Authored by the expert who managed and guided the team behind the Italy Property Pack
Yes, the analysis of Sicily's property market is included in our pack
What will happen in Sicily’s real estate market? Will prices go up or down? Is Palermo still a hotspot for foreign investors? How is Italy’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Sicily, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Rents in coastal areas will rise as they become more popular for short-term holiday stays
Coastal areas in Sicily are becoming hot spots for short-term holiday rentals due to a surge in tourism.
In 2023, Sicily saw a whopping 16 million visitors, with a 10.8% jump from the previous year and a 24.8% rise in foreign tourists. This influx is making scenic coastal regions a prime target for accommodations.
The real estate market is buzzing, with residential property transactions up by 9% by 2024. Airbnb listings have exploded to over 35,000, boasting a median occupancy rate of 59%, showing that short-term rentals are in high demand.
Property values are climbing, with the average price per square meter rising by 3.01% in July 2024. This uptick is a clear sign of the growing interest in coastal real estate, fueled by both local and international buyers.
The regional administration is also playing a part by promoting tourism and managing tourist flows, making these coastal spots even more appealing.
Sources: Guidaviaggi, Airbtics, Airbtics
2) More foreign buyers will diversify the types of properties available in Sicily
Foreign buyers are flocking to Sicily, transforming the property market.
In recent years, 13.5% of property transactions in Italy involved foreign buyers, up from 10.7% in 2019. This trend is reshaping the landscape, with a potential surge to 60% by 2025. As these international buyers bring their unique tastes, the variety of available properties is expanding. From charming flats to sprawling farmhouses and traditional masserie, the options are becoming more diverse.
One interesting shift is the rising demand for lamie, quaint structures typical of the Salento area. This reflects a broader interest in authentic, regional architecture. To meet these evolving preferences, Sicily is seeing a wave of new property developments. New build villas, including two-family and terraced houses, are popping up, catering to the desires of foreign buyers.
Real estate agencies are also adapting, with many now specializing in international clients. They offer a range of services tailored to these buyers, making the process smoother and more appealing. This specialization is crucial as it helps bridge cultural and logistical gaps, ensuring a seamless experience for newcomers.
As Sicily continues to attract global interest, the property market is becoming a melting pot of styles and preferences. This influx is not just about numbers; it's about the rich tapestry of choices now available. Whether you're looking for a modern villa or a rustic farmhouse, the options are plentiful and varied.
Sources: Gate-away.com, Idealista, Immobiliare.it
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.
3) Price growth in Taormina's real estate market will slow down due to saturation
The real estate market in Taormina is cooling down as price growth slows due to saturation.
In 2024, the average asking price for properties in Taormina was €3,204 per square meter, a notable jump from the previous year. But with a high number of unsold homes, this growth is expected to slow. By June 2024, nearly two-thirds of homes had lingered on the market for over 30 days, highlighting the surplus of available properties.
Homes in Taormina are taking longer to sell, with prices peaking in October 2024 before leveling off. This stabilization hints at a potential slowdown in price growth. Foreign buyers, once a driving force, are pulling back due to geopolitical and economic concerns, further reducing demand.
Record-high home prices and elevated mortgage rates are making potential buyers think twice. This hesitation is a key reason for the sluggish price growth in Taormina. The market is feeling the pinch as fewer buyers are willing to commit.
With more homes sitting unsold, the market is becoming saturated. This saturation is evident as buyers are deterred by high costs and uncertain economic conditions. The once-booming market is now facing a reality check.
As the inventory of unsold homes grows, the market dynamics are shifting. The combination of high prices and reduced foreign interest is reshaping the real estate landscape in Taormina.
Sources: Immobiliare.it, The Mortgage Point, Sicilian Houses
4) Rental yields in Palermo will rise as the student population grows
Rental yields in Palermo are set to rise thanks to a growing student population.
The University of Palermo is seeing more students, especially from abroad, which means higher demand for student housing. Popular neighborhoods like Borgo Vecchio, Libertà, and Politeama are becoming hotspots for these students.
Platforms like Erasmus Play are buzzing with activity as students search for rooms, showing just how much accommodation is needed. This surge in demand is pushing rental prices up, especially near the university.
There's a noticeable shortage of student housing in Palermo, which is a clear sign of potential for increased rental yields. As more students flock to the city, landlords are likely to see better returns.
With the university's growing enrollment, particularly from international students, the rental market is heating up. This trend is making Palermo an attractive spot for property investors.
As the student population continues to grow, rental prices are expected to climb, making it a promising time to invest in Palermo's real estate market.
