Each country has its specific bureaucracy and steps required for property
purchase. Property purchase in Italy has the series of steps and costs listed
below. By and large, excluding the costs and time involved in finding the
property of choice, the average buyer can expect the purchase process
itself (incl. taxes) to imply an extra 15% on purchase price.
Please read the Disclaimer
- Setting the bases for purchase: Find a property you are truly
interested in and be sure you wish to go ahead and purchase. An average
foreign buyer will make some 5 or 6 trips to the country before finding the
property of choice.
- To proceed with the purchase you will need to have an Italian tax code
("Codice Fiscale") if you wish to proceed. This is not difficult
to get (surprise surprise) and in fact will be necessary in order to
purchase a wide variety of goods and services in Italy.
- It would be advisable to set up a local bank account at this stage
- You might also consider the services of a specialised foreign exchange
operator as this can save you a few pips on the total purchase price wrt
your home currency.
- Agree a purchase price (henceforth "PP"). The form in
which this agreement takes place will depend on the channel of purchase you
happen to have followed: if it is through some sort of an agent you are
unlikely to get to speak to the vendor in person for obvious reasons. There
is little knowing what cut the real estate agency is actually taking but it
will tend to be in the region of 3 or 4% of PP. Does this give you any
obvious ideas on saving at least part of this 3-4%? Contact
- Initial Offer - A small deposit "Deposito di Garanzia"
may be paid at this stage in the region of some 5% of PP to ensure
preference over other would be buyers. It would be in order to have
completed a few formal searches first to make sure all is in order with the
property and it's present ownership rights. The surveyor employed for this
type of work is called a "Geometra".
- Preliminary Contract - this is known as the "Compromesso".
This document will detail the property and its whereabouts, the agreed PP,
the date for completion (usually a few months from the compromesso) and any
particular conditions agreed with the vendor/mediator. An advance payment is
made at this stage of about 20% of the agreed PP. Turning back at this point
can be expensive for both parties, especially the vendor: the would-be buyer
risks the moneys paid to date whilst the vendor risks twice the amount.
- Final Contract - this is known as the "Rogito". It
happens on the date previously defined in the Compromesso agreement. The
remainder of the PP is paid up at this point, usually by bank transfer. A
little forward planning with exchange rates might save you enough money for
your celebratory lunch. The papers are drawn up by an independent solicitor
which in Italy is called the "Notaio". The Notaio will also be
involved in making sure that the ownership is transcribed into the public
registers and that each party is sent a copy of the ownership papers and
contracts. The notaio's fees are some 2-4% of the PP.
- The fun starts: There are a few things to get in order, rather like
moving homes really. You need to register at the local council for council
taxes such as housing tax and refuse. You will also need to call your chosen
utility operators to set up services, not to mention any builders, landscape
- Additional fees and costs:
- Yes, Italy has its equivalent of stamp duties. How much tax you pay on
your purchase will depend on a few factors such as whether you are resident,
whether this is your first home and whether you are buying new build
directly from a construction company. It can be anything up to 20% of the declared
value of the property, average 10%. This subtle difference between
declared value and the actual PP is rather like the difference between the
face value of a share and the actual stock price on the stock exchange.
Again, a little forward planning can help you minimise tax surprises.
- Mortgage arrangement fees. Will tend to be in the range of 1% of the PP.
- Bank Transfers. Depends on the bank(s) and the type of transfer involved.
Please read the Disclaimer
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Written by Giovanni Milani-Santarpia for www.mariamilani.com
- Italy holiday rentals and Italy
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