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Italy boasts a rich cultural heritage, diverse landscapes, and cities that attract both tourists and real estate investors. From vibrant Rome, with all its rich history, to beautiful regions like Toscana or the Amalfi Coast, to smaller cities full of personality like Bari and to the fashion capital that is Milan, Italy has something for everyone.
Food, lifestyle, coffee, cars, it’s an European gem that once you’ve visited, you’ll be forever dreaming about going back.
Despite economic challenges in the past, Italy's real estate market has shown resilience, offering investment opportunities in various sectors such as residential, commercial, and hospitality.
With its strategic location, attractive lifestyle, and potential for growth, Italy emerges as an appealing choice for real estate investment in Europe, offering American investors a chance to diversify their portfolio and tap into a market with enduring value.
Over 74 million tourists visited Italy in 2022. We’re looking at one of the most popular destinations in the world, Rome, Venice, Milan, and Florence being some of the most often choices made by travelers.
With numbers like this, it means that if you consider renting your apartment through platforms like AirBnB, you will probably see a return on your investment.
Italy has also recently announced that it opened applications for digital visas, which opens the possibility of renting your asset, for long or short term stays, to digital nomads.
Financial considerations
Italy is ideal if you’re considering selling the property at some point, with prices rising every quarter by approx. 1%. It is not the cheapest country, with an average price of 5000 EUR per sqm, but it’s not the most expensive either, compared with the Nordics or with France or Switzerland.
Furthermore, there is so much variety in the landscapes, and property types. You’ve probably heard that you can buy historic residences, romantic old farmhouses, as well as high-end new constructions.
Buying real estate in Italy is also an easier process compared with other countries. To own a property here, you don’t have to be a resident, which significantly simplifies foreign ownership.
When it comes to the tax regime, it is important to note that there are several regions that have an optional tax regime, “which provides for the application of a substitute Irpef tax at a rate of 7 percent to any category of income produced abroad.” (source).
The average ROI of the Italian real estate market has been calculated to be, on average, around 22%, depending on the area - some areas obviously bring increased profits thanks to their localisation and tourism opportunities.
Research shows that gross rental yield in Italy, in this year’s first quarter, stood at 7,38%, similar to Q3 of last year, a sign of stability for potential investors.
Conclusion
Italy is a great idea whether you’re considering buying a holiday home or a rental. The country is an economic, educational, cultural, fashion hub that gives you enough opportunities either to enjoy the space on your own or to turn your investment into a business opportunity.
Whether you're drawn to historic cities, the tranquility of rural landscapes, or the romance of coastal towns, Italy's real estate market has much to offer to American investors seeking both financial returns and a slice of la dolce vita.
If you’d like to learn more about investing in real estate abroad with a profit, contact us.
