How much is your salary really worth? The answer depends far less on the figure on your payslip and far more on the municipality where you spend it. In Italy, average declared income ranges from €98,577 in Portofino to €7,349 in Cavargna, in the province of Como: a ratio of more than thirteen to one. But the real surprise comes when you cross incomes with house prices: the cities where people earn the most are almost always the ones where every euro buys the least.
In this analysis we compare the IRPEF incomes declared to the Ministry of Economy and Finance (tax year 2023, the latest available) with 2025 OMI property prices for sales and rents, to understand where real purchasing power in Italy is highest and where a salary simply evaporates.
Fifteen Years of Incomes: Nominal Growth
Let's start with the national picture. Average declared income in Italy rose from €19,102 in 2008 to €24,833 in 2023: nominal growth of 30% in fifteen years. The series, however, shows two clear scars: the long post-crisis stagnation (between 2008 and 2009 growth was just €4) and the drop of 2020, the pandemic year, when average income fell from €21,772 to €21,541.
The subsequent recovery was rapid in nominal terms: +€3,292 between 2020 and 2023. But over those same years inflation outpaced incomes in much of the country, and above all house prices in the big cities pulled away from any salary dynamic. This is where the gap between nominal income and real purchasing power is born.
Average declared income in Italy, 2008-2023
National average IRPEF income per taxpayer, in euros. Source: MEF.
Where People Earn the Most: The Income Ranking
The geography of high incomes is well known but always striking. Portofino leads with an average income of €98,577, followed by Lajatico in Tuscany (€61,361) and Basiglio in Milan's hinterland (€52,147). The top ten includes Courmayeur (€43,250), Cusago, Forte dei Marmi, Torre d'Isola, Pino Torinese and, tenth and first among large cities, Milano with €40,521.
Milano is the only big city in the top positions: Roma stops at €31,360, Bologna at €31,956, Firenze at €30,773, Torino at €28,889, Napoli at €24,556. The rest of the upper ranking is made up of small upmarket residential towns, elite tourist resorts and wealthy belts around the northern metropolises.
The 10 municipalities with the highest average income
Average IRPEF income per taxpayer, tax year 2023. Source: MEF.
Where People Earn the Least
At the other extreme, Italy's lowest incomes are not found only in the South. Cavargna (Como) closes the ranking with €7,349, followed by Gurro (€8,582) and Valle Cannobina (€9,335), both in Verbano-Cusio-Ossola: border mountains between Lombardy and Piedmont, where many residents work in Switzerland and declare little in Italy. Just behind come Roseto Valfortore in Puglia (€11,219), Dinami in Calabria (€11,497), Goro in Emilia-Romagna, Mazzarrone in Sicily and Verbicaro in Calabria.
The bottom of the ranking tells of two different Italies: the Alpine cross-border municipalities, where the tax data understates real living standards, and the inner areas of the South, where low income genuinely reflects fragile economies and depopulation.
The 10 municipalities with the lowest average income
Average IRPEF income per taxpayer, tax year 2023, ascending order. Source: MEF.
The Cost of Housing: The Variable That Changes Everything
Income is only half of the equation. The other half is how much it costs to live, and in Italy the item that most differentiates territories is housing. According to 2025 OMI data, buying in Portofino costs on average €10,767 per square metre, in Cortina d'Ampezzo €9,419, in Capri €7,738. Among the big cities, Milano is the most expensive at €4,948 per square metre, against €3,001 in Roma, €2,976 in Firenze, €2,901 in Bologna, €2,370 in Napoli and €2,058 in Torino.
At the opposite extreme, in Salaparuta and Poggioreale, in the province of Trapani, a home costs on average €225-230 per square metre: in Milano, the same money buys roughly one twenty-second of the surface.
The municipalities with Italy's most expensive homes
Average sale price per square metre, OMI 2025 quotations.
The Milan Salary Paradox
Let's put the two figures together. In Milano the average income is €40,521, the highest among the big cities; but at €4,948 per square metre, a 70-square-metre flat costs around €346,000, that is more than eight and a half years of average gross income. In Torino the same calculation gives very different results: an average income of €28,889 and a price of €2,058 per square metre mean around €144,000 for 70 square metres, less than five years of income.
In other words: someone moving from Torino to Milano for a salary 30% higher finds homes that cost 140% more. This is the Milan salary paradox: nominally the richest in Italy among the metropolises, in real terms eroded by the cost of housing. The same pattern, on a smaller scale, applies to Firenze and Bologna compared with cities like Torino, Palermo or Catania.
