Is it better to rent or buy property in Italy?

Is it better to rent or buy in Italy? Is now a good time to buy in Italy? These are all questions that you might be asking yourself if you plan to move to Italy in 2022. On the one hand, Italy is experiencing skyrocketing rents, on the other hand, house prices are remaining relatively low, but rising interest rates on mortgages across Europe will also stretch household budgets. So, is it better to rent or buy property in Italy in 2022? There is no single answer, and this decision depends on your personal and economic situation. Here is what to consider when choosing between buying or renting a house in Italy.

Buying property in Italy: advantages and disadvantages

The decision between buying a house or renting one in Italy can be more complex than it seems. Is buying property in Italy a good investment? As with everything, there are pros and cons of buying property in Italy. On the one hand, buying property gives you ownership of a house that you can resell in the future, earning a profit after inflation and devaluation of the property; but it is also true that in order to do so, you need an initial lump sum of money that is not always available.

Nowadays obtaining a 100% mortgage from a bank is not easy, as most lending institutions grant 80% mortgages at most, and even less if we're talking about mortgages for non-residents. In order to be able to buy a house with a mortgage, it is therefore necessary to have saved at least 20% of the amount needed for the purchase, plus a further 10% for the associated bureaucratic costs. Remember that buying property in Italy has its pitfalls and is something to  be carefully considered. 

Renting property in Italy: advantages and disadvantages

On the other hand, renting may seem like a waste of money in the long run, since you are paying an amount for something that will never be yours. However, this may be the optimal solution for those who do not wish to settle permanently in one place but value housing as a service, or need to move frequently for work, for example. In this way, having a rental-only house allows you to change accommodation more or less whenever you wish.

Is it better to buy or rent in Italy? It depends on your finances...

Choosing whether to buy or rent a property in Italy also depends on your finances. As mentioned, to buy a house, even with a mortgage, you need to have at least 30% of the required amount in cash. Some potential buyers, if they have a large amount of money in the bank, consider buying a house outright in cash. However, one option, even if you have the entire sum of money available, is to save it for other profitable investments and applying for a mortgage instead, taking advantage of the fact that interest rates, although rising, are still among the lowest in history.

It must also be said that in order to obtain a mortgage, one must have a stable income situation: banks in Italy demand proof of continuous income as a guarantee for the granting of the mortgage. Italian banks also recommend that no more than 35-40% of income should be devoted to paying financial debts, including monthly mortgage instalments.

Buying or renting depends on future plans

Another key point when choosing to rent or buy is your personal and professional plans. Are you planning to move? Does your job require you to change cities often? If the answer is yes, renting is the best option; buying a house, on the other hand, is a long-term commitment. A mortgage will tie you to a property, and even once purchased, a house you own is harder to give up for a new one.

Do your research: get to know the Italian market before buying or renting

In order to make the right choice between buying or renting a house in Italy, it is necessary to know the state of the Italian real estate market. If, for example, rent is higher than mortgage payments, buying may be the better option (and vice versa). It should also be kept in mind that the flats with the best price/quality ratio are the first ones to be snapped up, so a certain amount of timing is needed to identify and get the best property for your needs and finances, especially if you're moving from abroad.

When is it best to buy in Italy, and when is it better to rent?

Once the above questions have been clarified, it can be determined when it is better to buy or rent a house. Here is a summary of some of the main points to consider when making your decision to buy or rent property in Italy.

When it's better to buy property

• Owning a house offers a certain security. You pay for something that will be yours and that you can sell in times of need. In addition, you can rent out rooms in case you need extra income.
• If you have savings, a good work situation and a good mortgage profile, you should buy a house.
• If you find a house in an in-demand area at a suitable price and you can afford it, it's better to buy.

Find property for sale in Italy

When it's better to rent property

• When rent is lower than the mortgage payments, or when you are not eligible for a mortgage due to your financial situation.
• If you travel a lot and are away for long periods, renting allows you to be more comfortable and flexible.
• An intermediate option is rent-to-buy, which allows you to pay rent with the possibility of buying the house after a certain period, deducting the fees paid from the sum needed to buy it. Here you can check out our selection of the best rent-to-buy properties on offer in Italy.

Find long-term rentals in Italy