Milan

Luxury Real Estate Market in Italy: Trends and Prices

By Columbus International,17 July 2024

The luxury real estate landscape in Italy shows a significant concentration in major cities, with Milan and Rome at the forefront. According to a recent analysis by Immobiliare.it, these two metropolises account for over a quarter of the country’s high-end property offerings.

Milan emerges as the undisputed leader, with about 16% of the national luxury stock, a trend that has been growing in recent years. Rome follows with nearly 11%, but shows signs of contraction. Florence, while ranking third, represents only 3% of the total offer.

At the regional level, Lombardy and Tuscany dominate the market, with 29% and 22.4% of high-end offerings respectively. Lazio ranks third with 14.8%.

Tourist destinations play a key role in the luxury segment. Como has seen an increase in offerings, while destinations like Forte dei Marmi have experienced a decline.

In terms of prices, Portofino stands out as the most expensive municipality, with an average of 19,074 euros/sqm. It’s followed by Villasimius in Sardinia and Capri. Tourist destinations generally surpass large urban centers in terms of cost per square meter.

Among regions, Valle d’Aosta leads the ranking with average prices of 9,173 euros/sqm, followed by Sardinia and Campania. Lombardy, despite its strong presence of luxury properties, ranks only fifth in terms of average prices.

This analysis highlights a dynamic and geographically diverse luxury market, with a clear preference for coastal and tourist locations in terms of property valuations.

Source: Monitor Immobiliare

Italy, Real Estate Market Evolution: A New Era of Opportunities for Buyers

By Columbus International,11 July 2024

The real estate sector is undergoing a significant transformation, ushering in a new era of opportunities for prospective homeowners and investors alike. Recent data from the Italian Revenue Agency reveals a market rebalancing that is fostering greater price flexibility and buyer-friendly conditions.

Fabiana Megliola, head of the Tecnocasa Group Research Office, reports an increase in the average discount to 8.3%, marking a shift from the recent period of intense market activity to a more reflective phase. This transition is creating a fertile ground for buyers to negotiate more favorable terms and secure better value for their investments.

A closer look at different property categories unveils intriguing market dynamics:

Used Properties: With an average discount of 8.5%, these offer the most room for negotiation. This presents an excellent opportunity for buyers to acquire properties at competitive prices and invest in custom renovations, potentially increasing long-term value.
Renovated Homes: Offering a 7.5% discount, these properties strike a balance between move-in readiness and value for money.
New Constructions: At a 4.5% discount, these remain attractive for those seeking modern, ready-to-use living spaces with minimal immediate maintenance needs.

Investors stand to benefit significantly in the current market, with discounts of up to 12% on investment properties. This trend could stimulate the rental market and provide more housing options in urban areas.

The market is also becoming more attuned to diverse buyer preferences. Ground floor apartments now come with more substantial discounts (8.5%), catering to those prioritizing accessibility or outdoor space. Top floor units, with a 7.7% discount, continue to appeal to buyers seeking views or added privacy.

While sales have slowed in the first quarter of 2024, this should be viewed as a market normalization rather than a downturn. This cooling period allows buyers more time to conduct due diligence, evaluate multiple options, and negotiate optimal terms.

In conclusion, the Italian real estate market is evolving towards a more balanced and sustainable model. The current landscape offers a unique confluence of factors – price flexibility, diverse property options, and a buyer-friendly environment – making it an opportune time for both personal home purchases and strategic property investments. As the market continues to adapt, it promises to better align with the changing needs and preferences of a new generation of property owners and investors.

Source: Il Sole 24 Ore

Milan: Real Estate Market Evolves Amidst Stability and Growth

By Columbus International,5 July 2024

Milan’s real estate market continues to demonstrate remarkable resilience, with contrasting dynamics between the sales and rental sectors. According to the latest report from idealista’s Research Department, Italy’s leading real estate portal, housing prices in the Lombard capital have stabilized in the spring quarter of 2024, settling at an average of €4,987/m².

Key points:

Stability in Milan’s sales prices (+1.4% year-on-year)
Continued growth in rental rates
Variable dynamics across different neighborhoods

Market analysis:

The Historic Center remains the most expensive area at €10,311/m²
San Siro-Trenno-Figino leads quarterly increases (+3.3%)
Vialba-Gallaratese records the most significant decline (-4.8%)

In the hinterland, a slightly negative trend is observed, with a 1.2% decrease and an average of €3,389/m². Assago emerges as the most expensive municipality (€3,647/m²), while Grezzago offers the most accessible prices (€1,054/m²).

The rental market, on the other hand, continues its upward trajectory. A 55-square-meter apartment in the heart of Milan now costs an average of €1,760 per month, highlighting increasing pressure on the rental market.

