The Italian real estate market in autumn 2025 – stability or another correction?

By autumn 2025, the Italian real estate market will once again be the focus of investors' attention. The European Central Bank's cycle of interest rate cuts, moderating inflation, and the reappearance of foreign buyers have all contributed to the market's recovery after the slowdown in 2023-24. At the same time, regional differences have widened, and investment decisions now require more caution than ever.

Regional differences and price movements

While property prices in Rome and Milan stabilized after the 2024 correction, coastal and tourist areas—Tuscany, Sicily, Puglia—continue to experience growing demand. International interest in properties purchased as "second homes" remains strong, particularly among German, British, and Scandinavian investors. In contrast, the luxury market is showing a slight decline: rising maintenance costs and energy efficiency requirements have reshaped demand.

Average prices are thus showing moderate growth of 2-3% nationwide, which points to a more mature and stable market. The Italian market is not about quick returns, but about secure, long-term value preservation – a particularly important consideration for Hungarian investors.

Tax reform and changes to investor regulations

The Italian tax reform that came into effect in 2025 was aimed at simplification and transparency, but it is worth paying attention to the changes affecting foreign owners. The calculation of the IMU property tax has been modified in several cities, and the extension of the flat tax system may make Italian tax residency more favorable in certain cases.

However, the new rules entail stricter tax reporting and rental obligations, so it is particularly important for Hungarian investors to review the local legal and tax conditions before making a purchase. Preliminary legal due diligence can not only provide security, but also often result in significant cost savings.

Financing environment and investor sentiment

Despite the easing of interest rates, Italian banks remain cautious about foreign borrowers. The down payment requirement typically ranges from 30% to 40%, and access to credit often depends on local banking connections. The market therefore favors prepared investors rather than quick buyers.

Nevertheless, the willingness to buy remains strong: the Italian lifestyle and stable legal environment continue to be a major attraction, while the government is trying to revive several regions, such as parts of southern Italy, with tax incentive programs.

Legal peculiarities worth paying attention to

Notarization is still mandatory for Italian real estate transactions, and all foreign buyers must have an Italian tax number (codice fiscale). A common mistake is that buyers overlook differences in inheritance law or the history of the property (ownership encumbrances, rights of use).

In the experience of Dr. Vásárhelyi Árpád Law Office, most problems arise because buyers do not seek prior legal advice, even though this is a fundamental safety measure in the Italian system.

It is worth thinking consciously and long-term

The Italian real estate market stabilized in the fall of 2025, but it is not without risks. For foreign investors, now is the time for prudent, legally sound decisions. A good knowledge of the local area, accurate tax planning, and professional legal support are the best guarantees that the "dolce vita" will be associated with real value growth rather than unpleasant surprises.