Real Estate 2026: Decelerating Price Growth and Softened Sales in Q2

Information extracted from the Bank of Italy's Housing Market Survey indicates a phase of cooling in the industry, yet without progressing into a severe downturn. Realtors are cautiously growing more optimistic about the future outlook.

The Bank of Italy's survey for the second quarter of 2026 revealed a slowdown in the pace of increase in residential property prices. Transactions mediated by agencies also exhibited a minor decline compared to the same period last year.

Specifically, agents observe modest price movements, while negotiation discounts and average sale durations persist at historically low levels. Buyer interest remains feeble, coupled with a further decrease in the housing inventory available on the market.

Housing Price Trends are Slowing Down

In the second quarter of 2026, the difference (balance) between the proportion of realtors reporting price hikes and those noting a decrease decreased to 7 percentage points (versus 12 percentage points in the previous quarter). Despite the deceleration, this figure remains higher than in the same period of 2025.

Regional Analysis:

• Northwest: witnessed the most significant drop in growth rates - the balance decreased from 11 to just 1 p.p.
• Northeast and Center: experienced a more moderate slowdown (balances 13 and 11 p.p., respectively).
• South and Islands: recorded a balance of 6 p.p.
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Discounts and Sales Terms Maintain Low Levels

The average discount during negotiations from the initial price stood at 7%, slightly below the previous quarter and close to the historical minimum.

Regional Breakdown of Discounts:

• North-East: with an average discount of only 5%;
• North-West and Center: reported average figures;
• South and Islands: showed an average discount of 9%.

Housing sales continue to be swift - averaging 5 months. This indicates that properties listed for sale are finding buyers relatively quickly.

Approximately 86% of real estate agencies completed at least one transaction per quarter (a stable indicator). The majority of transactions occurred in the secondary market, representing 81% of all sales.

Slight Decline in Sales Volumes

Transactions conducted through agencies displayed less favorable dynamics. The balance of responses regarding sales volume stood at -13 p.p. (though better than -19 p.p. at the start of the year).

Compared to the second quarter of 2025, the indicator deteriorated (from -17 to -20 p.p.). The most significant drop in activity was noted in the Northwest and Northeast regions, while the Center, South, and Islands experienced a milder decline.

Supply and Demand Continues to Decrease

• Demand: Assessments by realtors on the fluctuation in the number of potential buyers dropped by -15 p.p.. This remained stable compared to the previous quarter and improved from the 2nd quarter of 2025 (-19 p.p.). Demand remains weak but displays slight signs of annual recovery.
• Supply: The volume of new sales orders continues to dwindle - the majority of agents reported a decrease in supply by 26 p.p.. The balance of unsold inventory also remains negative (-26 p.p.).

Consequently, the market is witnessing a simultaneous decline in demand and supply.

Mortgages and Credit Accessibility

Mortgage lending conditions remain relatively favorable and generally do not disrupt transactions:

• 63% of property acquisitions in the second quarter of 2026 were financed through mortgages (a slight decrease from 65% in the previous quarter).
• The average loan-to-value ratio (LTV) stood at 78%, maintaining a high level.
• Only 18% of agencies identified mortgage acquisition difficulties as a reason for canceled sales, marking one of the lowest figures on record.

Increasing Rents and Shrinking Availability

The rental sector demonstrates a positive trend for landlords:

• 83% of agencies finalized at least one leasing agreement per quarter (compared to 79% previously).
• The growth estimate for rents showed a balance of +32 p.p.

Regional Overview:

• In the Center (+41 p.p.) and in the South/Islands (+49 p.p.), rental rate growth significantly accelerated.
• In the Northwest, there was a notable slowdown: the balance dropped from 30 to 17 p.p.

Realtors anticipate a new phase of rent price increases in the upcoming quarter (the expectations balance rose to +23 p.p.). Concurrently, the availability of rental properties is diminishing (balance at -26 p.p.).

An influential factor is the impact of short-term (daily) rentals. 54% of agencies view this as significant in their local market. In the Center, as well as in the South and Islands, this figure reaches 65%, diverting properties from the long-term rental segment.

Forecasts for the Real Estate Market 2026-2028

Projections from operators remain cautious yet exhibit positive changes:

• Short-term expectations of agencies for their respective markets stood at -14 p.p. (an improvement from -18 p.p. the previous year).
• National market expectations:
• For the current quarter: -15 p.p. (an enhancement from -17 p.p.);
• For the next 2 years: -10 p.p. (a significant increase compared to -22 p.p. last year).

This indicates a cautious yet growing confidence among market participants regarding the future of the Italian real estate sector over the next two years.