Andrea Napoli, CEO of Locare, offers insight: “The lack of adequate protections is pushing landlords towards short-term rentals, drastically reducing the supply for long-term residents.”

Key factors influencing this trend:

High purchase prices
Interest rates that remain elevated
Growing demand for tourist rentals

The future of Milan’s real estate market remains uncertain, but it’s clear that the city is undergoing a transformation phase, presenting both opportunities and challenges for investors and residents alike.

Real estate investments in Milan. An in-depth market analysis and numerous tips from Corriere della Sera

By Columbus International,27 June 202427 June 2024

In an ever-evolving real estate market, Milan continues to be one of the most attractive locations for investors. A recent study reveals that about 20% of real estate transactions in the Lombard capital are aimed at generating income. But how truly profitable is investing in Milan’s brick and mortar? Il Corriere della Sera has conducted a detailed analysis to shed light on this trend.

Comparing Returns: Real Estate vs. Government Bonds

To assess the actual profitability of real estate investments, we compared Milan’s rental yields with those of 8-year Italian Government Bonds (BTPs), currently at 3.2% net. Our analysis is based on standard 8-year free-market rental contracts, assuming a reliable tenant and regular payments.

The Milan Landscape: Data and Figures

Based on data provided by immobiliare.it, we examined a typical 70 m² apartment:

Average purchase price: €378,000
Monthly rent: €1,631
Gross yield: 5.17%
Net yield: 3.36%

It’s important to note that the net yield, considering taxes and expenses, is only slightly higher than that of BTPs, but carries significantly greater risks.

The Geography of Returns

Our research highlighted considerable disparities between different areas of Milan:

Historic center: 2.3% net yield
Premium areas (> €350,000 for 70 m²): yields lower than BTPs
Peripheral areas like Baggio and Ponte Lambro: yields up to 4.6% net

Milan’s Hinterland: An Interesting Alternative?

Extending the analysis to the province, surprising data emerges:

Average yield: 6.8% gross, 4.4% net
Top 3 for monthly rents: Gorgonzola (€1,156), Vimodrone (€1,084), Segrate (€1,075)
Municipalities with the best yields: Turibigo, Truccazzano, Tribiano (> 6% net)

These data suggest that the hinterland could offer more profitable investment opportunities compared to the city center.

Short-Term Rentals: The New Frontier?

The short-term rental phenomenon is gaining ground, promising higher gross returns. However, management costs, taxes, and platform commissions significantly erode margins. The profitability of this model seems to be limited mainly to specific areas of Milan.

Conclusions for Investors

Real estate investment in Milan can still offer interesting returns, but it requires careful risk assessment and deep knowledge of the local market. Investors should consider:

Location as a key factor for profitability
The potential for capital appreciation in developing areas
Management and maintenance costs, especially for short-term rentals
The financial stability of tenants for long-term rentals

In a market characterized by high prices and compressed yields, due diligence and a well-thought-out strategy are more crucial than ever for real estate investors in Milan.

Source: Corriere della Sera

Milan’s Next Cultural Powerhouse: Scirocco Hub Signals Urban Renaissance

By Columbus International,24 June 20249 November 2024

In a bold move set to redefine Milan’s cultural landscape, Lendlease and Mare culturale urbano have joined forces to birth Scirocco, a cutting-edge cultural hub in the burgeoning Milano Santa Giulia district, reports Il Sole 24 Ore. This 500-square-meter hybrid space, nestled within the Spark Business District, represents a fusion of art, commerce, and community engagement.

Positioned strategically in the Spark 3 building, Scirocco aims to become a vibrant nexus for cultural, musical, and sporting events, accessible to all Milanese citizens. Andrea Capaldi, the visionary co-founder and artistic director of Mare culturale urbano, envisions Scirocco as more than just a venue. “We’re creating a social and cultural beacon,” Capaldi asserts, “a space that will resonate with both current residents and future inhabitants of this evolving neighborhood.”

This innovative project is a cornerstone of Lendlease’s ambitious urban regeneration initiative for Milano Santa Giulia. Spanning over one million square meters, this development is poised to become one of Italy’s most significant urban renewal endeavors. At its heart lies a sprawling urban park, surrounded by a carefully curated mix of public amenities and services tailored for both individuals and businesses. Claudia Imparato, head of fund & asset management at Lendlease Italy, exudes confidence about the partnership’s potential. “Scirocco transcends the conventional notion of an artistic or retail space,” Imparato explains.

“It’s engineered to be a catalyst for social cohesion and inclusivity, fundamentally reshaping the neighborhood’s DNA.” Industry insiders view Scirocco as merely the opening salvo in a series of transformative projects slated for Milano Santa Giulia. This district is on track to emerge as a dynamic new hub in Milan’s southeastern quadrant, challenging traditional urban living paradigms and setting new benchmarks for city development. As Milan continues to cement its status as a global design and fashion capital, projects like Scirocco underscore the city’s commitment to cultural innovation and community-centric urban planning. It’s a clear signal that Milano is not just preserving its rich heritage, but boldly reimagining its future.

