Italy: A Real Estate Overview

In 2025, the Italian real estate market recorded investments of approximately EUR12.4 billion, the highest level in the last six years and close to an all-time high. According to an analysis by Dils (a leading company operating in real estate services), this performance reflects the high level of confidence of domestic and international investors in the prospects and solidity of the Italian real estate market.

The retail and hospitality sectors continued to be the most dynamic asset classes in the Italian real estate market in 2025, distinguished by their strong ability to attract capital.

The logistics sector recorded an annual investment volume of EUR2.2 billion, marking a 31% increase compared to 2024. The office sector closed 2025 with a 14% overall annual decline, reflecting a market that remains selective but dynamic in higher-quality operations.

The residential sector has consolidated its position among investors' favourite asset classes, returning to levels in line with 2022, the year that saw the sector's best performance.

In the last quarter, investments reached approximately EUR330 million, bringing the total year-to-date figure to over EUR1 billion, an increase of more than 70% compared to 2024. The sector's performance was primarily driven by student housing, which doubled its investment volume year over year.

In 2025, the national rental market showed marked dynamism, with a 16% annual increase in registered contracts, exceeding the 1 million threshold for the first time.

As reported by Scenari Immobiliari, a differentiated trend emerges among the main urban centres in terms of prices. Milan has consolidated its leadership. Growth is driven primarily by central and semi-central areas, where demand remains very high. Rome shows more moderate growth, supported by the recovery of central neighbourhoods and interest in luxury properties. Turin, Bologna, Florence and Naples also show increases in demand and average prices, ranging between 1.5% and 3%.

In the European context, Italy is establishing itself as a major real estate driver, standing out for its solid fundamentals and its ability to attract capital even in a global landscape characterised by high complexity and uncertainty.

The Challenges of Italian Legislation

Italy's efforts to improve its regulatory framework continued significantly in 2025. First, on 30 January 2025, the Ministry of Infrastructure and Transport published guidelines and interpretative criteria for the implementation of Decree-Law No 69 of 29 May 2024, converted, with amendments, by Law No 105 of 24 July 2024 (the “Salva Casa Decree”).

The document provides fundamental guidance for the application of the Salva Casa Decree, a law that introduced important provisions, among other things, regarding proof of the legitimate status of properties, changes of use and the regularisation of building works.

Among the key legislative measures approved in 2025 is Law No 182 of 2 December 2025 (informally referred to as the “Simplification Law”), which, inter alia:

• reduced the deadline for an administrative measure to be annulled ex officio by the Public Administration from 12 to six months;
• extended the application of tacit consent to building permit applications for interventions on listed properties;
• introduced measures to support the tourism and hospitality sector; and
• introduced measures aimed at providing greater stability, certainty and guarantees for the transfer of properties acquired through donation (a reform strongly supported by the National Council of Notaries).

Another key step taken by the legislator to improve the regulatory framework was the launch of the process leading to the approval of a new Building Code. Once approved, the measure will require the government to enact the new Building Code.

The aim is to replace the current Building Code (Presidential Decree 380/01) through a comprehensive rewrite that will provide greater certainty regarding key issues such as:

• the legal classification of construction projects;
• the required building permits; and
• the limits of the respective competencies of the state, the regions and local authorities, while also ensuring the simplification of administrative procedures.

The approval of this reform is strongly desired, as the current regulatory framework is the result of complex layers of legislation that have given rise to several jurisprudential conflicts.

Another important area in which national and regional legislators are engaged is the regulation of data centres. To date, Italy lacks comprehensive and detailed legislation regarding the construction of this type of technological infrastructure. Therefore, both at the national level and in some regions, bills are pending to regulate the establishment, construction, development and modernisation of data centres.

The Main Future Challenge: Certainty and Speed of Procedures

In Italy, important reforms have been approved in recent years aimed at shortening timelines and simplifying procedures for issuing and finalising building permits. However, there are still delays in the practical activities of local administrative offices, as well as interpretative uncertainties relating to the relevant legislation.

A key challenge that the Italian real estate sector must face, therefore, concerns achieving a higher level of certainty and efficiency in the administrative procedures required to obtain building permits and other authorisations for real estate development and redevelopment projects.

The national legislature is aware of these issues, and the goal of ensuring greater certainty and stability in the sector appears to be clearly identified. It is therefore hoped that further reforms will be approved soon, thereby enabling a more efficient response to community and market demands.