Aggregators put Italy's average gross rental yield near 6.6%, but Milan sits around 3.5-5% and Palermo or Bari above 6.5%. After the flat tax, IMU, building costs and vacancy, a net 3-4% is a realistic planning figure.
Rental yield in Italy averages about 6.6% gross in aggregator data, but that national figure hides a wide spread and says little about what an owner keeps. The expensive northern cities pay the least: Milan and Florence are estimated at roughly 3.5-5% gross, Rome 4-5.5%, while Turin, Naples, Bari and Palermo reach 6-8%. After the flat tax on rent, IMU, building costs and empty months, a net return of about 3-4% of the total outlay is a realistic planning figure for a foreign buyer. This guide shows where the gap comes from. Figures are as of October 2026 and indicative.
Gross yield by city: where Italy pays and where it does not
Gross yield is annual rent divided by the purchase price, before any cost. One table of estimated gross yields built on Agenzia delle Entrate (OMI) data gives these ranges:
- Palermo: 7.0-8.5%. Low prices per m², rents recovering.
- Bari: 6.5-8.0%. Student and business demand.
- Naples: 6.0-7.5%. Wide gap between the centre and the periphery.
- Turin: 5.5-7.0%. Supported by universities and the Polytechnic.
- Padua and Verona: about 5.0-6.5%. Mid-sized northern cities that outperform the big metros.
- Bologna: 4.5-6.0%. Strong student pressure, high purchase prices.
- Rome: 4.0-5.5%. High rents, but prices are high too.
- Florence and Milan: about 3.5-5.0%. Record prices and rents, and in Florence strong competition from tourist lets.
Sources differ: another aggregator summary gives narrower numbers (Milan 4.0-4.5%, Rome 5.0-5.5%, Turin 6.5-7.5%). Treat these as ranges for a typical flat, not a promise for a given street. The pattern is stable, though: the more expensive the city, the lower the gross yield.
North versus south
Listing data for the first half of 2026 (Immobiliare.it Insights, as reported by the press) shows national sale prices up 4.3% year on year at about 2,200 euro per m² and asking rents up 2.9% at 14.7 euro per m² a month. Prices rose fastest in the north-east (+6%) and north-west (+5.7%), and slowest in the south and islands (+1.2% to +1.8%). That is why gross yield is higher in the south: entry prices have grown more slowly than rents. The trade-off is liquidity and capital growth, which have been weaker there. For why this matters for risk, see our guide to investment risks in Italy.
Holiday regions: Puglia, Lake Como, Sicily, Sardinia
- Puglia (Salento, Ostuni, Monopoli, Valle d'Itria): agent and press reports talk of up to 8% gross in high season from short lets. That is a seasonal peak claim, not a yearly average.
- Lake Como: Como city averages about 2,740 euro per m² and the province is just under 2,000, according to Immobiliare.it figures. An Airbtics estimate for 2025 gives about 67% average occupancy with very strong July and August. It is a premium, seasonal market.
- Sicily and Sardinia: we did not find reliable 2026 yield data. Cagliari's used-home prices fell 1.1% over the year in idealista's second-quarter 2026 report, so do not assume a rising market.
Long-term or short-term rent: the tax difference
For a long-term lease an individual can choose the cedolare secca, a flat tax of 21% on rent, or 10% on a concordato (agreed-rent) contract in municipalities with housing shortages, which includes all metropolitan cities and provincial capitals. With the flat tax there is no registration tax or stamp duty on the contract. For short lets, the 2026 Budget Law keeps 21% on the first unit and applies 26% from the second; three or more units are presumed to be a business with VAT. The CIN code, safety equipment and city rules are in our short-term rental guide. We did not find a source confirming that a non-resident owner can opt for the flat tax, so ask an Italian accountant (commercialista) before you count on it.
What eats the yield
- IMU: the annual property tax on a second home. The base rate is 0.86%, and municipalities can go up to about 1.06% (exceptionally 1.14%), applied to a cadastral-based value. At the top rate it can pass 1,400 euro a year on a typical flat.
- TARI: waste tax, about 340 euro a year for a typical family in 2025, more in big cities.
- Condominium costs and maintenance: not all can be passed to the tenant.
- Vacancy: a month empty costs about 8% of annual rent.
- Management: agents and property managers charge a share of rent, usually higher for short lets.
Example: from gross 6.5% to net about 3.3%
Our own illustrative arithmetic, not market data. A 200,000 euro flat in a mid-sized city at 6.5% gross rents for 13,000 euro a year. One empty month leaves about 11,900. Take off roughly 1,000 for condominium and repairs, 900 for IMU and 150 for insurance, then 21% flat tax on the 11,900 rent received (about 2,500). That leaves roughly 7,400 a year. Against 200,000 plus about 25,000 of buying costs, the net yield is about 3.3%.
What to buy for which goal
- Cash flow: mid-sized and southern cities (Turin, Naples, Bari, Palermo, Padua), small flats near universities and transport, long-term lease on concordato terms.
- Capital preservation: Milan, Rome, Florence prime districts. Low yield, but deep demand.
- Lifestyle plus seasonal income: Puglia or the lakes, accepting vacancy and licence rules.
- Cheap restoration projects: see our guide to abandoned houses and 1-euro homes, which warns about the real renovation costs.
FAQ
What is a good rental yield in Italy? About 4-5% gross is normal in the big cities and 6-8% in cheaper southern and mid-sized cities, with 3-4% net as a prudent planning figure after tax and costs. Is Airbnb better than a long lease? Gross income can be higher, but the second unit is taxed at 26%, licence and city rules apply, and vacancy is seasonal. Where is yield highest? On OMI-based estimates, Palermo, Bari and Naples. Does the flat tax apply to foreign owners? Confirm with an Italian accountant. Where can I compare with Spain? See our Italy versus Spain comparison.
How we help
We shortlist by your goal (cash flow, capital preservation or lifestyle), model net numbers city by city and coordinate local lawyers and notaries. Browse the Italy page and read how costs and prices work in our guide on Italian property prices and buying costs.
Informational only, not legal, tax or investment advice. Figures are indicative as of October 2026 and change; yields are not guaranteed.