Source: Il Sole 24 Ore

Real Estate Market Rebalancing Offers Buyers Attractive Opportunities

By Columbus International,13 June 20249 November 2024

The real estate market is going through a transitional phase, moving from a period of strong euphoria to one of greater reflection. According to data from the Revenue Agency and the Tecnocasa Group, there is a decrease in residential property sales and an increase in the average discount applied to selling prices. In the second half of 2023, the average discount in Italy was 8.3%, an increase compared to the previous year.

This gap between the price requested by sellers and the price actually paid by buyers is widening, indicating greater caution in the market. The discounts vary depending on the type of property. Used properties suffer greater reductions (8.5%) compared to renovated (7.5%) and new (4.5%) ones, as they often require renovation work that entails additional costs. The most significant discounts, almost 12%, are recorded for properties purchased for investment purposes, where the buyer’s purchasing power carries more weight.

Economical properties and homes sold out of necessity suffer above-average discounts, respectively 10.2% and 9.6%. The position of the property also influences the discount: ground-floor apartments suffer discounts of 8.5%, while for those on the top floors, the discounts are more contained (7.7%). These data confirm the picture of a slowing real estate market. In fact, the Revenue Agency has recorded a sharp decline in residential property sales in the first quarter of 2024, equal to 7.6% compared to the same period in 2023 and 7.2% compared to the last quarter of 2023, affecting all areas of the country.

Source: Il Sole 24 Ore

In Milan, B&B Hotels Creates High-Tech Urban Sanctuary for Pollinators

By Columbus International,6 June 20249 November 2024

For modern travelers, luxury transcends mere comfort and premium services. A new trend is emerging where sustainability and environmental stewardship are becoming indispensable elements of an elevated travel experience.

B&B Hotels, a rapidly expanding European hotel chain, has astutely capitalized on this burgeoning movement. In the vibrant Cenisio Garibaldi district of Milan, B&B Hotels has unveiled “B&Bees” – an authentic urban biodiversity oasis on the terrace of one of their properties. This unspoiled natural enclave provides wild bees, butterflies, and other crucial pollinators with a sanctuary to find nourishment and refuge, facilitating the rejuvenation of local ecosystems.

“Environmental responsibility is woven into the fabric of our corporate ethos,” declares Liliana Comitini, the dynamic CEO of B&B Hotels Italia. “With B&Bees, we sought to curate an immersive space where our guests can bask in nature’s splendor while nestled in the heart of the city.” This initiative is the fruit of a collaboration with Beeing, a trailblazing urban beekeeping startup. Gracing the terrace are specially designed “Bee Hotels” – natural havens where pollinators can forage and propagate, shielded from the perils of the urban landscape. Surrounding these sanctuaries, a meticulously curated array of nectar-rich plants like lavender, jasmine, and wildflowers beckons these invaluable insect denizens. For Comitini, however, B&Bees represents merely the latest milestone in a longstanding journey. “Reverence for the environment is a paramount priority for us. This commitment is epitomized by our recent Socotec certification, which evaluates our impact on biodiversity, local economies, and community engagement.”

Significantly, 73% of travelers now deem a brand’s dedication to society and the planet as paramount. A proportion poised to escalate as environmental consciousness becomes an increasingly defining hallmark of true 21st-century luxury. B&B Hotels resolutely aspires to spearhead this sustainable revolution.

Milan’s Real Estate Frenzy: Where Savvy Families Strike Gold

By Columbus International,29 May 2024

When it comes to secure investments, real estate remains an evergreen favorite among Italians, especially in the vibrant city of Milan. The Milanese metropolis cements its position as a highly coveted destination for property investors, ranking an impressive third nationwide with a staggering 35% of purchases driven by investment motives – surpassed only by Pavia and Mantua. This figure represents a remarkable uptick compared to 2022 when the percentage hovered at a modest 23.5%. Remarkably, a commanding 85% of these savvy investors opt for cash transactions, underscoring their formidable financial prowess.

Milan’s Magnetic Pull for Real Estate Enthusiasts

While the majority of Milanese buyers (65%) acquire properties for residential purposes, the remaining contingent wholeheartedly embraces the age-old adage that real estate is the supreme investment. Purchasing apartments to leverage the lucrative rental market is an entrenched strategy, particularly in a city like Milan – a veritable crossroads for students and professionals seeking temporary lodgings. In 2023, a notable 16.6% of real estate transactions across the Lombardy region were spearheaded by investors, marking an approximate 2% escalation from the preceding year. The most active age bracket driving these investments falls between 45 and 54 years old, accounting for an impressive 31% of real estate investment activities. This demographic enjoys heightened economic stability and enhanced access to mortgage financing, although only 15% of Lombard investors opt for this payment route.

