Real estate, bleak autumn: Bologna recorded the largest decrease in real estate transactions in Italy.

The Italian real estate market is facing rising inflation and housing prices, but a decrease in transactions. Autumn2023 promises to lead to a reduction in real estate during what is traditionally considered the most advantageous period for buying a home - the fourth quarter of the year.

In Italy, from September to December, the sale of approximately192,177 properties is expected, an8% decrease compared to the same period last year. Comparing data on the expected number of transactions in the fourth quarter of2023 in the10 largest cities in Italy, the largest number of properties is expected inMilan -10,920, more than twice as many as inRome (4,813) and Turin (4,041). They are followed by Bari (3,396), Bologna (2,386), Genoa (2,199), and Naples (2,051). At the bottom of the rankings are Palermo (1,699), Florence (1,298), and Catania (1,014).

From2011 to2022, the fourth quarter of the year on average turned out to be the period with the highest number of transactions: the peak was in2021 with212,740 transactions. These are some of the results revealed in the report "Real Estate in Italy: Forecasts for the end of2023", compiled by Reopla, a company belonging to the Sprengnetter group specializing in analyzing big data and developing innovative software and AVM (automated valuation models) for real estate. The research is conducted using AgentPricing, the most popular online real estate valuation service among real estate agencies in Italy (source: OID2021), which allows providing more objective and professional property valuations to their client-sellers.

** The analysis compares real estate transactions in Italy from the fourth quarter of2011 to2023, forecasting for the autumn period of the current year. Real estate market in Bologna: how transactions progressed in previous months. After the pandemic, real estate faced growth, moving from over558 thousand transactions in2020 to784 thousand in2022, which became the year of the greatest market expansion in the last decade of2011-2022. In2023, despite the recent rise in interest rates, the market decline will continue to follow historical trend: AgentPrincing data confirms, as predicted by the Institute of Statistics, a gradual slowdown, exacerbated by inflation and mortgage rate increases, but this is mitigated," says Patrick Albertengo, co-founder and CEO of Reopla. "In the last quarter of the year, we expect real estate sales nationally to decrease by8%, especially in large cities. Compared to metropolises, provinces are more affected by periods of contraction and are the last to benefit from market normalization: this is clearly seen, for example, in Bologna and Bari, two cities where the greatest decline in autumn transactions is observed, respectively -14% and13%."

Milan has the highest number of fall deals Among Italy's 10 largest cities, Milan is expected to have the highest number of deals in the fourth quarter of 2023, with 10,920. This is a decrease of 11% compared to the 2022 period. It is also worth noting the difference in volumes between city and province: the latter expects only 5,534 deals, 23% less than in the fall period of 2022.

Rome: buying and selling in the province more often than in the city In contrast toMilan, in the capital, transactions in the province are expected to total 9,241 in the fall compared to the 4,813 registered in the city; this is, however, a decrease of 10% and 12% respectively compared to the same period in 2022. In contrast to Milan, Rome has seen a decline in prices per square meter in recent years: comparing the first half of the year, in the city they fell from € 3,062 in 2016 to € 2,768 in 2022; in the province, from € 1,456 to € 1,285.

As already mentioned, Bologna is the city in Italy where real estate transactions are expected to decrease the most in the fourth quarter of 2023: -14% compared to the same period of the previous year, with a total of about 2,386 transactions. The province is expected to see an even bigger decline of -23%, with 1,255 transactions. In Bologna, in the city and in the province, prices per square meter have remained roughly stable from 2016 to 2022: an average of € 2,800 in the city and € 1,400 in the province.

Renting: Bologna among the most expensive cities

Bari -13% of transactions in the city and province For the fourth quarter of 2023, the Pula capital is expected to sell around 3,396 properties in the city and 1,224 in the province: both areas, however, will experience a 13% decrease compared to the same period of the previous year. In Bari also, prices per square meter remained stable from 2016 to 2022: € 1,600 in the city, € 1,100 in the province.

Situation in other cities For the fall of 2023, about 2,051 properties are expected to be sold and bought in Naples and 3,643 in the province with an expected decrease of 7% and 6%, respectively, compared to the same period of the previous year. In Naples, real estate prices have declined slightly in recent years, with the lowest value recorded in the first half of 2020 at € 1,918 in the city and € 1,485 in the province.

For the fourth quarter of 2023, Turin is expected to sell about 4,041 properties in the city and 5,525 in the province: a decrease of 7% and 9% respectively compared to the same period of the previous year. Prices per square meter have remained roughly stable in all years: around € 1,000 in the province, with a slight decrease from 2020 onwards; average around € 2,000 in the city, with an upward trend in the last two years.

As in Turin, in the Florentine capital, transactions in and out of the city tend to level off: for the fall of 2023, about 1,298 properties in Florence and 1,827 in the province are expected to be sold. The decrease is respectively 9% and 11% compared to the same period of the previous year. The average price per square meter for all years is € 2,700 in the city and € 1,700 in the province.

Among the 10 largest cities in Italy, the least significant decline in autumn transactions is expected in Palermo: they will decrease by only -4% in the city, with 1,699 transactions, and by -1% in the province, where 1,595 transactions are anticipated compared to the same period last year. From 2016 to 2022, prices per square meter also decreased: comparing the first half of the year, where the values are highest, they were €1,249 and €1,152 in the city, and from €669 to €607 in the province.

While staying in Sicily, in Catania, a decrease in transactions of -6% is expected in the city and -1% in the province for the fourth quarter of 2023, with corresponding figures of 1014 and 2058 real estate exchanges. As in Palermo, prices have also dropped here: in the city, they fell from a peak of €1286 in the first half of 2016 to €1099 in 2022; in the province, from €800 to €704.

By autumn 2023, around 2,199 properties are expected to be sold in Genoa, a decrease of -6% compared to the same period last year. A more significant decline is anticipated in the province, with a projected -11% drop, leading to 1,214 transactions in the fourth quarter. In Genoa, there has also been a consistent decrease in the price per square meter over the past few years: from €2,047 in the city in the first half of 2016 to €1,681 in 2022; in the province, it dropped from €1,722 to €1,559.

The report was compiled based on an analysis of real estate transactions in Italy and in the 10 largest cities by population from 2011 to 2023. For this, databases owned by Reopla S.r.l were used, which include over 140,000 non-residential and more than 620,000 residential transactions over the last 24 months, as well as national databases provided by OMI, that is, the Institute of Real Estate Market Statistics, compiled by the Revenue Agency.