In the last three months of 2025, the Italian real estate sector showed unexpected signs. According to preliminary estimates, the house price index (IPAB) rose 0.9% quarter-on-quarter and 4.1% year-on-year, accelerating from +3.7% in the previous quarter.
But what is most striking is not so much the overall growth, but the differences between new and existing housing and between different regions of the country. 2025 closes with average house price growth of 4%but looking in detail a strange phenomenon emerges. Existing homes registered an increase of 4.7%, while new homes are practically at a standstill, with a modest +0.6%.
In the fourth quarter, the trend of existing housing growth was 5.2%versus a 1.2% drop for the new. Even on a cyclical basis, IPAB growth (+0.9%) reflects two opposing dynamics: +1.3% for new dwellings and +0.8% for existing dwellings.
Rome and Milan had the highest percentage of home values in 2025
A detail that anticipates a wider trendwhich will inevitably affect the next year as well. Sales volumes, however, are showing a significant slowdown: in the fourth quarter of 2025 growth was just 0.4%, compared to +8.5% recorded in the previous three months.
Another key element concerns geographical differences. Price growth was strongest in the North East (+4.9%)while the South and the Islands (+3.6%) show more moderate performances. In terms of housing typology, growth is almost exclusively in existing housing: in the northeast it was +6%, in the northwest +4.4%, in the center +4.4% and in the south and the islands +4.5%. On the contrary, the new houses show little or even negative changes in some areas.
Even big cities follow different trends. Milan and Rome lead the rankingIn fact, between October and December, prices in the capital of Lombardy rose by 6.3%, in Rome by 5%. Overall for the year, Rome recorded the most sustained growth at +5.1%, while Milan slowed to +3.3%, the lowest rate since 2018.
However, in large cities, the real estate market is becoming less and less accessible to the middle class. In Milan, an income of around 59 thousand euros is not enough to buy a house without committing up to 35% of the income to a mortgage. In Rome the situation is similar, with 36% of the income needed for incomes around 33 thousand euros. Only those who know the little secrets of the market know how to move so as not to be crushed by this dynamic.
