Europe's major property destinations. Part 1: Rome

The philosopher Kierkegaard once said "Comparison is the end of happiness and the beginning of discontent." Nevertheless, we do it and today we begin a small series of metropolitan comparisons. 

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Well, it surely depends a little on how well you perform. And that's why we chose to ignore the advice and compare Berlin as a metropolis and market with other cities in the EU. In the end, the question of what distinguishes Berlin from Rome can only be answered through differences. One way to measure that we are not alone in considering this point of view is that Berlin has not only recently been visited, populated and loved by a really large number of people from other metropolises. 

Each city has its own magic. Who doesn't fall in love with Paris right away, after just a few hours or minutes? Who is not fascinated by Rome's millennia of history, which can still be breathed in every corner? The Viennese way of life, the beauty of Lisbon, the energy of Madrid. Berliners miss out on all of this a bit, and yet people still love the German capital. Could the reason be that Berlin gains a little of everything from all the Parisians, the Viennese, the Madrilenos, the Romans and other new Berliners? 

Perhaps, however, above all it may be the opportunities that arise from the equal possibilities in Berlin. For thousands of young people, Berlin's knowledge landscape, hundreds of study programs and many thousands of jobs may ultimately be more important than the beauty of their own homeland. 

What were "soft" factors soon turn into very hard ones. Economic constraints, difficult labor markets, very high rents (yes, Berlin is cheap in comparison) and few opportunities at home often make it easy to choose Berlin as new home.

Europe struggles with problems in monetary policy

The war in Ukraine is driving up energy and food prices and inflation is rising to a new record high of currently around 8%. As a result, central banks are tightening their monetary policy. Not surprisingly, the ECB is reacting rather reluctantly, because the high national debt of some countries in the euro zone makes a differentiated view necessary. For Italy in particular, with a debt of 150% of its gross domestic product, an interest rate hike would mean a heavy burden. By comparison, Germany is only 69.3% indebted (as of 2021). Italy is not the only problem case in the EU. Portugal, Spain, Belgium and France are also above the EU average of 87.6% of government debt. In general, the guidelines of the Maastricht Treaty setting a mandatory debt limit of 60 percent are adhered by only 6 of the 17 euro countries.

Every private household knows that with a high level of debt, the amount of annual debt service also increases. In terms of public debt, Italy leads the ranking with 3.5% of GDP spent annually on interest payments. 

The fact that Germany only has to spend around 0.6% of its GDP on interest payments shows how skeptical our European neighbors are about German demands for higher interest rates to protect their savings.

Highly indebted countries are particularly affected by a rising interest rate. In particular, it is important to consider how long the countries' sovereign debt is structured. In the case of long-term debt, rising interest rates cause few if any problems, as no debt is taken on for the time being. By contrast, countries with short-term refinancing needs are directly affected by rising interest rates. These are also the countries with the biggest deficits and problems in the economy.

This short-term public debt accounts for a large share of Italy's 150 percent debt. Italy has to refinance 13% every year. Portugal is the front-runner in terms of refinancing requirements with around 16%. 

But Germany is also struggling with rising interest rates. For example, a one percent rise in interest rates would increase the current debt service of 4 billion to 13 billion, due to a high proportion of short-term liabilities. 

But how will this affect the Berlin real estate market and other major cities? 

Of course, to give an assessment of the local real estate market, we need to look at more than just interest rate policy. Important factors to be considered include population trends, developments in the housing and property market, the quality and size of the local education world, and the economic situation.

The eternal city

Rome is the capital of Italy and the largest city in the country. With a total area of 1,285 square kilometers, Rome is about 50% larger than Berlin. 

The population of Rome is estimated at just over 2.8 million, making the eternal city the third most populous metropolis in the European Union. 

The majority of the population is Italian, with about 9.5% of non-Italian origin. The majority of the immigrant population is European, including mainly Romanians, Ukrainians and Poles. They make up 4.8% of the city's population. The other 4.8% are of non-European origin, with Chinese, Filipinos, Peruvians and Bangladeshis forming the largest groups.

In the last six years, the population has increased: from about 2.6 million in 2012 to about 2.8 million in 2020. In 2021, the population has decreased slightly and is currently trending around 2.78 million. This is particularly due to Corona, which hit Rome and all of Italy particularly hard.

The eternal city is located roughly in the center of the Lazio region, near the estuary of the river Tiber, also known as the 'white river'. Rome, together with the Old Town and Vatican City, has also been a World Heritage Site since 1980.

The city can be divided into two areas. On the one hand there is the expensive inner city, which is located inside the Aurelian Wall. Outside the wall, the outer city and numerous suburbs are spreading. In total, four districts are distinguished, which in turn are divided into 15 neighborhoods.

The historical center consists of the area located almost entirely on the eastern bank of the river Tiber. As the name suggests, this is where most of the monuments and sights can be found. The Tiber is crossed by 22 bridges. 

The infrastructure of Rome reflects the long history of the city. As a result, many modern streets still reflect ancient constructions. Especially in the old city, this develops a complicated and unplanned layout. Problematic for this structure is the population density.The ancient streets were not built for millions of people, which is why chaotic traffic conditions are common, especially in the old city. The center of the city today is the Piazza Venezia, which is centrally located between the Vatican and the main train station. 

