Buy-to-rent in Italy – How to secure a 6% return and more
Italy: between longing and investment. A cappuccino in the piazza, cypress trees on the horizon, golden evenings on your own terrace – for many people, Italy is more than just a travel destination. It is a way of life. This is precisely where a growing real estate trend comes in: buy-to-rent. It is not just about owning a house or flat in the south but about using this property wisely as a capital investment.
Buy-to-rent combines emotional quality of life with economic sense. Anyone who purchases a property in Italy and rents it out, in whole or in part, can secure both a stable income and their own holiday home. The market is diverse, demand is high – and the potential returns are often well above the European average.
What does buy-to-rent mean
The buy-to-rent model focuses on letting. Owners purchase properties with the aim of renting them out profitably – either to tourists (short-term rentals), students, or professionals (long-term rentals), or in a hybrid model with occasional personal use. This creates a flexible investment with personal added value.
Short-term rentals – for example, via platforms such as Airbnb – offer higher returns but require active management and are often seasonal. Long-term rentals, on the other hand, are more predictable, require less maintenance, and are particularly attractive in university or working cities. Many investors combine both approaches, using the property themselves for a few weeks a year and generating rental income for the rest of the year.
Why Italy is particularly attractive
Italy is an exciting buy-to-rent location in many ways: it is not only one of the most popular holiday destinations in Europe, but also a diverse property market, with still affordable entry prices in many regions. Demand for holiday accommodation is high, as is the number of students and commuters in medium-sized cities.
What is particularly appealing is that investment costs vary greatly – while Milan and Florence offer little room for manoeuvre in terms of price, cities such as Lecce, Bari and Catania, and regions such as Marche, Abruzzo and Calabria, offer attractive purchase prices with solid rental demand. In addition, there are tax advantages for foreign buyers, especially for new developments or renovations.
Calculation examples: realistic returns through long-term and short-term rentals
A concrete example of long-term rental: a modernised, two-room flat in Bari costs around £100,000. If it is rented out for £650 per month, this results in a gross annual rent of £7,800. After deducting running costs (administration, maintenance, taxes), approximately £6,800 net remains. This corresponds to a return of around 5.7% – with little effort and predictable occupancy.
Those who opt for short-term rentals in a popular tourist region can expect higher revenues. Example: A charming holiday apartment in Ostuni (Apulia), two rooms, old town location, furnished, purchase price approx. €150,000.
It is rented out between April and October, via platforms such as Airbnb:
- Average daily price: £90–130
- Nights occupied per year: approx. 160
- Gross turnover: around £15,000
- Deductions (platform fees, cleaning, administration, taxes): approx. £5,000
- Net income: approx. £10,500
- Return: approx. 8.3%
A major advantage: in the off-season (e.g., November to March), the property can be used for personal use or rented out for longer periods. This increases both the personal and financial benefits.
Which locations offer potential
Choosing the right location is crucial. University cities such as Bologna, Padua, and Catania are ideal for long-term rentals. Tourist centres such as Ostuni, Monopoli and Lake Como are ideal for short-term rentals with high daily rates. Those thinking long-term will find affordable, entry-level opportunities with potential for appreciation in lesser-known regions such as Marche and Basilicata.
It is important that the infrastructure, target groups and rental price level are in line with the chosen rental model. Proximity to airports, rail connections and access to shopping facilities or tourist attractions are clear advantages. The legal situation also plays a role, as some cities (e.g. Florence or Venice) have restrictions on short-term rentals.
Assess risks realistically – and hedge them professionally
As with any investment, there are risks associated with the buy-to-rent model: seasonal vacancies, high administrative costs, or tax complexity. However, working with regional experts – such as estate agents, specialist solicitors, and management agencies – can significantly minimise these risks.
It also makes sense to have a clear strategy that covers possible scenarios: What happens if the property remains unlet for a long period of time? Who takes care of cleaning, maintenance and guest services? How are local property prices developing? Good preparation pays off in the long term.
Financing for buyers
Even if you do not live in Italy, financing through Italian banks is generally possible. As a rule, a down payment of 30 to 40 per cent is required. It is important to note that proof of income and other documents often must be provided in Italian.