Sources: University of Palermo, Erasmus Play, Sicilian Houses
5) Property prices in the Etna region will drop because of worries about volcanic activity
Properties in the Etna region are likely to see a decline in prices due to increased concerns about volcanic activity. In 2023, Mount Etna experienced a powerful eruption, which was followed by more activity in 2024. This pattern of frequent eruptions raises concerns about the safety and stability of the area.
Historically, property prices have been affected by volcanic activity, as seen with the four flank eruptions since 2000. The recurring nature of these eruptions suggests a long-term risk that can deter potential buyers. Additionally, insurance companies often raise premiums or refuse coverage for properties near active volcanoes, increasing costs for property owners and making the area less attractive for investment.
Scientific reports have predicted heightened volcanic activity in southern Italy, including the Etna region. This potential for more destructive eruptions can further discourage investment in local properties. Local government advisories and evacuation plans, such as those issued during the 2023 eruption, also contribute to the perception of risk, reducing the appeal of living in the area.
Sources: Watchers News, NHESS, Global Volcanism Program
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6) Foreign investment in Sicily will grow as more countries market it as a real estate hotspot
Sicily is catching the eye of foreign investors, especially in real estate.
In 2022, foreign buyers snapped up 9% of homes in Sicily, spending around 120,000 euros each time. This trend is likely to grow as people discover the island's charm and affordability.
Real estate agencies are on the move, with companies like Engel & Völkers actively marketing Sicily's luxury properties. Their global reach is helping to put Sicily on the map for international buyers.
The Sicilian government is sweetening the deal by offering incentives for renovating historic properties. This not only boosts property values but also makes the area more attractive to investors.
These efforts are paying off, as more countries are promoting Sicily as a real estate hotspot. The combination of government incentives and agency marketing is creating a buzz.
With its stunning landscapes and rich history, Sicily is becoming a top choice for those looking to invest in property. The island's unique appeal is drawing in more international interest.
Sources: Sicilian Houses, Engel & Völkers, Macrotrends
7) Rental yields in Sicily’s countryside will drop as more homes become vacation rentals
In Sicily, the number of properties turning into vacation rentals has surged, especially in 2023 and 2024.
By September 2024, there were 35,424 active Airbnb listings in Sicily, showing a clear shift towards short-term stays. This boom in vacation rentals is pushing property prices up, with the average price for residential properties hitting €7.64 per square meter in October 2024. Locals are finding it harder to afford homes as demand for these rentals grows.
In the Sicilian countryside, the long-term rental market is feeling the pinch. Many real estate agents report minimal earnings due to a glut of residential properties and high unemployment rates. This means fewer homes are available for long-term rentals, which is hurting rental yields.
Popular tourist spots like Catania and Taormina are facing housing shortages. Despite strict regulations aimed at balancing tourism and housing, the conversion of homes into vacation rentals is putting a strain on the local housing market. Local communities are struggling to find affordable housing as more properties cater to tourists.
As more properties become vacation rentals, yields in the Sicilian countryside are expected to decline. This trend is reshaping the real estate landscape, making it tougher for locals to find affordable long-term housing options.
Sources: Airbtics, Immobiliare.it, British Expats, Airbtics
8) Rental demand growth will boost residential property yields in Sicily
The overall yield on residential properties in Sicily is set to rise as rental demand continues to grow.
With 16,462,000 tourists visiting in 2023, Sicily is buzzing with activity. This includes a 24.8% jump in foreign visitors compared to the previous year, showing that the island is a hot spot for travelers. Naturally, this surge in tourism is pushing up rental demand, especially in the most sought-after areas.
But it's not just tourists flocking to Sicily. The island is becoming a favorite among digital nomads, thanks to its charm and lifestyle. This trend is catching on, with more remote workers choosing Sicily as their base. As a result, residential property transactions have climbed by 9% in 2024, reflecting a growing population and a stronger need for housing.
Short-term rental platforms like Airbnb are thriving here. In 2023, a typical listing was booked for 215 nights a year, highlighting a vibrant short-term rental market. This success is encouraging property owners to tap into the rental market, which could also boost long-term rental demand.
Sources: Airbtics, Guida Viaggi, MSCI
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Italy. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
9) More foreign retirees will buy homes in Sicily because of the good climate and affordable living
In recent years, Sicily has become an increasingly popular destination for foreign retirees looking to purchase homes. This trend is largely driven by the island's favorable climate and affordable cost of living. In 2022, foreigners accounted for 9% of house purchases in Sicily, with an average spending of 120,000 euros per transaction, highlighting a growing interest in the region's real estate market.
The demand for properties in Sicily continued to rise, with a 16.01% increase in property requests in the first quarter of 2023 compared to the same period in the previous year. This surge in interest is partly due to Sicily's mild Mediterranean climate, which is highly appealing to retirees seeking a comfortable and enjoyable lifestyle.
