Italy's housing crisis is widely discussed. The figures examined in this article suggest that new-home production has not kept pace with household formation. We look at the shortfall, obstacles to construction, comparisons with Europe and the implications for a changing market.

Why are so few new homes being built?

New-build transactions account for a minority of Italian property sales. Complex administration, land-use planning difficulties and unauthorised construction are among the obstacles described. Many investors favour upgrading existing buildings or service-sector projects over new housing developments.

The picture: figures and context

Between 2018 and 2022, the number of households increased by 683,285 . Over the same period, official ISTAT data recorded building permits for just 224,105 new homes . Research by Cresme estimated that the number of homes actually built was 367,000 . Compared with household growth, these figures imply the following shortfalls:

  • ISTAT-based shortfall: 683,285 − 224,105 = approximately 459,000 homes
  • Cresme-based shortfall: 683,285 − 367,000 = approximately 316,000 homes

Depending on the dataset, new construction met only 33,8% (ISTAT) or 53,8% (Cresme) of emerging demand.

The housing shortfall

The difference between new households and new homes is only part of the picture. Lorenzo Bellicini, Technical Director of Cresme Ricerche, notes that existing housing and vacant properties must also be considered. Some unoccupied buildings, however, may be used for non-residential purposes.

Rising rents make decent housing harder to access for lower-income households. The article also highlights the need for social housing capable of serving a diverse and changing population.

Italy in the European context

The article's Euroconstruct comparison suggests that this shortage is not shared equally across Europe. Germany, Portugal and France invested more heavily in housing production relative to household growth. Examples include:

  • Germany: 380,000 additional households and 1,755,000 new homes (a 361.8% surplus)
  • France: 1,153,000 additional households and 2,279,000 homes (a 97.7% surplus)

The figures cited for Italy tell a different story:

  • Cresme estimates: 714,000 additional households and 467,000 homes (a 34.6% shortfall)
  • ISTAT estimates: 714,000 additional households and 279,000 homes (a 60.9% shortfall)

The article described Italy as having an unusually wide gap between demand and supply. It also cited property depreciation of 28–35% and a different recovery path after the 2008 crisis.

Challenges and prospects

The outlook described was complex: higher construction costs and a lack of consistent national housing policies made a market-only solution unlikely. The article reported that, from 2014 to its publication, the number of households had fallen by around 1,400,000 , while projections suggested household growth over the following ten years and a subsequent contraction. Some areas could become more attractive while others face depopulation.

Bellicini argues that national and local government need new forms of intervention that can adapt to rapid market change and respond to emerging housing needs.

Despite supply difficulties, well-designed new homes can offer important benefits:

  • Greater comfort: Modern design standards suited to contemporary living.
  • Energy efficiency: Up-to-date technology that can reduce energy use.
  • Less refurbishment work: A new home can avoid the expense and disruption of renovating an older property.

For buyers looking for innovation, sustainability and efficiency, a new-build home may be worth considering within a changing market.