Italy’s housing market is showing signs of recovery, with residential sales rising 4.5% year-on-year in the second quarter of 2025, according to flash statistics released by the National Institute of Statistics (Istat). The increase marks a shift for a sector that had been under pressure following monetary tightening in 2022 and is now benefiting from more relaxed financial conditions and renewed buyer confidence.
Between April and June, 255,639 notarial deeds of sale were registered, with over 240,000 relating to residential properties and the remainder concerning commercial real estate. The overall figure represents a 4.1% increase year-on-year, although a 2.3% decrease compared to the first quarter was recorded, when accounting for seasonality.
The recovery is unevenly distributed across the country. The North-West region is leading the expansion, with a 7.6% increase in sales, followed by the Islands (6.5%), the North-East (5.6%), and the South (4.2%). The Centre region, however, experienced a contraction of 3.3%.
The trend for non-residential properties presents a different picture, with sales of commercial real estate declining compared to the same period last year, indicating a slowdown in the productive and commercial sectors. This suggests caution in interpreting the recovery as structural.
A key driver of the recovery is the resurgence of credit availability. Notarial deeds for mortgages and hypothecary loans reached 100,717, an 18.1% increase compared to the second quarter of 2024. 65.9% of purchases were financed through mortgages, with an average loan-to-value ratio of 78.4%. This level brings the market closer to pre-2022 volumes, when rising interest rates had sharply cooled demand.
“This data confirms an improvement in financial accessibility for families and strengthens the role of credit counseling in supporting sustainable choices,” said Andrea Cobianchi, Commercial Director of WeUnit.it. “Financial leverage is once again central to purchasing decisions. The evolution of access to credit conditions is crucial not only to support demand but also to promote a greater balance between prices and spending capacity.”
Despite the encouraging signs, challenges remain. Rising prices, coupled with a contraction in available supply, risk compressing housing affordability, particularly in major urban centers. The growth of short-term rentals, which removes properties from the traditional market and fuels tensions in rental prices, is also a contributing factor. Without an increase in housing supply, sustained demand driven by credit could lead to further inflation in property values rather than a genuine expansion of the market.
According to Istat data released February 17, 2026, real estate sales agreements decreased by 2.3% in the second quarter of 2025 compared to the previous quarter. Istat also reported on February 13, 2026, that consumer price indices are undergoing changes with the adoption of a new classification system, ECOICOP, in 2026. A national statistical program covering 2023-2025 is currently underway, involving 2,533 municipalities and approximately 1.5 million families and individuals, as reported by Istat on October 6, 2025.
The sustainability of the recovery will depend on three key factors: increasing the housing stock, implementing more effective public policies, and providing financial instruments tailored to families’ actual repayment capacity. Without these factors, the current expansionary phase risks remaining cyclical rather than structural.
Istat’s annual report for 2025, published in May 2025, illustrates the economic, demographic and social changes of the past year, offering an integrated information framework on the main challenges facing Italy.
