The average age of those who can afford a home in Italy is 38 years old

According to a new report by Tailor Made Real Estate, 2025 is expected to be a year of consolidation for the Italian real estate market, driven by the reduction in mortgage interest rates and new housing trends. Industry experts and Italian Real Estate Observatories indicate steady growth, albeit with different dynamics depending on location and property type. After challenging years, the real estate market already showed signs of recovery in 2024, thanks to falling inflation and lower borrowing costs, factors that have encouraged both buyers and investors. According to the Research Center of Euromq.it, 58% of real estate transactions involved the purchase of a primary residence, while 42% concerned second homes, demonstrating the real estate sector as a key reference for investments. On the sales front, 17.3% involved the sale of a primary residence, while 82.8% related to second homes, a figure reflecting the need to rationalize real estate assets due to tax pressure and high management costs. Buyers in 2024 had an average age of 38, with 31% of them between 18 and 35 years old and 24% between 36 and 45 years old. On the other hand, sellers had an average age of 55, with the largest group between 50 and 60 years old. This confirms the trend that young people buy, while older generations sell, often due to inherited properties and a declining younger population.

It is impossible to discuss the Italian real estate market without mentioning Milan, the leading city in Italy for luxury real estate, which saw a 3.5% growth in the luxury property market. In Europe, Stockholm will record the highest increase at 6%, while Dubai will continue to be the world's most important luxury real estate market, with a 5% growth. As for Lombardy and Milan, the region will see a 7.28% increase in prices compared to January 2024. The average price per square meter in Lombardy is expected to rise to €2,519 in 2025 from €2,348 in 2024, while in Milan, the average price will reach €3,856 per square meter. Rents will also increase, rising from €17.50 per square meter in 2024 to €18.35 in 2025. Although it exists in a sort of "bubble" compared to the rest of the country, Milan will continue to be a reference point for the national real estate market, with a significant price increase in emerging areas such as Cimiano (+12.7%) and Bovisa (+11.2%). In the future, as the city undergoes urban redevelopment ahead of the upcoming Olympics, despite construction delays and stalled projects, districts like Certosa and Loreto could become increasingly expensive due to new infrastructure projects and the growing demand for modern and efficient housing.

The report also indicates a strong shift in the type of housing being sought: the rise of remote work and a greater focus on sustainability have driven demand towards properties with more flexible spaces and energy-efficient solutions. Three-room apartments were the most in demand in 2024, accounting for 28.2% of transactions, followed by four-room apartments and two-room apartments, the latter remaining stable at 19.7% of the market. In 2025, according to S&P, housing prices will increase by an average of 3% annually, with a forecast of between 710,000 and 720,000 transactions, in line with 2024. Tecnocasa predicts price growth between 0% and 2%, distinguishing between high-end properties, which will appreciate in value, and properties requiring renovation, which may remain stable or see slight declines. The rental market will continue to see an increase in rental prices between 4% and 6%, especially in major urban centers and tourist locations. In general, according to the study, one of the key factors in the real estate recovery in 2025 will be the interest rate cuts by the ECB, which could lower them by 50 basis points. The Bank of England may also reduce rates by 100 basis points, and Sweden's Riksbank by 50 basis points. This scenario is expected to boost mortgage demand, making real estate purchases more accessible for both Italians and foreign investors.