Italy - Country Commercial Guide
Design and Construction

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2022-11-26


Italy, which has the 11th largest global construction market outside the United States, is of strong interest to U.S. exporters. U.S. building products enjoy a reputation for quality and reliability in Italy, although not always up to Italian standards for aesthetic design, which is considered important even for the materials and components that end-users do not usually see. The Italian design and construction industry considers itself to be a world leader, in the same league as the United States, and is therefore interested in looking at unique or cutting-edge products and solutions.

According to estimates from the National Association of Building Contractors (ANCE), investments in construction rose 16.4% in 2021 compared to the previous year, to around €147.9 billion. ANCE forecasts that the Italian construction industry will grow only 0.5% in 2022. The industry will remain at 2021’s robust levels because the market is still fueled by post-pandemic public works, and public incentives to make buildings more sustainable and more digital. In addition, there is increased demand for larger homes caused by the perception that teleworking and virtual schooling – widely implemented during the pandemic – will become a fixture of life for the next few years. However, the lack of additional incentives and uncertainties about the long-term economy will prevent the construction market from growing faster.

In 2021, investment in construction of new housing rose 12% compared to 2020, nonresidential building increased 11.6%, and public works and civil engineering rose 15%. Projects in housing renovation, the only sub-sector to grow regularly throughout the post-2009 financial crisis period, increased 25% in 2021. This high growth rate was stimulated in large part by extraordinary incentives, including a 90% incentive for roof and building façade renovations and a 110% incentive for energy saving renovations, which continue for most of 2022. The possibility of ceding these tax credits directly to financial institutions meant property owners could initiate projects with only a fraction of the usual capital spending. After the COVID-19 pandemic contributed to a 7.7% fall in the number of housing transactions in 2020, home transactions grew much faster than expected in 2021, growing 43.1%. Bucking trends from previous years, housing purchases grew faster in smaller cities and towns in 2021 (up 46.6%) than the largest metropolitan cities (up 36.1%). Home mortgages also rose 30.4% in 2021. The faster growth in the smaller cities and the suburbs, according to ANCE, is in part because the pandemic stimulated the search for more living space and better access to gardens. Italian families can better afford these larger homes when they are outside the major metropolitan areas.

ANCE’s outlook for 2022 predicts that rapid growth in overall construction investment will plateau at a level slightly above the previous year’s robust market. The redevelopment of the existing stock for housing purposes will contract on the previous year’s record levels (down 8.5%), but this will be made up for by continued growth in new housing construction (up 4.5%), private investments for non-residential buildings (up 5%), and public works (up 8.5%). ANCE still expects that most new housing and non-residential investments will be concentrated in a few cities in the north of Italy (Milan, Turin, and Bologna).

In 2021, public works rose by 15%, building on the already robust growth (9.5%) the prior year. This was fueled in part by an 15.1% increase in public works spending by Italy’s local governments and in part because these public entities accelerated already-planned infrastructure spending so that they could shift attention to the EU-financed post-pandemic recovery spending program, the National Resilience and Recovery Plan (NRRP or PNRR - Piano Nazionale di Ripresa e Resilienza). One example is RFI, the government-controlled company that builds and maintains Italy’s rail network, which committed €300 million more to major rail projects in 2021 than it had originally planned.

ANCE forecasts that investments in public works will rise by 8.5% in 2022. This is mostly due to an estimated €4.3 billion in additional public works and construction coming from the NRRP in 2022. The NRRP overall foresees €108 billion in construction and related spending by 2026. Of these, 45% will be managed by local governments. In addition, the 2022 budget law foresees €39.6 billion in additional overall public works spending in the next 15 years to reinforce NRRP projects in the long term and to respond to infrastructure needs not covered by the NNRP. Of this, €10.8 billion will be for rail infrastructure and €10 billion for roads. In addition, the Government also committed €6 billion to continue the reconstruction of parts of central Italy hit by catastrophic earthquakes since 2009.

According to ISTAT, Italy’s statistics agency, Italy had 487,000 companies in construction and related industries in 2019, the last year for which data is available. Specialized construction services and products accounted for 75.8% of the total, followed by building construction (22.8%), and civil engineering construction (1.4%). According to Eurostat, the EU’s statistics agency, Italy also has one of Europe’s highest home ownership rates as over 75% of families owned their own homes in 2020, accounting for over 20 million units. 

Italy is home to manufacturers of high-quality products and has access to European and global suppliers of competitively priced building products. U.S. suppliers must overcome shipping and regulatory costs and deliver on product performance and post-sales service requirements to compete on quality, reliability, and innovation, or they must provide a unique selling proposition. Regular direct engagement with distributors and buyers is often necessary to create and maintain sales and to distinguish specific product performance versus competitors.