Moreover, Sicily offers a range of affordable housing options, making it an attractive choice for retirees on a budget. The island's affordability, combined with its natural beauty and cultural heritage, enhances its appeal as a retirement destination. Additionally, the growing expatriate community in Sicily further underscores its attractiveness to foreign retirees.
Sources: Gate Away, Sicilian Houses, Expatica
10) Property prices in Sicily will stabilize as new developments are finished
Sicily's property market is buzzing with new developments.
Thanks to a boom in tourism and better infrastructure, there's a growing demand for vacation homes and short-term rentals. As more of these new developments wrap up, property prices are expected to level out.
The Sicilian government is also stepping in to help. They're offering incentives for property renovations, especially in historic areas. This is part of a bigger plan to breathe new life into communities and boost the housing supply, making the market more balanced.
Then there's the famous €3 house initiative, which has caught the eye of both local and international buyers. This program, along with other financial perks from municipalities, is ensuring that new developments keep pace with demand.
These efforts are not just about selling houses; they're about revitalizing the local economy. With more buyers coming in, the property market is seeing a positive shift.
As these new developments continue to pop up, the general expectation is that property prices will stabilize, making it a good time to consider buying in Sicily.
Sources: Mighty Travels, Idealista, Idealista
11) Property prices in Sicily will moderately decline in areas reliant on seasonal tourism
In recent years, Sicily has experienced a noticeable shift in its tourism dynamics, which is expected to impact property prices in areas heavily reliant on seasonal tourism. Although 2023 saw an increase in tourist arrivals compared to the previous year, the numbers still haven't fully recovered to pre-pandemic levels. This gap, combined with projections of a global economic downturn, suggests that tourist arrivals might decline in the coming years.
Rising travel costs, such as fuel and accommodation, are making tourists more price-sensitive, leading to reduced spending in local businesses. This trend is compounded by increased competition from other tourist destinations, which are drawing visitors away from traditional spots like Sicily. As a result, property prices in these areas could see a decline due to decreased demand.
Additionally, there is a shift in tourist preferences, with many opting for new destinations over traditional ones. This change, along with reports of reduced spending by tourists and local businesses closing due to decreased footfall, indicates a broader trend of reduced economic activity in these regions. Such factors contribute to a less confident investment environment, further impacting property prices.
Sources: Tourism Review, Sicilian Houses, The Wandering Investor
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12) More young people will move to cities in Sicily for jobs, changing the demographic landscape
In recent years, Sicily has been experiencing a demographic shift, largely driven by younger generations moving to urban centers in search of job opportunities.
The declining birth rates in Sicily, with only 6.4 children per 1,000 inhabitants in 2023, indicate a shrinking younger population. This trend suggests that fewer young people are staying in Sicily, contributing to the demographic changes.
Additionally, there is a significant trend of young Sicilians migrating to northern Italy or other European countries. This migration is often motivated by the higher job availability in urban centers compared to rural areas, as studies have shown.
Surveys and social media trends also reveal that young people prefer urban living due to better job opportunities, cultural diversity, and access to amenities. These factors make cities more attractive to the younger generation, further driving the demographic shift.
Sources: Macrotrends, Statista
13) Eco-conscious buyers will increasingly seek sustainable living options in Sicily's rural areas
Rural areas in Sicily are becoming a hotspot for eco-conscious buyers looking for sustainable living options.
In Italy, there's a noticeable shift towards eco-friendly and energy-efficient homes, with expectations of a 20% rise in demand by 2025. This change is largely due to a growing awareness of environmental issues and the perks of living sustainably. The Italian government is on board, offering incentives like "bonus edilizi case green" to encourage building and renovating homes that meet sustainable standards. This aligns with Europe's broader goal of achieving climate neutrality by 2050, making sustainable living more accessible and appealing.
Sicily's Rural Development Programme is also in the mix, focusing on environment-friendly farm investments and management practices. This emphasis on sustainability resonates with eco-conscious buyers who are drawn to areas that prioritize environmental care. Social media and media coverage are playing their part too, boosting the popularity of rural and sustainable lifestyles, which adds to the charm of Sicily's countryside.
For those considering a move, Sicily offers a unique blend of traditional charm and modern sustainability. The island's commitment to eco-friendly practices is evident in its agricultural policies and community initiatives. Buyers can expect to find properties that not only meet their environmental standards but also offer a rich cultural experience.
Living in Sicily means embracing a lifestyle that values both the environment and the local community. The region's focus on sustainable agriculture and energy-efficient homes makes it an ideal choice for those looking to reduce their carbon footprint while enjoying the beauty of rural Italy.
With government support and a growing market for sustainable living, Sicily is poised to become a leading destination for eco-conscious buyers. The combination of incentives, community initiatives, and a commitment to sustainability makes it an attractive option for those seeking a greener lifestyle.
