Italy’s luxury real estate market is coming off a strong year, as its lifestyle and appeal among remote workers continued to draw home buyers.
Four of Italy’s major cities saw luxury home values increase by 1.8% in 2023 compared to the prior year, and second-home locations saw an increase of 6.7%, according to a report from London-based real estate brokerage Savills on Tuesday.
A hub for innovation and education, Milan had the highest price per square meter for prime residential property in Italy, ringing in at $17,371 per square meter, which was up 0.9% in 2023.
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Italy’s capital holds historical landmarks and cultural institutions making it a hot spot for tourists, helping Rome experience a 2.2% increase in prices and rents in 2023, a trend Savills predicted will continue.
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Meanwhile, Florence saw an increase as well, coming in at €9,600 per square meter, up 3.5% in 2023.
Sicily has seen renewed interest from domestic and international buyers thanks to the television and film industry. In 2023, the city recorded a growth of transactions in the property market, up 11.3% since 2019. Property prices have remained stable, according to Savills.
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The Italian Lakes have been a long time hot spot for second home buyers, from Hollywood celebrities to world leaders. Prime prices were led by Lake Como, at €10,300 per square meter, up 19.9% in 2023.
Rising tourism has helped bolster demand in the prime property market in Italy. International buyers accounted for 40% of the prime market in Florence, for instance, according to Savills.
Buyers in Italy are now more location agnostic, allowing them to look for the best properties with features and amenities, according to Savills. Prime amenities include waterfront or countryside views and large terraces.
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Second-home and non-city markets have drawn international demand as well, driving price growth in markets like Lake Como and Portofino, where housing supply is tight.
Second-home buyers are also interested in Italy’s historic properties, trophy assets and close location to major business hubs.
It’s expected that the current demand in the market will expand to other desirable areas in Italy. Savills forecasted that second-home locations in particular will continue to see a price growth.