Increase in investment purchases, an increase in the average age of buyers, an increase in the percentage of people moving from large cities to the countryside, and growth in contracts for university students and those of a transitory nature. These are the trends in the Italian real estate sector in 2023 highlighted at the Tecnocasa conference “Regenerate to anticipate the future.”
More Purchases for Investment
“Despite the first part of 2023 showing a real estate market in a significant slowdown, with a consequent slowdown in sales and the growth of prices and rents, there is no sign of a decrease in small investors who, according to our data, are increasing, mainly driven by the desire to protect capital and engage in short-term rentals, thanks to the significant tourist flows that are affecting our country,” commented Fabiana Megliola, head of the research office of the Tecnocasa group. The data, related to the sales made by the agencies of our group, have indeed highlighted an increase in the percentage of those purchasing for investment, at a national level, from 16.8% at the end of June 2022 to 19.6% by the end of June 2023.”
“This is the highest share recorded in the last 5 years,” added Piero Terranova, an analyst at the research office of the Tecnocasa group. Milan continues to attract investors’ interest, also thanks to the numerous regeneration interventions planned in the city. “Among the big cities, Milan has ranked on the podium; investment purchases now make up 39.1% of sales, a much higher share compared to previous years when it ranged between 23 and 27%,” said Piero Terranova.
Buyers’ Profile
Although the data shows, at a national level, an increase in the average age of buyers, which stands at 43.8 years, another trend to look at is the progressive growth in the percentage of purchases by singles, which in 2023 has exceeded 33%, while in the remaining 67%, it concerns families. In Milan, however, the percentage of purchases by singles is even higher and has exceeded 50 percent.
Sales Volumes and House Prices
“In the first half of 2023, residential sales in Italy were 350,855, with a decrease of 12.5% compared to the same period in 2022,” illustrates Megliola, who speaks on the one hand of a desire to buy among families, but on the other hand of a cautious attitude among potential buyers, with sales expected at the end of the year around 680 thousand, down from about 785 thousand in 2022.
It should be noted that, among the big cities, the most significant reductions in volumes were recorded in Bologna (-23.3%), Bari (-22%), and Milan (-20%).
Percentage Change in Prices during the 1st half of 2023 vs. the 2nd Half of 2022
In the first six months of 2023, housing prices saw a decline in their growth, particularly in big cities, which recorded a modest increase of 0.6%. Genoa (-1.0%) and Florence (-0.9%) are noted to have returned to negative territory, but also the strong slowdown experienced in Milan (+0.2%) and Bologna (+0.1), which, in the previous semesters, had significant increases in values. The highest growth (+1.9%) was recorded in Naples, while Rome closed the semester with +0.7%.
It is important to note that in Milan, prices have risen by 38.2% in the last 5 years, from 2018 to 2023, especially those in the suburbs that have increased by over 45 percentage points.
Source: Tecnocasa group research office
The Italian Rental Market
The rental market, after the sharp drop in values that occurred in 2020, immediately recovered after the lifting of restrictions. Rental prices continued to grow at a sustained pace, but in the first half of 2023, there was an evident slowdown: +3.4% for studio apartments, +3% for two-room apartments, and +3.2% for three-room apartments.
“Milan takes the first place as the city with the highest monthly rental prices (775 euros for a studio, 1068 euros for a two-room apartment, and 1453 euros for a three-room apartment) – explain the experts at Tecnocasa – Verona is the one where rental prices have grown the most on average in the first part of 2023 (+4.4% for studios, +3.6% for two-room apartments, +3.9% for three-room apartments).”