Sources: Agriculture.europa.eu, World Food System ETH Zurich
14) Property prices in Palermo and Catania's historic centers will rise significantly due to cultural tourism
Cultural tourism in Sicily is booming, drawing more visitors each year.
In 2023, Sicily saw over 16 million tourists, a 10.8% jump from the previous year. This includes a 25% rise in foreign visitors, showing a growing global interest in the island's rich culture. With this influx, the local economy is expected to thrive, potentially reaching a turnover of 11 billion euros by 2028. This trend is making historic centers like Palermo and Catania hot spots for property investment.
Getting to Sicily is about to get easier. Starting in 2025, new direct flights from Newark and JFK will connect more tourists to the island. This improved accessibility is likely to boost tourism further, which in turn could drive up property prices in these historic areas.
In Catania, investments in tourism infrastructure and redevelopment projects are underway. These efforts are set to enhance the city's charm, making properties there even more desirable. As these projects progress, property values are expected to rise, attracting both investors and tourists.
The Sicilian government is also playing a key role in this transformation. By offering incentives for property renovations in historic areas, they are increasing the value of upgraded properties. This initiative is likely to draw more buyers looking for a slice of Sicily's cultural heritage.
Moreover, the government is implementing policies to support tourism businesses and promote sustainable use of cultural resources. These efforts are enhancing the appeal of properties in Palermo and Catania, making them attractive investments for those interested in cultural tourism.
Sources: Tourism Review, Rome Business School, Experience Sicily, Guida Viaggi
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.
15) Property prices in the Aeolian Islands will drop due to stricter environmental rules
In recent years, stricter environmental regulations have been introduced in the Aeolian Islands, which are expected to impact property prices. Historically, regions with similar regulations have seen a decline in property values. This is often because these regulations can make areas less appealing to developers and buyers who are interested in development opportunities rather than environmental sustainability.
Case studies from other tourist destinations, like the Costa Brava in Spain, show that when strict environmental policies are implemented, property prices tend to decrease. This is because developers face more challenges in constructing new projects, which can reduce the overall demand for properties in these areas. Additionally, reports have highlighted that while environmental regulations are necessary to protect natural resources, they can indirectly affect property values by increasing the costs associated with owning and developing properties.
Surveys have shown that while property buyers appreciate environmental sustainability, they are often reluctant to pay higher prices for properties in areas with stringent regulations. This is because the perceived restrictions and costs can outweigh the benefits of living in a protected environment. Furthermore, the cost of compliance with new regulations, such as obtaining specialized permits and undergoing inspections, can be significant for property owners, making these properties less attractive to potential buyers.
16) Property prices in Sicily will keep rising because demand is growing faster than supply
Sicily's real estate market is booming, with a 9% increase in property transactions in 2024.
Foreign buyers are flocking to Sicily, making up 9% of house purchases in 2022. The island's stunning landscapes and affordable property prices compared to other Italian regions are major draws for international investors.
In July 2024, the average price per square meter for homes in Sicily rose by 3.01%, reaching 1,163 euros. This price hike signals a limited supply of properties, especially in budget-friendly areas like Caltanissetta.
Urban hotspots like Palermo and Catania are seeing property prices climb, thanks to their cultural allure and bustling tourism. The thriving tourism industry is also driving up demand for short-term rentals, putting extra pressure on the housing market.
Sources: Sicilian Houses, Idealista, Cushman & Wakefield, Immobiliare.it
17) Demand for traditional Sicilian farmhouses will rise as buyers look for unique and authentic living experiences
Interest in traditional Sicilian farmhouses is booming as international buyers crave unique and authentic living experiences.
In 2022, foreigners made up 9% of house purchases in Sicily, with Germans, French, British, and Americans leading the charge. This surge highlights Sicily's irresistible charm, from its rich cultural heritage to its stunning landscapes and inviting climate.
Italy's agritourism scene is also thriving, with a 2.5% growth in 2023, drawing over 4.5 million visitors. This trend shows a shift towards rural tourism, where staying in traditional farmhouses is a key attraction, perfectly aligning with the desire for experiential travel.
Media and social media have amplified the allure of Sicilian farmhouses. Platforms like Scenari Immobiliari and Idealista.it spotlight these properties, while social media buzzes with renovation stories and lifestyle snapshots, sparking even more interest.
Potential buyers are inspired by the exposure, eager to dive into the unique living experiences that Sicilian farmhouses offer. The blend of tradition and modernity in these homes is a major draw for those seeking something different.
As more people discover the beauty and authenticity of Sicilian farmhouses, the demand continues to rise, making them a hot commodity in the real estate market.
Sources: Sicilian Houses, Statista, C-Legal
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.