Quick answer: These two cities attract the same international money for opposite reasons. Milan is where people move; Florence is where they buy. The question that decides between them is whether Italian tax residence is part of the plan, because the residence decision drags the property decision behind it.
International buyers arriving in Italy divide into two groups that rarely recognise each other. One is moving their life and needs a functioning city. The other is acquiring a beautiful building they will use for part of the year. Both look at the same country and should look at different cities.
Residence first, property second
If Italian tax residence is part of the plan, the residence decision comes first and Milan wins it. The regime moves a household, and a household needs schools, flights, healthcare, advisers and, frequently, work for someone in it.
If tax residence is not part of the plan, Milan’s advantages are irrelevant and Florence competes on what it actually offers: an unmatched stock of historic property in a city of a size that can be enjoyed.
The condition that reverses it: a buyer who wants residence but not a city. Italy’s regimes do not require living in Milan, and a household prepared to organise its own logistics can take residence in Tuscany and accept longer journeys. That works, and it should be a choice rather than an oversight.
What the regime actually is
Article 24-bis of the Italian income tax code offers a flat substitute tax on income of foreign source, in place of ordinary Italian taxation of that income.
| Element | Position |
|---|---|
| Annual amount | €200,000 for those transferring residence after 10 August 2024 |
| Previous amount | €100,000, for earlier arrivals |
| Family members | €25,000 each, unchanged by the increase |
| Prior residence test | Not Italian tax resident in at least 9 of the 10 preceding tax periods |
| Maximum duration | 15 years |
| Eligible family | Relatives identified under article 433 of the Civil Code |
The doubling of the headline amount in 2024 changed the arithmetic without changing the logic. The regime still works for a household whose foreign income is large enough that a flat charge beats ordinary rates, and the threshold at which that happens simply moved upward.
The flat tax and investor visa comparison sets out the tax regime against the immigration route, which are separate questions frequently conflated, and the elective residence comparison covers the visa side for those without an investment.
Why the regime points at Milan
Not for any property reason. A relocating household has a list of requirements and the property is near the bottom of it.
- International schools with capacity and continuity, which is the item that most often decides where a family with children actually lands
- Direct flights to the places the household still has business, which for a European or transatlantic profile means a major hub
- Professional advisers who handle this regime routinely, in the same city as the client
- Private healthcare at a standard the household is used to
- A labour market for a spouse or adult children who are not retiring
- A resident international community, which matters more to the people living it than it does on paper
Milan supplies all of those at a scale that no other Italian city matches. Rome supplies most. Florence supplies some, at a smaller scale, and a family that has moved for tax reasons and finds itself driving to another city for school runs has made an expensive mistake in the cheapest part of the decision.
What Florence offers instead
A different product, and a genuinely excellent one.
The city has a stock of historic property that has no equivalent, an international presence going back centuries rather than decades, a size that makes it walkable and comprehensible, and a cultural life out of all proportion to its population. For a buyer acquiring a house to use rather than a base to live in, none of Milan’s advantages compensate for any of that.
What has changed is the investment case attached to it. Florence has capped short-let activity in its historic core to units already operating during 2024 and stopped issuing new authorisations in the UNESCO area, and the block has since been extended further. The Florence page sets out the position in detail. A buyer whose Florence thesis was tourist income is buying into a market the city has closed, and should either find a unit with an established position or rebuild the thesis on residential letting.
Running the comparison as an investment
Set the lifestyle aside and the numbers say something fairly clear.
Liquidity. Milan has the deepest resale market in Italy. Florence’s is deep for prime historic stock and thinner elsewhere, and its buyer pool is more international and therefore more sentiment-driven.
Income. Milan’s rental demand is professional, year-round and reliable, and the Milan guide sets out the districts and their pricing. Florence’s residential letting is real and its tourist letting is now restricted; the Florence guide covers the wider market.
Price. Milan is the most expensive market in the country and Florence’s prime historic stock is not far behind it per square metre.
Yield. Thin in both, for the same reason: buyers are paying for something other than income.
Run either through the rental yield guide honestly and the answer in both cities is the same: a buyer expecting a high yield has misunderstood what they are buying.
The both-cities structure
A significant number of households that take the new-resident regime end up holding two positions: a functional apartment in Milan where residence and daily life sit, and a house in Tuscany or elsewhere used for part of the year.
That structure works and it is worth naming its costs. It requires capital for two purchases rather than one. It produces two different management problems: a let flat with a tenant, and a house standing empty for much of the year with the maintenance and security questions that implies. And it doubles the professional relationships, since the two properties sit in different comuni with different rules.
For buyers considering it, the sequence matters: settle the residence, then buy the base, then buy the house. Doing it in the other order tends to produce a beautiful property in the wrong place and a compromise on everything else.
Where else the same question lands
Bologna is the underrated third option for a household that wants a functioning city with international connections at a price below both, and the Bologna and Florence comparison sets out how differently the two Tuscan and Emilian markets are supplied. Within Milan, Navigli is the district most foreign buyers look at first and is not necessarily the one that suits a resident household best.
The summary is short. Milan is a place to live that happens to have property. Florence is property that happens to be in a place to live. Buyers who know which of those they are buying rarely regret either.
What a relocating household should check first
Before any property is viewed, five items decide whether a city works, and none of them is on a property portal.
