The global economic outlook is increasingly uncertain, with geopolitical tensions and trade policies reshaping growth expectations. According to Marketbeats #17 , the OECD forecasts a slowdown in global GDP growth to around 2.9% in 2025, down from 3.3% in 2024. This deceleration is largely driven by ongoing trade frictions and policy instability, particularly linked to the United States, which are disrupting global economic momentum.
Energy markets remain a key variable in this scenario. As highlighted on page 3, geopolitical tensions in the Middle East continue to influence oil prices, with fluctuations driven by supply constraints and strategic shifts in global trade flows. These dynamics contribute to broader economic uncertainty, affecting both inflation expectations and investment decisions.
Within this context, Italy faces structural challenges that directly impact the housing market. One of the most significant is the stagnation of real wages, which have declined in purchasing power over the past decade, limiting households’ ability to access homeownership. At the same time, consumer confidence remains fragile, reflecting concerns about economic stability and future income prospects.
However, despite these constraints, the Italian real estate sector continues to demonstrate resilience. The market benefits from strong underlying fundamentals, including the central role of real estate within household wealth. As noted on page 6, residential property represents a substantial share of national wealth, reinforcing its position as a key investment asset.
Supply dynamics remain a critical issue. Historical data (page 9) show a structural decline in new housing production compared to peak levels observed in the mid-2000s. In 2024, new residential construction remains significantly below past levels, contributing to a persistent imbalance between supply and demand, particularly in high-demand urban areas.
Transaction volumes, however, are showing encouraging signs. As illustrated on page 10, total residential transactions increased in early 2025 compared to the same period of the previous year, driven primarily by existing housing. New-build transactions, while still limited in volume, continue to play a strategic role in the market.
Major cities remain central to these dynamics. Milan and Rome continue to lead in terms of transaction volumes and demand intensity, although the share of new housing transactions in large cities remains relatively limited. As highlighted on page 11, only a small portion of new housing transactions is concentrated in the main urban centers, with a significant share occurring in secondary markets.
At the same time, investment activity is showing signs of recovery. After a volatile period, real estate investments are gradually increasing, supported by renewed interest in key asset classes and improving market conditions. This trend is reinforced by the long-term attractiveness of Italian real estate, particularly in major metropolitan areas.
In conclusion, Italy’s housing market is navigating a phase of rebalancing between global pressures and domestic structural factors. While economic uncertainty and affordability constraints continue to weigh on demand, limited supply and strong underlying fundamentals are supporting market stability. The evolution of these dynamics—particularly the interplay between supply shortages, investment flows and household purchasing capacity—will be crucial in shaping the next phase of the residential market.