Leading Sub-Sector


Italy is one of Europe’s three largest heating, ventilation, and air conditioning (HVAC) markets. According to Assoclima, Italy’s HVAC industry association, in 2021 the HVAC market grew 37% over 2020, reaching a total value of €2.3 billion in 2021, over half of which represents imports. National production in Italy rose 11% from €712 million in 2020 to €825 million in 2021. Increased interest in air quality during the pandemic and government subsidies for more energy-efficient systems stimulated a sturdy 17% increase in the number of air cooling and treatment systems sold in 2021.

The pandemic accelerated already rising demand for residential HVAC systems, as more people began to work and study from home. This post-pandemic situation may increase the demand for more energy-efficient systems as well as IoT-enabled heating and cooling systems to offer real-time monitoring of system functionality and conditions. Government tax breaks and subsidies to encourage the use of more energy-efficient residential heating and cooling systems will continue to stimulate demand through 2022. Anecdotal evidence from companies contacted by CS Italy, however, appears to indicate that the interest in air purification systems, even innovative technologies, has plateaued in 2022 as pandemic-related concerns are no longer driving the market as much as in 2020 and 2021.


Incentives for home improvements that increase energy efficiency  

U.S. suppliers of products, services, and technologies that increase the energy efficiency of buildings, including heating systems, air conditioning, insulation, solar panels, and charging stations for electric cars, may benefit from Italy’s incentive program for homeowners. Known in Italy as the “110 Incentive,” the program reimburses homeowners for up to 110% of the cost of building improvements that increase energy efficiency. First enacted on July 17, 2020, Italy has extended the incentives through December 31, 2023. 

The program covers 110% the cost to purchase and install more energy-efficient heating and cooling systems and extends this subsidy to all related improvements that ensure or increase their efficiency.

Opportunities may exist for U.S. companies with products or solutions in the following categories: 

  • Substitution of heating and air conditioning systems for single-family homes and some multi-family, residential buildings
  • home improvements for better insulation
  • improvements that increase a building’s ability to withstand earthquakes
  • improvements that increase the energy efficiency of new home heating and cooling systems, including doors, windows, insulation, and roofing
  • solar panels
  • recharging equipment for electric vehicles
  • elevators and other improvements to improve access for people with disabilities

Intelligent and Sustainable Buildings  

Italian companies, the public sector, and end-users are increasingly interested in sustainability. Opportunities exist for products with strong “green” performance attributes, in areas such as energy and water savings and indoor air quality improvement. The Green Building Council’s LEED protocols, which originated in the United States, are growing in acceptance in Italy and many building professionals take them into account for new energy-efficient structures. The European Green Deal’s objective of increasing the energy efficiency of public and private buildings and the growing number of companies operating in Italy that apply ESG (Environmental, Social, and Governance) criteria are also market drivers for more energy-efficient buildings.

Smart and Sustainable Transportation Infrastructure

Italy’s NRRP sets aside €32.1 billion for sustainable mobility, including investments to integrate more regions into the high-speed rail network and complete the rail freight corridors. The plan should boost sustainable local transport through the extension of cycle lanes, metros, tramways, and zero emission buses. This includes the construction of electric charging stations across the country and hydrogen refueling points for road and rail transport. It also sets aside money to “green” Italy’s ports. Opportunities may exist for U.S. companies with products, services, and know-how to make transportation and logistics smarter and more sustainable.

Port Infrastructure Modernization and Expansions:  

Italy will invest €7.4 billion to modernize and increase capacity at its ports between now and 2026. Much of this spending is earmarked to increase the size of the ships that Italy’s main container ports can handle through dredging, new breakwaters, and improved connections to road and rail links. Other funds will be spent on measures to make ports more ecologically sustainable or more efficient and secure through digitalization. U.S. companies with innovative solutions in these sectors may benefit from this increased public spending. 

These funds come on top of the projects already planned by the Ports of Genoa, Italy’s busiest container ports, which through 2023 plan to award €2.6 billion in tenders for a new breakwater, dredging, and an expansion of its shipyards. 


MCE Expocomfort.(March 12–15, 2024, Milan) - leading trade show dedicated to residential and industrial HVAC-R solutions.

CERSAIE (late September 2023, Bologna) - International Exhibition of Ceramic Tile and Bathroom Furnishings (CERSAIE) important ceramic tile industry trade show; main and historical focus is ceramics, but also covers sectors of surfaces and wall coverings, bathroom furnishings, and architectural finishes.

SAIE (October 2024, Bologna) - main construction industry trade shows; held in the autumn in even numbered years.

ME (November 15–18, 2023, Milan; formerly MADE Expo) - other main construction industry trade show that attracts international exhibitors; biannual show, usually held in odd-numbered years.

U.S. Commercial Service Italy

Joshua Lawrence, Commercial Specialist 

U.S. Commercial Service, U.S. Consulate Milan 

Tel: +39 02 6268 8539