Italy's residential property market gained momentum in the third quarter of 2025. Figures discussed here from the Italian Revenue Agency's OMI property market observatory suggested consolidation after years of uncertainty and slower activity. For agents, advisers and investors, the figures provided context for commercial and investment decisions at the time.

Property sales up 8.5% year on year

Between July and September 2025, there were approximately 174,892 residential transactions, an increase of 8.5% on the same period of 2024. The article linked this recovery to greater confidence, improved credit conditions, lower lending spreads and more accessible mortgages than in previous years.

Major cities lead the growth

Some urban markets stood out:

  • Milan: +11,8%
  • Palermo: +8,5%

Milan remained an important economic and residential hub. Palermo's performance suggested growing interest in major southern cities with further potential.

Existing homes versus new builds

The composition of the market was particularly revealing:

  • Existing homes: +10%
  • New builds: –9,6%

Existing homes often offer larger floor areas, central or near-central locations and competitive value. Some buyers choose renovation projects to personalise their homes or use incentives available at the time.

A further trend: interest in move-in-ready and already renovated homes had grown, especially in urban areas, partly because refurbishment costs and timescales can exceed expectations.

First and second homes: purchase motivations

In the third quarter of 2025:

  • First homes: 121,720 transactions (69.59% of the total)
  • Second homes: 53,172 transactions (30.41%)

The sizeable second-home share was presented as evidence of purchases for diversification, tourism or rental income as well as personal use.

The article associated this trend particularly with coastal areas, historic cities and well-connected villages where prices remained competitive compared with major centres.

Rental demand and changing contract types

Rental figures also showed activity:

  • New rental contracts during the year: +2,5%
  • Standard residential tenancies: –3,4%
  • Temporary tenancies: +3,7%
  • Agreed-rent tenancies: +8,8%
  • Student tenancies: +9%

Rental demand was growing while contract preferences were changing: standard tenancies were declining as more flexible or tax-favoured arrangements increased.

Growth in student contracts was linked to the return to in-person teaching and more students living away from home in major university cities.

A two-speed property market

Recovery was uneven. Major cities and urban centres benefited more, while many inland areas, peripheral districts and small municipalities lagged behind. Industry representatives warned of a widening divide between stronger and weaker markets.

The policy implication: a recovering market still needs housing policies that support less attractive areas where demand and property values remain weak.

A positive market that still needs careful analysis

The third quarter of 2025 offered an encouraging snapshot:

  • Residential transactions were growing.
  • Existing homes led the market.
  • Rental activity showed changing preferences.
  • Interest in second homes remained strong.

For property professionals, these figures offered a basis for commercial strategy, investment assessment and client advice at the time.

Even a strengthening market requires careful attention to local conditions and changing household needs.