The Cost-of-Living Index, Municipality by Municipality
To compare territories we use DatiItalia's composite cost-of-living index, which combines housing prices and local price levels on a 0-100 scale. At the top, with a score of 100, are places like Courmayeur, Pré-Saint-Didier, Camogli, Ortisei and Selva di Val Gardena: elite tourism and an off-the-scale property market. Milano follows at 99.3, Roma is at 67.4, Napoli at 56.6, Torino at 43.5.
At the bottom of the scale, with an index close to zero, we find the Emilian Apennines (Albareto, Bore, Compiano and Valmozzola in the province of Parma), Santopadre in the province of Frosinone and Poggioreale in Sicily: here both housing and everyday prices are at national lows.
Cost of living: Italy's most expensive municipalities
Composite cost-of-living index (0-100): combines housing prices and local price levels. Year 2025.
North and South: Mapping the Divide
At the regional level, the highest average cost-of-living index is recorded in Trentino-Alto Adige (42.5), Liguria (34.6) and Valle d'Aosta (34.5), driven by Alpine and coastal tourism. The big productive regions of the North follow: Lombardy at 21.4, Emilia-Romagna at 20.7, Veneto at 20.3. The South is almost entirely below average, with Calabria at 11.2, Molise at 8.6 and Basilicata at 8.2.
The key point is that the price gap is wider than the income gap. Between Lombardy and Calabria average incomes differ by roughly 40-50%, but house prices in their respective main cities can differ by 100-200%. This is why a medium-low income in the South can translate into a better standard of living than a medium income in the North, at least for those who still have to buy a home.
Where the most expensive municipalities cluster
Regional breakdown of the 50 municipalities with the highest cost-of-living index (2025).
Rents Erode Purchasing Power Too
The reasoning does not apply only to buyers: rents follow the same geography. In Milano the average rent is €15.82 per square metre per month, the highest value among the big cities and twelfth overall in Italy, behind only resorts like Portofino (€24.47), Cortina d'Ampezzo (€21.82) and Capri (€19.35). Roma stops at €12.01, Firenze at €10.16.
Translated into monthly rents for 70 square metres: about €1,100 in Milano, €840 in Roma, €710 in Firenze. For a young worker on the city's average income, a Milan rent absorbs about a third of gross income: it is the item that, more than any other, explains why Italy's highest salary yields less than it seems. At the opposite extreme, in dozens of municipalities of the Apennines and the inner areas, the average OMI rent falls to €1 per square metre per month: €70 a month for the same space that costs €1,100 in Milano.
This is where remote work changes the game: the same payslip, moved from one market to the other, can free up a thousand euros a month on housing alone.
The 3D Map: House Prices and Incomes Compared
The three-dimensional map below summarises the whole analysis: the height of each column represents the municipality's house prices, the colour the average income of its residents. The tall, dark columns (high prices, high incomes) cluster in Milano and its hinterland, along the Ligurian coast and in the Alpine tourist valleys. The tall but pale columns flag the markets where prices have risen faster than local incomes: holiday resorts, but also parts of the great art cities.
The low, pale columns, finally, are inner Italy: the Apennines, the rural South, the non-tourist mountains. Here housing is cheap, but incomes are low too and services thinner on the ground.
House prices by municipality, coloured by income
Height: sale price per square metre (OMI 2025). Colour: average declared income (MEF 2023).
Where Living Pays Off With Your Salary
Let's sum up. If the goal is to maximise purchasing power, the data points to three strategies. First: the mid-sized northern cities with still-contained prices, such as Torino, where the ratio between income and housing cost is among the best in Italy for a large city. Second: the southern provincial capitals with solid economies, where incomes are lower but prices are proportionally far lower still. Third, made possible by remote work: keeping a big-city income while living in a low-cost municipality, where the cost-of-living index is a fraction of Milan's.
There is a flip side: the cheapest municipalities are often those with fewer services, fewer opportunities and shrinking populations. Purchasing power is a fundamental variable, but not the only one. To weigh them all, you can compare any pair of Italian municipalities with DatiItalia's comparison tool: income, prices, demographics and environment, side by side.
Methodological note: incomes are average IRPEF incomes per taxpayer declared to the MEF for tax year 2023; property prices are OMI 2025 quotations; the composite cost-of-living index is calculated by DatiItalia on a 0-100 scale. Incomes in cross-border municipalities understate earnings actually received abroad.