Milan and Rome continue to rank among the most important cities for Italy's luxury residential market. According to Savills, both cities performed strongly in 2024, with Milan experiencing substantial price stability and Rome showing growth. Forecasts for 2025 suggest a divergent trend that Milan is expected to maintain stable prices or see minimal variations, while Rome could see price increases ranging between 2 per cent and 3.9 per cent. Rental prices are also anticipated to rise, albeit with different dynamics in the two cities.
On an international scale, luxury property prices are expected to rise by 1.6 per cent in 2025, down from 2.2 per cent in 2024. However, the rental market has shown greater dynamism: in 2024, across the 30 cities monitored by Savills, prime residential rents increased by an average of 4.3 per cent, with significant spikes in Dubai (+23.5 per cent), Bangkok (+15.4 per cent), and Kuala Lumpur (+12.2 per cent).
Among the most expensive cities, Hong Kong remains the priciest for purchasing a luxury home, while New York has the highest rental costs.
Milan ranks 11th for property prices, which have remained stable compared to 2023, as per the report. Rome, on the other hand, is in 17th place with values on the rise, confirming greater dynamism than the Lombard capital.
In the prime rental market, Italian cities increased in 2024, with Milan ranking 7th after London and Rome 9th after Singapore. The growing demand for luxury rentals in both cities is driven by a limited supply and the arrival of new residents, whether for work or study.
Projections for 2025 indicate price stability in Milan, with a modest rise in rental values (below 2 per cent). In contrast, Rome is expected to maintain its positive trend from 2024, with luxury residential prices rising between 2 per cent and 3.9 per cent and rental growth of up to 2 per cent.
The cities expected to see the highest price growth next year include Dubai, with an anticipated increase of 8 per cent to 9.9 per cent, followed by Sydney, Madrid, and Lisbon, all projected to rise between 4 per cent and 5.9 per cent. These locations are characterised by strong demand and limited supply, key factors in driving property values higher. Barcelona and Cape Town also stand out for their expanding markets, supported by a shortage of high-quality stock and improving local economic conditions.
On the sales front, Rome presents a more positive outlook than Milan, thanks to more accessible prices that could encourage a rebound in transactions and a slow but steady increase in property values, particularly in new developments. Milan, on the other hand, faces a more cautious outlook, following the rapid price growth seen in recent years.
