More Than Half of Italian Homebuyers Are Paying in Cash — Who’s Driving the Shift?

Financing trends: mortgages are rising again, but habits persist

The data from Experian and the industry bodies shows a rebound in mortgage activity:

• Mortgage applications rose by more than 19% in 2025.
• Credit disbursements increased by 30.4% in the first months of 2025.

These figures show that banks and borrowers are re-engaging. Lower credit costs compared with the recent peak, targeted mortgage products and better underwriting models are part of the recovery. Still, the persistence of cash purchases suggests many buyers prefer to retain a no-debt position.

From an investor perspective, a mixed funding environment influences strategy:

• Lenders are again pricing risk and returning to markets with conservative loan-to-value ratios.
• Buyers who plan to leverage will find more mortgage options, but expect stricter affordability tests than pre-2019 norms.
• Sellers may need to adjust expectations where their market has a large number of mortgage-qualified buyers rather than cash-ready purchasers.

Risks and downsides of a cash-dominant market

We must be candid about the limitations of a market where more than half of purchases are paid in cash:

• Affordability for first-time buyers is squeezed. Younger buyers lack equity, which entrenches generational divides in property ownership.
• Price distortion: areas with heavy foreign or investor cash demand may see prices rise out of sync with local incomes, creating bubbles in specific pockets.
• Liquidity dependency: if savings are redeployed elsewhere — into equities or foreign assets — transaction levels may drop.
• Policy blind spots: taxation and regulation may not be tuned to a market where many transactions avoid mortgage oversight, complicating housing policy measures aimed at increasing access.

These risks do not make cash purchases undesirable, but they do suggest that a healthy market needs a balance between equity-driven and credit-driven demand.

Practical advice for buyers and investors

For buyers contemplating the Italy real estate market, here are concrete considerations drawn from the data and our reporting:

• If you have cash: weigh the benefit of lower overall cost against the opportunity cost of deploying savings elsewhere. Sometimes a small mortgage at attractive terms can preserve liquidity while keeping financing costs manageable.
• If you need a mortgage: act sooner rather than later while lenders continue to expand credit lines; expect lenders to apply strict affordability tests and to prefer borrowers with stable income and significant down payments.
• For investors: focus on markets with sustained rental demand if you plan to hold, and expect competition from cash buyers in prime locations.
• For first-time buyers: consider shared-equity options, family-assisted purchases or regional markets where prices and required deposits are lower.

We find that negotiating strength still tilts to cash buyers in many transactions. However, well-prepared financed buyers who can demonstrate quick loan approval also win deals where sellers value certainty.

Policy implications and what this means for the market going forward

Policymakers should monitor three areas closely:

• Access to housing for younger households: with cash buyers dominant, targeted measures may be required to increase mortgage availability or offer alternative affordable pathways to ownership.
• Transparency and data: a high share of cash transactions can reduce loan-level visibility, making it harder to assess systemic risks; better disclosure of transaction types across regions would help.
• Taxation and incentives: governments could consider tax tools to balance second-home investment and primary-residence affordability without deterring productive capital flows.

In our view, a functioning housing market needs both credit and equity participants. The current mixture in Italy underlines that capital availability matters, but so does the capacity of families and individuals to access credit when needed.

Conclusion: Liquidity is propping up activity, but structural gaps remain

The snapshot is clear: more than half of home purchases were made in cash in the first half of the year. This has supported prices and kept transactions flowing while mortgage markets recovered. Yet the data also reveals a structural gap: younger buyers are underrepresented among cash purchasers and rely on credit conditions that remain stricter than a few years ago.

For buyers and investors, the lesson is straightforward. If you are cash-ready you will find negotiating advantages and speed. If you require financing, expect a market where both lenders and sellers demand robust documentation. For policymakers, the challenge is to ensure that access to homeownership does not become the preserve of those with long-accumulated wealth.

Our final practical takeaway is this: when more than half of transactions are paid without a mortgage, the Italy real estate market is being driven as much by saved capital as by lending. That fact should shape buying strategy, financing plans and public policy discussions going forward.

Frequently Asked Questions

Q: How common are cash purchases in Italy right now?

A: Very common. Tecnocasa reports that 51.4% of purchases in the first six months were made entirely in cash.

Q: Who are the typical cash buyers?

A: Typically middle-aged buyers and couples with accumulated savings. Buyers aged 45–54 accounted for 24.8% of cash purchases, and couples/families made up 66% of these transactions.

Q: Are mortgages making a comeback?

A: Mortgage activity is increasing: loan requests rose by more than 19% in 2025, and credit disbursements to households increased by 30.4% in the first months of 2025. Still, many buyers prefer to purchase outright.

Q: What does this mean for first-time or young buyers?

A: It means tougher competition. Young buyers under 34 hold only 17.3% of cash purchases and may face affordability barriers unless mortgage access improves or alternative support mechanisms are introduced.