School capacity, in the specific year the children would enter, at the specific institutions the household would accept. Places are not uniformly available and a waiting list changes the answer.
Flight connections to the places the household still has obligations, including frequency and whether they persist through the winter.
An adviser who has run this regime before, in the city, and can say how many times.
Healthcare arrangements, both the public position and whatever private cover the household expects.
Whether a partner or adult child needs work, and whether the local market has it.
A household that has answered those five knows which city it is moving to. The property search then becomes ordinary, and is much shorter than it would otherwise be.
The exit from each city
Worth thinking about at purchase, because the regimes that bring people to Italy are time-limited and the property outlasts them.
A Milan flat sells into the deepest resale market in the country, with domestic buyers, institutional buyers and international ones all active. It is the most liquid residential asset a foreign owner can hold in Italy.
A Florence house sells into a narrower and more international pool, where the number of active buyers for a specific type of property at a given moment is small. That produces a wider range of outcomes on both price and time.
Neither is a reason to choose, and both are a reason to be honest about the holding period. A buyer who might need to sell within a defined window should weight Milan; one who can wait for the right buyer loses nothing in Florence.
What each city costs to run
The recurring costs differ in ways that a purchase comparison hides.
A Milan apartment in a modern building carries condominium charges that reflect a lift, a concierge in some buildings, heating and grounds. Those are real and they are the price of a building that works.
A Florence apartment in a historic building carries heritage-supervised maintenance, facade programmes that take longer and cost more than an ordinary refurbishment, and in many buildings no lift at all. The charges may look lower and the extraordinary works arrive larger.
For an owner who will not live in the property full time, the second profile is the harder one to manage remotely, because the decisions are bigger and less frequent and turn up in an assembly the owner cannot attend.
Advice worth paying for in each
In Milan, a good agent and a mortgage broker if finance is involved. The market moves fast, stock is competitive, and the value of local representation is in access and speed rather than in investigation.
In Florence, a surveyor and a lawyer before an agent. The buildings are old, the register frequently does not match what has been built, and the short-let position of a specific unit is now a material and verifiable attribute that has to be established rather than assumed.
That difference in where the professional money goes is a fair summary of the difference between the two markets.
A last distinction worth holding
Milan is bought for what it does. Florence is bought for what it is.
That sounds like a slogan and it has a practical use: it tells a buyer which questions to ask. About Milan, ask about employment, transport, schools, supply and rents, because those determine whether the city does its job. About Florence, ask about the building, the fabric, the register, the heritage position and the regulatory status, because those determine whether the thing you are buying is what it appears to be.
A buyer who asks Milanese questions about a Florentine palazzo learns very little, and the reverse is equally true.
What the regime does not do
Three things worth stating, because the new-resident regime is frequently oversold.
It does not confer the right to live in Italy. Immigration status is a separate question with its own routes and requirements, and a tax election is not a visa.
It does not cover Italian-source income. Income arising in Italy, including rent from an Italian property, is taxed in the ordinary way, so a buyer letting an Italian flat is outside the regime for that income.
It does not last forever. The maximum is 15 years and the property will outlast it, which is why the exit and the resale market matter as much as the tax arithmetic at the point of arrival.
A household that has understood those three is making the decision on the right basis. One that has been sold the headline number alone is not.
Frequently Asked Questions
Establish whether Italian tax residence is part of the plan. If it is, the property follows the residence and Milan supplies everything a relocating household needs: schools, flights, a labour market and advisers. If it is not, the residence advantages are worthless and Florence competes on its own terms as a place to own a house.
An optional regime under article 24-bis of the Italian income tax code, charging a flat annual amount on foreign-source income instead of ordinary taxation. It was raised from €100,000 to €200,000 for people transferring residence to Italy after 10 August 2024, with €25,000 for each family member joining.
Someone who has not been resident in Italy for tax purposes in at least nine of the ten tax periods preceding the option. The regime runs for a maximum of fifteen years and family members identified under the Civil Code can be brought in on the same terms if they meet the same conditions.
Because the regime moves a household, not a portfolio. A family relocating needs international schools, direct flights, a professional services base, private healthcare and a labour market for the partner who is not retired. Milan has all of those at a scale Florence does not, and none of them is about property.
It attracts them as buyers of houses rather than as residents. Florence has an outstanding stock of historic property and a long international presence, and much of what foreign money buys there is used for part of the year. That is a different transaction from a relocation and it should be modelled differently.
Its short-let position. The city has capped tourist letting in the historic core to units already operating during 2024 and stopped issuing new authorisations in the UNESCO area, with the block subsequently extended further. A buyer whose Florence thesis was tourist income is buying into a closed market.
Milan, on liquidity and on the reliability of the rental income, at a price that leaves the yield thin. Florence has scarcity and international recognition on its side and a regulatory environment that has been tightening. Neither is a bargain and both are bought partly for reasons that are not financial.
It is a common structure and it works: residence and a working flat in Milan, a house in Tuscany used for part of the year. It requires enough capital for two positions and it produces two very different management problems, one of which is a tenant and the other of which is a building nobody is in for eight months.
Get an Italy property shortlist
Tell us your budget and region (Tuscany, Lake Como, Puglia, Milan, Sardinia). We reply within one business day with options matched to your goals.