Gross rental yields in Italy range from low to moderate

Residential Valuation Specialist | August 14, 2018

Last Updated: Aug. 14, 2018
ROME - Historical Centre Apartments COST () YIELD (p.a.) PRICE/SQ.M. ()
TO BUY MONTHLY RENT TO BUY MONTHLY RENT
50 sq. m. 347,850 1,295 4.47% 6,957 25.90
120 sq. m. 790,680 2,584 3.92% 6,589 21.53
180 sq. m. 1,266,840 3,910 3.70% 7,038 21.72
300 sq. m. 2,419,500 8,808 4.37% 8,065 29.36
ROME - nearby suburbs apartments
EUR
150 sq. m. 687,750 2,288 3.99% 4,585 15.25
Pinciano
120 sq. m. 695,280 2,198 3.79% 5,794 18.32
MILAN - Historical Centre apartments
50 sq. m. 449,250 1,376 3.67% 8,985 27.51
120 sq. m. 1,002,600 2,837 3.40% 8,355 23.64
300 sq. m. 3,704,400 6,933 2.25% 12,348 23.11
MILAN - nearby suburbs apartments
Fiera
50 sq. m. 377,250 1,203 3.83% 7,545 24.05
120 sq. m. 846,840 2,671 3.79% 7,057 22.26
Moscova-Repubblica
50 sq. m. 333,900 1,435 5.16% 6,678 28.70
120 sq. m. 922,680 2,717 3.53% 7,689 22.64
VENICE apartments
San Marco
50 sq. m. 319,200 974 3.66% 6,384 19.47
100 sq. m. 611,700 1,993 3.91% 6,117 19.93
San polo
100 sq. m. 542,600 1,701 3.76% 5,426 17.01
FLORENCE apartments
50 sq.m. 243,100 989 4.88% 4,862 19.78
120 sq.m. 545,520 2,147 4.72% 4,546 17.89
All yields are gross - i.e., before taxes, repair costs, ground rents, estate agents fees, and any other costs. Net yields (what you´ll really earn) are typically around 1.5% to 2% lower.
Source: Global Property Guide Definitions: Data FAQ See also: Update Schedule

Gross rental yields in the historical centre of Rome, Milan, Venice and Florence - i.e., the return you can earn from rent, compared to the purchase price of a property, before taxation, vacancy costs, and other costs - range from 2.4% to 4.4%, with yields in all four places about the same. Yields on 120 square metre (sq. m.) apartments are really low in Milan, yields on smaller apartments a better.

Prices of apartments. Apartments in central Rome cost around €6,500 to €8,000 per square metre. Apartments in the wealthy suburbs of Rome cost on average between €4,500 to €5,800 per sq. m. Milan is more expensive, with apartments in the centre costing €8,900 to €12,400 per sq. m., and those in the suburbs costing €6,600 to €7,700 per sq.m. Apartments in central Venice cost around €5,400 to €6,400 per sq. m., and in the suburbs between €4,500 to 4,900 per sq.m., with yields in the centre of around 3.7%. Yields in Florence average around 4.7%

Conclusion: Property prices in Italy are beginning to look attractive. But gross rental yields are still poor, and Italy´s predatory taxation system doesn´t help.

Round trip transaction costs can be very high on residential property in Italy. See our Italy residential property transaction costs analysis and our Residential property transaction costs in Italy compared to other countries.

Comments

Sherif | November 21, 2017

Very useful, informative and professional reports. Thank you

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