Milan luxury real estate booms as bankers leave London for Italy

Milan’s luxury real estate market boomed as bankers, fund managers and private investors flocked to the city to invest in the real estate sector.

Tax “generous”!

One big draw with high net worth individuals considering moving to Italy are the tax breaks.

Accordingly, Milan gives newcomers the choice of paying a fixed income tax of 100,000 euros a year ($108,570), or not paying tax on up to 70% of their income for at least five years.

According to the Ministry of Finance, in 2022 Italy counts about 16,000 Italian citizens and foreigners taking advantage of these incentives and more than 400 people benefiting from the flat tax, helping to move Milan’s real estate market towards the segment. high-class.

Especially since the city has become a popular stop for financial workers leaving London after Brexit.

Milan changed itself before calling

In the run-up to Milan’s 2015 World Expo, city leaders and real estate companies transformed the rundown Porta Nuova and old Milan fairgrounds into beautiful modern landmarks.

The above investment enabled luxury residential, commercial and business areas to develop accordingly. And the dynamism has positioned Milan as a rare bright spot in the global real estate sector today.

Italy is well-positioned to avoid much of the turmoil caused by the slow recovery of the property sector in the aftermath of the 2009 global financial crisis.

“After the crisis, the European real estate market was active, while Italy only walked slowly. But it is a steady step” – Mr. Mario Breglia, real estate research company Scenari Immobiliari, for know.

Accordingly, the attraction is partly due to geography. Milan is an hour’s flight from the financial center of Frankfurt (Germany) and less than two hours from London (England). It’s also just a two-hour drive from the Mediterranean coast and to the Alpine ski resorts in about an hour and a half.

Giovanni Raffa, employee of Credit Suisse Group AG, who moved to Milan at the end of 2021 after 16 years in London, said: “Milan is the financial center of Italy and it’s a great place to redefine. reside”.

High-end real estate prices skyrocketed

Property prices are starting to reflect the new appeal of the city of Milan. The value of luxury properties increased 25% to 5.8 billion euros in the past six months, according to real estate website immobiliare.it.

That’s a significant increase, given that the average luxury property price in Italy only increased by about 2% between 2019-2021.

“After Brexit, we have seen a significant return of Italians, along with an increasing number of wealthy foreign buyers,” said Andrea Pincherli Vicini, managing director of the real estate brokerage. senior Vincenzo Monti Prestige based in Milan, said.

CityLife, a luxury complex on the northeastern outskirts of the city that is home to flashy buildings by world-class architects such as Daniel Libeskind, Zaha Hadid and Arata Isozaki, is a hotspot. Highlights of the new Milan.

Paolo Micucci, managing director of Generali’s CityLife division, said prices in the neighborhood could be as high as 15,000 euros per square meter.². However, that did not dampen investor interest.

In the final batch, 103 homes were sold out before construction was completed.

“Good land birds perch”

After Brexit, some of the world’s biggest banks came under pressure to move traders out of the UK and into mainland Europe.

Italian banks such as UniCredit SpA and Mediobanca SpA were the first to “repatriate” to Milan. And their international partners are following suit. Goldman Sachs is moving traders from London to Milan.

Over the past few years, investment firms Certares, Eisler Capital UK and Andera Partners have also opened stores in the city.

According to a new report from the European Bank, the number of high earners in Italy – individuals earning more than 1 million euros a year – has increased to 351, an increase of 88% from the previous year.

These changes could help Milan secure its fledgling position as a global financial hub.