Genoa’s leadership: 7.5% returns that beat Milan and Rome
In the landscape of Italian real estate investments, Genoa emerges as the city with the highest returns for those buying a home to rent out, with a gross annual return reaching 7.5% for a two-bedroom apartment of 65 square meters. A figure that clearly surpasses the performance of more prestigious metropolises: Palermo follows with 7.1% and Verona with 6.6%, while Milan, often considered the most profitable market, offers returns between 4% and 5%.
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According to data from the research office of the Tecnocasa group relating to the first part of 2025, this Genoese leadership is part of a national context where the share of real estate sales for investment has dropped to 18% compared to 19.4% the previous year. The slight decline is attributed to competition from other forms of investment, but the real estate sector maintains its appeal, especially in markets like Genoa’s that offer interesting margins.
“In the Ligurian capital, the gross annual return for a two-bedroom apartment of 65 square meters reaches 7.5%. Followed by Palermo with 7.1% and Verona with 6.6%.”
— Tecnocasa, Research Office, first part of 2025
Real estate prices in Genoa: moderate but steady growth
The trend of prices in the Ligurian capital confirms a pattern of stable growth. In February 2026, residential properties for sale were requested on average at 1,760 euros per square meter, with an increase of 4.14% compared to February 2025 (1,690 euros/m²). Over the last 2 years, the average price within the municipality of Genoa reached its peak in February 2026, with a value of 1,760 euros per square meter.
This growth is part of a positive but not explosive national picture. Prices at the national level are expected to continue rising slightly in 2026 (between +1% and +3%), while for Genoa the range should oscillate between -2% and 0%, showing greater stability compared to other markets.
In the rental market, the data shows more lively dynamics: in February 2026, residential properties for rent were requested on average at 10.44 euros per month per square meter, with an increase of 7.74% compared to February 2025 (9.69 euros monthly per m²). This increase in rental rates directly contributes to improved returns for investors.
Strategic areas: where to invest in Genoa to maximize returns
The geography of Genoese prices shows strong differences between different areas of the city, offering diverse opportunities for investors. During February 2026, the requested price for properties for sale was highest in the Albaro-Sturla area, with 3,319 euros per square meter, while the lowest price was in the Ponente Entroterra area with an average of 883 euros per square meter.
Rive, Robert (1817-1868). Photographe Rive, Juliu…, Public domain, via Wikimedia Commons
For rentals, the distribution is equally varied: the requested price for rental properties was highest in the Centro area, with 14.43 euros per month per square meter, while the lowest price was in the Molassana-Struppa area with an average of 7.35 euros per month per square meter.
The historic center confirms itself as one of the most sought-after areas for short-term rentals. In January 2026, in the Centro area, residential properties for rent were requested on average at 15.03 euros per month per square meter, with an increase of 28.02% compared to January 2025. This exceptional growth reflects the strong tourist demand for accommodations in the heart of the city.
Carignano represents another strategic area. Carignano is a residential neighborhood located slightly outside the historic center. With spacious parks, quality restaurants and a lively neighborhood life, it’s an excellent option for short-term rentals for families or groups seeking a quieter and more relaxing environment. For those looking for a more tranquil stay, Carignano offers an exclusive residential environment with green spaces and a wide choice of quality restaurants and services. This area is perfect for families and groups of friends looking for a relaxing vacation without sacrificing proximity to the center.
The new 2026 tax rules: what changes for short-term rentals
2026 has brought significant changes to short-term rental regulations, with direct impacts on investment returns. One of the new 2026 rules for short-term rentals is the new threshold that the legislator has set for the transition from private activity to business activity. From the third property onwards, the flat-rate tax cannot be applied and a VAT number must be opened. Until December 31, 2025, the limit for operating as a private individual was set at 4 properties.
For those remaining in the private regime, taxation remains structured on two rates: with the flat-rate tax there are two rates to apply. For the first property it is 21%, while for the second it is 26%. The taxpayer has the right to choose which of the two can benefit from the more favorable rate: they can do this when submitting the tax return.
Those exceeding the threshold of two properties must face significant additional costs. Fixed minimum contributions for 2026 amount to approximately 4,611 euros annually up to an income of 18,808 euros. Those in the flat-rate regime can request a 35% reduction, bringing the minimum to approximately 3,000 euros.
“From the third apartment onwards you become a ‘business’ and the flat-rate tax is no longer permitted: the law presumes business activity.”
