Investing in Italy: The Best Regions for Real Estate in 2025

Italy’s property market continues to capture the imagination—and capital—of international investors. Whether you're looking for a second home, a long-term rental opportunity, or a lifestyle investment with strong emotional and financial returns, Italy offers a unique blend of value, heritage, and growth.

But where exactly should you invest in 2025?

The real estate market in Italy is deeply regional. Prices, rental yields, demand, and legal structures vary widely from north to south, from coastal towns to Alpine villages. This guide outlines the top regions for real estate investment in Italy this year—based on value, long-term trends, and the growing appetite from global buyers.

1. Lombardy – High Liquidity and International Appeal

Lombardy, and in particular Milan, remains the most dynamic real estate market in Italy. Milan is not just the country’s financial hub—it’s also its most international city, attracting foreign professionals, students, and investors alike.

Real estate here benefits from:

• A strong rental market, both long- and short-term

• Increasing demand from digital nomads and international families

• Infrastructure upgrades, including high-speed rail, airports, and metro expansion

• The presence of top universities, corporate HQs, and consulates

Outside Milan, Como and Varese offer more affordable luxury, attracting both Swiss buyers and remote workers seeking beauty, peace, and proximity to the Alps.

2. Tuscany – The Classic Lifestyle Investment

Tuscany remains a safe haven for lifestyle-driven investors. While Florence continues to be a hotspot for short-term rentals and international education, the real opportunities in 2025 lie in second-tier towns like Lucca, Pistoia, and the Chianti countryside.

Here, buyers find:

• Authenticity with lower prices per square meter

• A strong market for villa rentals, weddings, and boutique hospitality

• Growth potential in long-stay tourism, especially post-COVID

Unlike saturated areas like central Florence or Siena, these quieter Tuscan zones offer better margins and more flexibility—ideal for mixed-use or buy-and-hold strategies.

3. Apulia – Southern Growth and 7% Tax Incentives

If you're looking for high yield and long-term upside, Apulia (Puglia) deserves your attention. With its whitewashed villages, turquoise sea, and Baroque architecture, it’s now attracting digital nomads, expat families, and early-stage investors.

Key drivers:

• The 7% flat tax regime for foreign retirees in southern towns

• A growing network of luxury hospitality brands and agriturismo ventures

• Direct international flights via Bari and Brindisi

Areas like Ostuni, Polignano a Mare, and the Valle d'Itria are gaining international recognition, but still offer properties well below northern Italian prices.

4. Sicily – Heritage Meets Affordability

Sicily offers unmatched charm at rock-bottom prices. Yes, infrastructure can be inconsistent—but for long-term investors willing to be patient, it presents serious upside.

The market here is driven by:

• Lifestyle migration: retirees, creatives, and slow-living enthusiasts

• The €1 homes program has brought new visibility to remote areas

• A boom in demand for renovated historic homes near towns like Modica, Noto, and Palermo’s old town

Sicily is also increasingly seen as a base for expats who work remotely but want a lower cost of living without leaving Europe.

5. Lake District – Exclusive and Resilient

For ultra-high-net-worth investors, the Italian lakes remain the gold standard. Properties around Lake Como, Lake Garda, and Lake Maggiore continue to attract international capital, particularly from Switzerland, the US, Germany, and the Middle East.

The appeal here is long-standing:

• Proximity to Switzerland and Milan

• Timeless value and liquidity

• Access to international schools and services

In 2025, the top-performing segments are expected to be waterfront villas, restored historical homes, and eco-luxury properties aimed at wealthy expats and second-home buyers.

6. Rome and Florence – The Dual Market Model

While often seen as mature markets, Rome and Florence still offer interesting dynamics. Prices have remained relatively stable, which makes them ideal for capital preservation, especially for investors coming from more volatile real estate markets.

Florence benefits from a steady stream of American and British buyers, while Rome’s market is more driven by domestic demand and institutional renters.

In both cities, premium central neighborhoods (like Prati, Trastevere, or Oltrarno) show strong short-term rental potential—with careful attention to local regulations.

Conclusion: Strategy Before Square Meters

Investing in Italian real estate in 2025 is less about speculation and more about strategic positioning. Whether you're diversifying your global portfolio or buying your forever home, Italy offers an exceptional combination of culture, lifestyle, and opportunity.

But choosing the right region is only the first step. Navigating the bureaucracy, tax system, and inheritance rules requires experience—and local guidance.

Thinking About Buying Property in Italy?

At Knotted, we help international buyers find and secure the perfect investment—whether it’s a lakeside villa, a Tuscan farmhouse, or a city pied-à-terre. We guide you through tax planning, due diligence, and cross-border legal compliance, every step of the way.

📧 Email us at: info@knotted.ch

📱 WhatsApp anytime: +41 76 771 30 22

Let’s turn your Italian dream into a smart, solid investment.