Kenneth Glad
Property values in Milan have risen about 38% in the past five years. That is a steep climb. The surge highlights a shift in where many wealthy individuals are choosing to base themselves, with parts of Europe gaining ground again.
According to The Guardian, average prices in Milan reached €5,171 per square metre by late 2025, making it Italy’s most expensive city.
Agents say the profile of buyers is changing. Foreign purchasers are no longer just occasional investors but are increasingly moving to the city full-time.
Diletta Giorgolo of Sotheby’s Realty said demand is now focused on residency rather than second homes, reflecting a deeper commitment from international buyers.
This growing demand is tightening supply in central districts and adding pressure to housing affordability for local residents.
Tax policy shift
Much of this movement is being driven by tax policy. Italy allows new foreign residents to pay a flat €300,000 annually on overseas income, a system aimed at attracting high-net-worth individuals.
The British newspaper reports that interest increased sharply after the UK ended its non-dom regime, reducing London’s appeal. Other European countries, including Portugal, have also tightened similar schemes, making Italy comparatively more attractive.
Marc Acheson of Utmost Wealth Solutions said the simplicity of the Italian system has been a key advantage, particularly given Milan’s established financial sector.
The policy has not escaped criticism. Former French prime minister François Bayrou accused Italy of “tax dumping”, a charge rejected by Italian officials.
Dubai still holds ground
Dubai continues to offer zero income tax and a well-developed luxury economy, keeping it firmly in contention for global wealth.
However, recent tensions in the Gulf, including Iranian attacks, have led some residents to reconsider their long-term plans.
Armand Arton, a relocation adviser, told The Guardian that clients are increasingly weighing European options, balancing financial incentives with lifestyle and proximity.
But tax is only part of the calculation. Dubai’s connectivity, business environment and established networks still appeal strongly to many.
For now, Milan’s rise points to a broader rebalancing, with wealthy individuals spreading their assets and residences across multiple global hubs rather than relying on a single destination.
Source: The Guardian
