Italy real estate yields stay high as housing costs surge

Idealista’s analysis of the first quarter of 2026 shows that gross rental yields on residential property in Italy average 9.5%, rebounding from a 9.1% dip at the end of 2025. The most profitable cities for residential rentals are Ragusa (10.7%), Trapani (10.6%) and Rovigo (9.8%). In the largest urban markets, high sales prices compress yields, with Milan at 5.4% and Florence at 5.8%. Commercial spaces remain the top‑performing asset class, delivering an average 12.4% yield, while office properties generate about 10.1%.

At the same time, Sicily is facing a housing‑affordability crisis. In Trapani, rent consumes 30.5% of household income, with similar pressure in Siracusa (32.7%), Palermo (31.8%) and Catania (30.7%). The ANCE Sicily association urges a comprehensive regional housing plan that includes public construction, renovation of existing stock, social housing and incentives for landlords offering lower rents. Regional authorities have allocated €259 million of EU funds and €15 million from the stability law, but officials say the resources are still insufficient to guarantee affordable housing for middle‑income families.