The Cornerstone of Family Investment Portfolios

A staggering nearly 70% of real estate investors in Lombardy hail from family units, underscoring the pivotal role of property as a strategic asset for numerous households. The two-room apartment emerges as the preferred property type among investors, captivating 47% of buyers, closely trailed by the three-room apartment at 23.3% of preferences. These compact dwellings cater to the burgeoning demand for affordable and conveniently sized accommodations from the city’s student and professional denizens.

An Enduring Investment Bastion

Despite the ebbs and flows of the real estate market, investing in property continues to represent a prudent choice for many Italians, with Milan at the forefront of this trend. The city presents an enticing environment for investors, bolstered by an unwavering demand for rental accommodations and the potential to generate stable, long-term income streams. While some opt for outright cash purchases, others strategically leverage mortgage financing to diversify their investment portfolios. Irrespective of the chosen path, real estate remains an unassailably tangible and reassuring investment for countless Italian families.

Milan, real estate prices on the rise with several surprises, from Garibaldi to Moscova, from Porta Nuova to CityLife

By Columbus International,8 May 20248 May 2024

According to analyses by the Tecnocasa Group Research Office, residential property prices in Milan increased by 0.1% in the second half of 2023, bringing the overall annual growth to 0.3%.

Central areas like Garibaldi, Moscova, Porta Nuova and CityLife witnessed a 2.1% surge in values, being highly sought-after by domestic and international buyers looking to live, work and study in the city. Demand concentrated on spacious properties exceeding 200 sq.m, with multiple bedrooms, outdoor spaces and top floor units.

The highest prices, peaking at €15,000/sq.m for sales, were recorded in the Porta Nuova district. Some semi-central neighborhoods like Lambrate, Navigli and Famagosta experienced a slight price decline, partly attributable to the abundant supply of new constructions. However, the rental market remained vibrant, with average monthly rents of €1,500 for a two-room apartment in central zones. The Vercelli-Lorenteggio macro-area saw a 1.6% price hike, fueled by growth in Lorenteggio-Frattini and Tolstoj. The Lodi-Corsica area witnessed a 1% increase, propelled by ongoing works for the Olympic Village development. Modest declines were observed in the Bovisa-Sempione (-0.7%), Central-Station (-1.6%) and Navigli (-0.5%) macro-areas, with varying trends across different neighborhoods. The Bovisa district was bolstered by the Scalo Farini redevelopment project.

Prices remained largely stable in the Città Studi-Indipendenza area, with localized increases along Viale Abruzzi and Corso Buenos Aires. Rental demand remained robust, driven by students and non-resident workers. In summary, Milan’s real estate market experienced modest yet consistent growth in 2023, underpinned by the central areas and large residential units, while exhibiting heterogeneous dynamics across various semi-central neighborhoods.

Source: Monitor Immobiliare
Photo: CityLife Residences

Rental Price Surge During Milan Design Week

By Columbus International,26 April 202426 April 2024

The Milan Design Week, an event of international renown, has recently rekindled the spotlight on the Lombard capital, attracting a vast and passionate audience of design enthusiasts from every corner of the globe. The record-breaking 62nd edition saw the participation of over 2,600 exhibitors and the influx of 600,000 visitors, registering a 15% increase compared to the previous year. This success was evidently reflected in the city’s rental market, where housing prices experienced a vertiginous surge.

Data provided by the property management company Italianway, specialized in short-term rentals, and reported by Il Sole 24 Ore, reveals that the average daily rate for an apartment in Milan during the 2024 Design Week was €386, with a peak of €414 on the night of April 17th, marking a 7.5% increase compared to 2023. But how much can a week’s rental cost during this event? For a studio apartment, the average cost hovers around €1,354, while for a one-bedroom apartment, the figure rises to €2,030. For larger apartments with three bedrooms or more, the expenditure easily exceeds €2,700. The highest prices are recorded for luxury apartments in the city center, which can reach the considerable sum of €7,000 per week.

A veritable boom that has made fortunes for property owners but has put a significant strain on the wallets of those seeking accommodation during the Design Week period. Several reasons contribute to explaining this surge in rental prices. Firstly, demand significantly exceeds supply. The event attracts visitors from all over the world, many of whom are willing to pay high prices for accommodation situated in the heart of the city, close to exhibition venues and collateral events. Secondly, the supply of available rental apartments is limited. Not all property owners decide to rent out their homes during the Design Week, and those who do often apply higher prices to take advantage of the high demand.

Source: Immobiliare.it