Especially compared to Berlin, the infrastructure is poorly developed. There are a total of three subway lines in Rome (A-C), although line C is still under construction and can therefore only be used to a limited extent or not at all. On the other hand, Rome has a very well-developed bus network that takes tourists to all sights, even outside the city.


The Rome real estate market offers many student accommodations and statistics show that Italy is the fifth most popular Erasmus destination. International students are one of the largest target groups in the rental market. 

Italy counts many prestigious universities that attract international students from all over the world. This is demonstrated by the increase in english degree programs. In the 2019/2020 academic year, an increase of around 6% or of around 800 courses was recorded. 

Historic Rome alone has around 45 universities, which together offer 620 courses. In addition to the largest `La Sapienza`, there are three other universities, along with a number of prestigious private colleges and Vatican pontifical and religious colleges. There are 130,000 students enrolled at the 'Sapienza' in Rome, with about 26,000 international students. Throughout Italy, about 1.8 million students are studying. With 330,000 new enrollments each year, this number has remained almost constant over the years.

In contrast to Germany, all universities in Italy charge tuition fees. Nationwide standardized and annually payable enrollment fees and a specific contribution charged individually by each educational institution make up the university fees. The enrollment fee can range from 750 EUR to 3,000 EUR. At private or specialized universities, this amount can also be higher. For example, medical studies can cost a solid 18,000 EUR per year.

Rom vs. Berlin

  Rom Berlin
Universities about 45 about 43
UniRank 108: Sapienza Università di Roma 12: Freie Universität Berlin
Population about 2,8 Million about 3,7 Million
Travel & Tourism Competitiveness Index 2019 5,1 Scorepoints 5,4 Scorepoints
Overnight stay 2019 about 36,6 Million about 34 Million


Rome is the political and cultural center of the country and also the hub of rail and air traffic. There are two airports, Leonardo da Vinci and Fiumicino. Rome is also one of the most frequently visited cities in the world, with countless cultural and historical attractions. 

This boosts Rome as a media hub with many publishing houses and film studios, as well as a fashion center of international importance. Rome also hosts many trade exhibitions with an international audience. Substantial funds flow into economic stimulus programs that revitalize various industries, which benefits the real estate market usually. 

Before the pandemic, Rome's economy had an average growth of 1.4%, though the central bank predicted a slowdown over the next few years. 

The National Economic Recovery Program is expected to provide significant funding to support the economy and has, among other things, led people to consider buying properties again.  

In addition, there has been a recovery in the main sectors of the Italian economy: tourism and the hospitality industry. This has led to a growing interest among private investors as well as funds and institutional investors worldwide. 

Like in Berlin, the average real estate price varies greatly by district and neighborhood. Especially in the historic center, the highest real estate prices in the entire city were to be found towards the end of 2021. Another common aspect here is that average prices in central locations are very attractive compared with other European capitals such as Paris and London. 

An average of 7,300 euros per square meter was paid for condominiums. This is twice as much compared with the average for condominiums in all other parts of the city. 

In the second half of 2021 the italian capital has seen sustainable demand in the real estate market. The popular properties in the central districts are preferably renovated three- and four-bedroom apartments. Prices range from around 5,000 euros to around 9,000 euros per square meter. International search for investments is growing especially in such historic districts, accounting for about 10 percent of transactions. Buyers from the United States, the United Kingdom and France are particularly active.

Available green spaces, larger indoor and outdoor spaces, and the ability to move easily without public transportation are predominant aspects for buyers. 

In the Trieste-Salario, Prati-Vatican and Parioli districts, all close to the Tiber River, prices per square meter for renovated apartments or new construction are currently rising to around €7,100, while apartments in need of renovation represent the lower end, with a price per square meter of around €4,200.

Berlin has chosen another path

Rome and Berlin, two cities alike in many ways. The eternal city shines especially through the long history and vast amounts of monuments, the Italian cuisine and the ever-warm weather. Even though the Roman economy is active in many industries, the focus is clearly on tourism and hospitality.

Berlin is becoming the leading innovation and high-tech location in Europe and the start-up scene is second to none in Europe. Since 2005, Berlin's economy has been growing faster than any other German state. Special factors are the strongly developed infrastructure, the high-quality universities and research institutions and a high availability of experts and skilled workers. A newly awakened start-up era has changed the economic structure, moving the focus away from industry and towards international innovation and services. In this context, if one looks at the venture capital invested in start-ups, Berlin is already the undisputed number 1, and where innovation has a place, established companies are also moving in. 

In addition, the tourism industry continues to grow steadily. Before the pandemic, up to 14 million people were drawn to Berlin every year. This is not without impact on Berlin's population. English has become the standard in some neighborhoods. Evening programs can easily be enjoyed in English and every university offers plenty of courses in the English language. Some degree programs are offered only in English. 

Overnight stays in Berlin that are due to work are free of the CityTax. On the one hand, this makes it more attractive for companies to accommodate international employees in Berlin.  At the same time, private overnight stays are an important source of revenue for the state of Berlin. 

Is living in Berlin cheap?

The cost of living in Berlin is low compared to other major European cities. For example, the cost of living in Berlin is almost 25% lower than in Paris. The same can be said of the Berlin real estate market. Local prices are low compared to Paris or Rome, despite the long and continuous period of growth. And despite the uncertainty in the market due to geopolitical crises, interest rate hikes and inflation, there is no end in sight to the demand for real estate in Berlin. 

Read soon in the metropolis comparison: Paris