when viewing property listings. This trend highlights a shift in consumer preferences towards digital experiences, which is particularly relevant for international buyers interested in Milan's real estate market. Virtual tours make it easier for these buyers to view properties remotely, enhancing their buying experience.
Moreover, real estate agencies in Milan have been increasingly adopting virtual reality technology to improve their marketing strategies. This adoption is driven by the effectiveness of virtual tours in facilitating successful property sales, as homes with virtual tours sold for 9% more on average and closed 31% quicker than those without. The integration of advanced 3D modeling and augmented reality technologies has also made virtual tours more engaging and accessible, further encouraging their use.
Sources: PhotoUp, Grand View Research, Scoop Market
14) Asian investors will show increasing interest in Milan’s residential real estate market
Asian investors are increasingly eyeing Milan's residential real estate market.
One big reason for this surge is the improved connectivity between Asia and Milan. For example, China Eastern Airlines launched direct flights from Xi'an to Milan in September 2024, making travel much easier and potentially drawing more Asian investors to the city.
Tourism and cultural exchanges are also on the rise, thanks to new direct flights from Chengdu to Milan Malpensa. This boost in connectivity is part of a larger trend of Asian investments in European real estate, with several Chinese airlines now flying between China and Italy, including Milan.
We're also seeing more partnerships between Asian real estate firms and Italian developers. Take Ardian, for instance, a private investment house that recently acquired a historic property in Milan. They plan to refurbish it with high sustainability standards, showing a growing interest in quality residential properties in the city.
Asian financial institutions setting up shop in Milan are making it easier for investors to dive into the real estate market. This presence is a strong indicator of the supporting trend of Asian investments in Milan's residential sector.
With these developments, it's clear that Milan is becoming a hotspot for Asian investors looking for residential opportunities. The city's enhanced connectivity and growing partnerships are paving the way for a flourishing real estate market.
Sources: China Daily, Italia Absolutely, Ardian
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.
15) Redevelopment projects will boost the San Siro area’s appeal, attracting more attention
The San Siro area is set to gain significant attention due to several redevelopment projects that have been enhancing its appeal. One of the key projects is the renovation of the San Siro Stadium, which includes the construction of new buildings and infrastructure, such as a “fourth ring.” This ambitious project is expected to cost around €300 million and aims to keep both AC Milan and Inter Milan playing in the stadium during the renovations.
In 2023 and 2024, property prices in the San Siro area saw a notable increase, with the average price per square meter rising from €2,255 to €2,437, marking an 8.07% increase over the year. This rise in property prices, which is higher than the provincial average, indicates growing interest and investment in the area. Additionally, the real estate market trends show increased interest from buyers and investors, further highlighting the area's potential.
Moreover, the redevelopment plans include improvements in public transport links and the introduction of new amenities and services, which are expected to enhance the overall experience for both residents and visitors. The involvement of renowned architect Julius Fenyves in the renovation plans underscores the project's significance and potential to transform the San Siro area, similar to successful redevelopment projects in other cities.
Sources: Coliseum Online, Immobiliare.it
16) Stricter environmental rules will boost demand for energy-efficient homes in Milan
In recent years, Milan has seen a noticeable increase in the demand for energy-efficient homes. This trend is largely driven by several key factors. First, a survey by the Milan Polytechnic and the Turin Polytechnic revealed that people are willing to pay an 8.4% premium for class A energy-efficient homes. This shows a clear preference for homes that are more energy-efficient.
The Italian government has also played a significant role by implementing stricter energy performance requirements for new buildings and major renovations. These regulations are part of the Energy Performance of Buildings Directive (EPBD), which has been enforced through updates to Legislative Decree 192/2005. Such measures ensure that new constructions meet high energy performance standards, pushing the market towards energy-efficient homes.
Moreover, the EU's EPBD has set stricter minimum energy performance requirements, which are expected to become even more stringent. This regulatory environment is a major driver for the increased demand for energy-efficient homes, as it encourages both builders and buyers to prioritize energy efficiency.
Sources: Abaco Team, CA EPBD
17) New tax incentives will boost investment in Milan’s residential real estate market
New tax incentives are set to encourage investment in Milan's residential real estate market for several reasons. First, the Italian government's 2024 Budget Law reconfirmed various property-related tax incentives, such as the Bonus Casa and the Bonus Mobili e Elettrodomestici. These incentives are designed to encourage property improvements and investments, making it more attractive for investors to put their money into Milan's real estate market.
Additionally, the Bonus Casa offers a 50% tax reduction on renovation expenditures up to 96,000 euros per real estate unit. This incentive is not only available to property owners but also extends to family members living with the owner, broadening the range of potential investors. Such tax breaks make it financially appealing for both domestic and international investors to consider purchasing and renovating properties in Milan.
Moreover, the rental market in Milan has been growing, with average rents increasing by 5.2% annually. This trend indicates a strong demand for residential properties, which could be further driven by the new tax incentives. As property prices in Milan have shown a slight increase, with new and renovated homes recording a half-yearly increase of 2.4% and an annual increase of 1.9% in the first half of 2024, it suggests that these incentives are contributing to the growth in property prices.
Sources: Italy House Hunting, Agenzia Nova, Dils
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.