Any single figure for "the cost of living in Italy" is meaningless. The country runs on a north-south gradient that affects rent, wages, services and everything downstream of them. Treat the figures below as orientation, not quotes.
The expensive north
Milan is a European capital with European capital prices: a one-bedroom flat in a decent central area commonly runs €1,100–1,700 a month, and competition is fierce. Bologna, Florence and the lakes sit somewhat below that but have been pushed up hard by tourism and short-lets. Rome is expensive in the centre and drops sharply a few tram stops out.
The middle
Turin is the value outlier among big northern cities. Most of Umbria, Le Marche and inland Tuscany offer small-city life at perhaps half of Milan: €500–750 for a decent flat, and houses to buy at a fraction of what the postcard suggests.
The affordable south
In Puglia, Calabria, Sicily, Abruzzo and Molise, €400–600 rents a good flat and €600–900 rents a house with outside space. Property to buy is dramatically cheaper. Wages are correspondingly lower, which matters if you intend to work locally and not at all if your income comes from abroad.
If you earn abroad and spend in the Italian south, the arithmetic is unlike anywhere in western Europe.
The costs that are the same everywhere
- Food is cheap and very good. Markets undercut supermarkets; seasonal produce is inexpensive nationwide.
- Coffee is €1–1.50 at the counter, essentially anywhere.
- Eating out is affordable away from tourist centres: €25–35 a head with wine at a proper trattoria.
- Electricity and gas are expensive by European standards, and heating an old stone house in a cold winter is a real line item people forget.
- Trains are good value, especially regional ones.
- Cars are expensive to run: fuel, insurance and the annual bollo.
The hidden variable: seasonality
In tourist towns, rents and sometimes prices move with the season, and long-term flats can be scarce because owners prefer summer lets. In the south, a coastal town in February can be almost closed. Both are arguments for renting for a year before committing.
And the discount nobody prices in
Speaking Italian is worth money here. Local rents negotiated directly, tradesmen found by recommendation rather than through an English-speaking agency, and the ordinary market price rather than the foreigner price. It is a small, steady, permanent dividend on the time you put into the language.