Italy real estate: Foreign buyers shift toward authentic locales

International real estate trends in Italy show a shift in buyer preferences. According to data from the real estate portal Gate-away.com, foreign purchasers are moving away from traditional tourist hubs toward more authentic, less crowded territories. In the first half of 2026, demand expanded to include villages, countryside, lake areas, and coastal locations distant from intense tourism circuits. Areas such as Lunigiana, Lake Trasimeno, Monferrato, Garfagnana, Maremma, Sabina, Langhe, and Tuscia have seen growing interest due to their tranquility, historical heritage, and quality of life.

Parallel to these shifting demographics, the Italian tourism and extra-hotel real estate sector faces complex fiscal challenges. Investors repurposing residential properties for short-term holiday rentals are navigating disputes regarding VAT deductions on purchases, renovations, and management expenses. This issue stems from the conflict between a property's cadastral classification (typically residential) and its actual economic use as a business activity. Legal clarity on these matters involves the principle of VAT neutrality as interpreted by the Court of Cassation and guidelines from the Italian Revenue Agency.