— Budget Law 2026, short-term rental regulations
Calculating returns: ROI and real costs
To correctly evaluate a real estate investment in Genoa, it is essential to apply rigorous calculation methodology. For the investment to be profitable – net of management costs – it is advisable to aim for a gross return of 7%-8%. Genoa, with its returns of 7.5%, is therefore perfectly positioned in this optimal range.
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The ROI calculation must consider all actual costs. Let’s take the example of a two-room apartment of 65 square meters in the city center:
- Purchase price: 1,760 euros/sqm × 65 sqm = 114,400 euros
- Estimated monthly rent: 10.44 euros/sqm × 65 sqm = 679 euros/month
- Gross annual revenue: 679 × 12 = 8,148 euros
- Gross yield: 8,148 / 114,400 = 7.1%
However, management costs must be subtracted from the gross yield: net rental income takes into account the annual expenses incurred by the owner, such as property tax, ordinary and extraordinary maintenance, insurance and taxes. It is a more realistic measure of profitability, because it reflects actual gains.
Typical costs include:
- Flat tax at 21% on revenue: 1,711 euros/year
- Property tax (estimated): 800-1,200 euros/year
- Condominium fees: 600-1,000 euros/year
- Ordinary maintenance: 400-600 euros/year
- Insurance: 200-300 euros/year
Net yield therefore stands at around 4.5-5%, which remains competitive compared to other forms of investment.
Short-term vs. long-term rentals: the comparison
The choice between short-term and traditional rentals depends on several factors. Tecnocasa explains that the slight decline in investments is due to competition from other forms of capital investment and a downsizing of the short-term rental phenomenon, which persists only in areas with strong tourist appeal. Those investing in real estate today focus mainly on long-term contracts in areas near universities or affected by urban renewal projects.
Short-term rentals maintain some distinctive advantages in tourist cities like Genoa: with the short-term rental formula, you can achieve significantly higher returns compared to traditional long-term rentals. Our team analyzes the local market to set competitive prices and maximize your apartment’s occupancy. We use dynamic pricing strategies to adapt rates to seasons, local events and market demand, thus guaranteeing the best possible profit.
However, today, looking at the table on the page, there is already a deterioration in gross profitability from short-term rentals (approximately 7% gross) compared to transitional rental rates (where average yield exceeds 11%). A phenomenon explained by higher management costs in short-term rentals, burdened by new obligations, possible property managers, utilities, waste tax and condominium fees charged to the owner.
Future prospects and advice for investors
The Genoa real estate market presents solid prospects for 2026. The 2025-2026 Price Index confirms a trend toward value stabilization, with a slight recovery in some central and prestigious residential areas. The city is undergoing a transformation phase that makes it increasingly attractive to tourists and residents.
To optimize investments, experts recommend: the strategy that maximizes returns in Italy today is: purchase at a discount, long-term rental and agreed flat tax at 10%. Evaluate cities with agreed rental rates: Bologna, Genoa, Verona, and Palermo offer the flat tax at 10% instead of 21%, generating savings of 15,000-30,000 euros over 10 years.
Timing appears favorable: taking advantage of the favorable timing: the credit market currently offers rates from 2.5% to 3.5%, but this won’t last forever. This scenario of moderate rates improves the feasibility of leveraged investments.
“Genoa with a 7% gross yield, then Palermo, then Verona. If you choose the agreed rental rate (where available), the flat tax drops from 21% to 10% and property tax is reduced by a further 25%.”
— Jesse.it, Real Estate Investment Analysis 2026
Final considerations for Genoa property owners
The data confirms that Genoa represents a concrete opportunity for owners evaluating the monetization of their properties. With yields of 7.5% that exceed those of Milan and Rome, purchase prices still accessible and a tax regime that, while tightened, maintains margins of convenience for small investors, the city positions itself as one of the most interesting markets in Italy.
The key to success lies in choosing the right location, understanding the new tax rules and adopting a professional management strategy. It is not enough to assess the marketability of the area and compare prices per square meter to understand if a property represents a good investment for rental income purposes. The calculation is complex and must also weigh taxes and management costs.
For Genoa property owners, the moment appears propitious to seriously evaluate investment in the rental sector, both short-term and long-term, taking advantage of a growing market and still favorable credit conditions.
Analysis based on public data and sources. genovabb.it is not a news organization. The data reported have been collected from sources believed to be reliable but their accuracy is not guaranteed.
