Cases: due to high prices, people are increasingly looking for smaller options (but they are not available in the market).

With the rise in interest rates affecting mortgage costs and the ongoing increase in real estate prices, a new type of housing has emerged: buyers are increasingly looking for smaller apartments, averaging around 118 square meters, with three or more rooms. However, sellers continue to offer larger apartments that exceed 127 square meters and have at least four rooms. This data was released in the first study conducted by Century 21 Italia, the representative of the American real estate brand, and Wikicasa, a platform that collects and analyzes market information, providing users with reliable data to simplify transactions. This analysis covers cities such asMilan, Rome, Turin, Bologna, Florence, Naples, Catania, and Palermo.

The gap between supply and demand

At the beginning of 2024, it is observed that many sellers are putting three-bedroom apartments or even properties with five or more bedrooms on the market. At the beginning of 2023, the situation was completely different: buyers were looking for apartments with an area of about 130 square meters, while by the end of the year, interest shifted to residential properties with an average area of 125 square meters, and by the beginning of 2024, this figure had decreased to 118 square meters. The reasons for such a change are varied. According toMarko TileziAccording to the CEO of Century 21 Italia, "recent global changes in the sector have influenced such shifts: we have moved from extremely favorable lending conditions to a sharp increase in mortgage rates. Right after the pandemic, the conditions were convenient, and the demand for larger homes was rising, but now there is a shift towards more compact solutions, especially in major cities."

Reasons for changes and new prices

As already mentioned, "the sharp rise in rates is the main factor behind this change, but not the only one."Matya KolantuoniCo-founder of Wikicasa adds that it is important to analyze the "essence of demand": buyers may have different motivations, whether it be housing needs or investment goals.

State of the rental market

If there is a clear imbalance in the sales market (it was recorded at the beginning of 2024238,000advertisements against almost30,000the rental market remains stable: in the first months of 2024, there are22,000requests have to23,000proposals. However, economic difficulties are also evident here: "Problems with obtaining loans and a new concept of living together, along with the boom in short-term rentals, according to experts from Wikicasa, are leading to a rapid saturation of the rental market, creating a real 'shortage' in this sector." According to the study, the rental apartments are generally larger than what potential tenants are looking for: the average area of the listings is81 square meters, while demand —69 square metersLandlords mainly offer two-room apartments.7000ads) and three-room apartments (5000The price barrier remains an issue: tenants are willing to pay on average700 euroswhile property owners are focusing on rental rates slightly higher1000 euros.

The specifics of Milan

Milan remains one of the most attractive cities in Italy; however, according to an analysis by Century 21 Italia and Wikicasa, interest in buying property in this city has sharply declined. At the beginning of 2023, around1400the number of requests, and a year later it decreased to1000what constitutes30%losses. From the supply side, many sellers took advantage of the rising prices — the number of properties listed for sale increased from4751more than6000In Milan, there is also the most pronounced gap in prices: owners are offering apartments at an average of470,000 euroswhile buyers are looking for housing priced around268,000 eurosIn this city, the least requested housing has also been recorded: on average, about68 square meters.

The situation in the real estate market in Rome

Rome is showing a different dynamic in the market: here, the demand for apartments has increased from more than1300requests at the beginning of 2023 until1800In 2024, the average area of the requested housing is significantly larger than in Milan —89 square metersThere is also a price gap, but it's less sharp: those who are looking are guided by the price in260,000 euros...while those who sell display the items from...340,000 eurosIn the capital, the rental market remains a weak point: at the beginning of 2024, the total number of rental requests is2300The ads only reach1300with average prices1400 euros— significantly higher than the national average.