The Housing Market in Italy Compared with the Netherlands

Italy does not have a shortage of bricks. It has the wrong homes in the wrong places.

After Spain, Italy is the second country in TEN's European housing-market series. Not because the Italians have organised their housing market better than the Dutch. On the contrary: Italy is marked by slow procedures, limited new construction, large regional differences and a rental market that barely connects to the modern labour market. But Italy shows something the Netherlands rarely talks about: a country can have a housing problem without an absolute shortage of buildings.

The figures first. As of 1 January 2026, Italy counts around 58,9 million inhabitants and approximately 26,6 million households. The Netherlands counts over 18 million inhabitants and a housing shortage of around 396.000 homes. The problems appear different. Yet both countries run into the same question: are the right homes in the right place for the right stage of life?

The Netherlands Builds, Italy Barely Moves

The Netherlands added around 70.400 homes to its stock in 2025 and issued permits for almost 86.000 new homes. Even so, the annual addition declined for the third year in a row and production remains below the political ambition of 100.000 homes per year.

Italy builds considerably less. In the first quarter of 2025, the number of permitted new homes fell by 19,4% year on year; the second quarter followed with a further decline of 7,3%. Only later in 2025 did some recovery emerge. According to market analyses, only around 10% of Italian housing transactions in 2025 concerned new construction. The Italian market therefore runs almost entirely on existing homes. That is a weakness and an opportunity at the same time.

Six Years' Difference

The most interesting figure has nothing to do with construction output. Dutch young people left the parental home in 2024 at an average age of 23,8. In Italy, the average was 30,1. More than six years' difference.

That is partly culture, but it is also housing market. When affordable rental homes, student housing and products for young professionals are lacking, the first step in the housing career takes longer. The Netherlands demonstrably makes independence more attainable. Italy shows what happens when the market offers too few products between the parental home and home ownership.

The Netherlands then has a problem of its own. It lets young people live independently earlier, but offers less and less flexibility afterwards: a student, starter, young professional, expat and divorced parent regularly compete for the same small rental home.

In Italy, by contrast, an institutional Living market is emerging that responds to exactly this. In the first half of 2025, around € 670 million was invested in the Italian Living sector, more than double the amount in the same period a year earlier. Student housing, multifamily, co-living and senior living are becoming distinct real-estate categories. Italy still trails Northern Europe here, but the direction is clear.

Prices: Europe's Exception

Between 2010 and 2024, house prices in the European Union rose by an average of 53%. Italy was, together with Cyprus, the only EU country where prices did not rise over that entire period. In 2025 that picture began to shift: Italian house prices rose by around 4,0% on average, with existing homes up 4,7% and new construction considerably less.

That contrasts sharply with the Netherlands, where the shortage translated directly into rising prices for years. Italy therefore does not have one national housing crisis, but several local housing markets. Milan, Rome, Bologna and Florence face scarcity and high rents, while elsewhere homes and entire villages are emptying out.

The Italian Lesson

The Netherlands responds to virtually every housing-market problem with the same answer: build more. Italy forces a different question: what can be done with the buildings that already exist?

Transformation of offices, hotels, monasteries, schools and hospitals can become part of the solution. In student housing this is already happening: the Italian government does not finance new construction exclusively, but also makes existing real estate suitable for students. For a densely built country such as the Netherlands, that is directly relevant.

Who Does It Better?

The Netherlands wins on housing production, social housing, the independence of young people and institutional organisation. Italy is stronger in the reuse of existing stock, urban transformation and the rapid institutionalisation of new Living concepts.

Both countries, however, make the same mistake: they talk about homes and too little about housing careers. The Netherlands wants to build 100.000 homes per year. The question is therefore not how many homes are built, but which 100.000 moves those homes should set in motion. A well-functioning housing market is not defined by how many bricks are laid, but by how many people can take the next step because of them.

This is the first article in the TEN series Italy versus the Netherlands. The series consists of four parts: the housing market in general, student housing, senior housing and co-living.