Italy, with its combination of natural beauty, cultural richness and distinctive lifestyle, is one of the most popular destinations for foreigners. The varied landscapes, from beaches to hills to mountains, offer a variety of unique experiences, while Italian cuisine and the Italians' sense of hospitality make a stay in the country even more pleasant.
Many foreigners are attracted to the Italian lifestyle, often characterized by the joy of life and simplicity compared to other cultures. This interest leads many to look for a home in Italy that not only offers modern comforts, but also allows you to fully immerse yourself in local life.
For those who wish to purchase a property in Italy, it is advisable to contact a specialized real estate agency. Experienced real estate agents can facilitate the purchasing process, ensuring security and transparency. By understanding local laws and procedures, these professionals can assist foreign buyers every step of the way, from property search to negotiation and closing of the deal.
This support is also fundamental for Italian owners who intend to offer their property on the foreign market, especially because many foreigners may be wary due to their limited knowledge of Italian regulations and prefer to purchase properties offered by specialized real estate agencies. Collaboration with a real estate agency allows you to overcome these mistrusts, offering a complete service that includes in-depth verification of each proposed property, thus ensuring a safe and surprise-free purchase.
In summary, Italy not only attracts foreigners for its beauty and lifestyle, but also offers an accessible and safe real estate market thanks to the professionalism of specialized real estate agencies.
Who can legally buy a house in Italy?
There is no limit or restriction in the case of a citizen with an EU passport or an EFTA country (there are 4 EFTA countries, namely: Iceland, Liechtenstein, Norway and Switzerland) or a stateless person resident in our country for more than three years.
In other cases, foreigners can purchase a property in Italy if they are in possession of a valid residence card or residence permit.
However, if they are foreigners not regularly residing in Italy, the purchase of a property in our country is permitted only if provided for in an international treaty and on condition of reciprocity. The reciprocity condition provides that a foreigner can buy a house in Italy as long as an Italian can do so in the foreigner's country of origin. To verify the condition of reciprocity, you can visit the Italian Ministry of Foreign Affairs https://www.esteri.it/it/politica-estera-e-cooperation-allo-sviluppo/diplomazia-giuridica/condizreciprocita/
Other technical-legal aspects to take into consideration:
TAX CODE Anyone purchasing a house, including foreigners, must have an Italian tax code. Without this requirement it is not possible to proceed with the signing of the final deed of sale. Obtaining the tax code from the Revenue Agency is a simple and quick process.
TRANSLATIONS AND POWER OF ATTORNEY: in the event that the foreign citizen does not speak the Italian language, the notary requires the presence of a bilingual interpreter and the drafting of all documents in two languages. Furthermore, during the signing of notarial deeds, the presence of two witnesses is required, one of whom must know the foreigner's language, in addition to Italian. To avoid an interpreter and witnesses, you can use a notarial power of attorney. To make a power of attorney, it is sufficient for the person who intends to give the power of attorney to contact a notary bringing with them their identity card and tax code, together with a copy of the identity card and tax code of the person to whom they intend to grant the power of attorney. Furthermore, being a unilateral act, the power of attorney can be drawn up even if the attorney is not present at the time of signing. In the event that the person granting the power of attorney is a foreigner residing abroad, then he or she will have to contact a notary in the country in which he or she is located and prepare a special power of attorney translated into Italian. In these cases, however, it is necessary for the Power of Attorney to be "astilled" or “legalized”. The apostille is a sort of stamp that certifies the authenticity of the signature present in the document and is affixed directly by the Notary who drew up the power of attorney. Legalization, which is more complicated, must instead be carried out at the Italian Consulate in the same country. The choice between one and the other depends on the foreign country in which the power of attorney was drawn up: if it is among those that adhere to the 1961 Hague Convention, the apostille will be sufficient, otherwise it is necessary to proceed with legalization at the Italian consulate present in the same country.
FUNDS TRANSFER: for the purposes of the sale, the foreign citizen can open a current account at an Italian bank, or ask the notary to make a dedicated account available into which to pay the sums of money due. It will therefore be the duty of the notary, as guarantor of the operations, to carry out the transfers in favor of the seller and complete all the formalities. Clearly this last option is decidedly more expensive because the Notary will ask for a fee to act as guarantor with the dedicated account.
PROCEDURE FOR THE PURCHASE
1) LAND REGISTRY AUDIT, TOWN PLANNING OFFICE, CONSERVATORY
Before formalizing the purchase is essential to carry out these checks, it will be the Agency to carry them out and to deliver the documentation:
- Title of provenance: is the document certifying ownership of the property;
- Survey and cadastral plan: requires a survey to verify if the property is regularly registered with the Tax Office and to verify if the plan filed complies with the status of the places, the project approved and filed with the municipal planning office;
- Municipal planning office: to check whether the building has a regular building permit, with an approved project and a certificate of usability;
- Conservation of real estate registers: to verify whether mortgages or other transcripts or inscriptions are imposed on the property.
2) FORMAL PURCHASE PROPOSAL
When a customer, after visiting several properties, decides to proceed with the purchase of one of them, the negotiation begins with THE PURCHASE PROPOSAL.
The purchase proposal must be made in writing and must include detailed information on the identification of the property, the price offered, the methods of payment and all the conditions that the proposer wants to include in formalizing his offer.
Once the seller accepts the proposal he undertakes to enter into the next preliminary contract of sale at the price and conditions indicated in the proposal accepted.
3) THE PRELIMINARY CONTRACT
The preliminary contract (said compromise) is the agreement by which the parties are mutually obliged to conclude a subsequent final contract (deed).
With the preliminary contract, in essence, the ownership of an asset is not transferred, but it is obliged to such a transfer at a later time (e.g. because you have to apply for a mortgage and it takes time to instruct the practice or to give the seller time to free the house etc.).
The preliminary must already contain the essential elements of the next final contract.
The deed will then be drawn up and executed one to six months after the Compromise but the parties may freely agree.
However, it must be remembered that the purchase proposal, if signed and accepted, already creates a legally binding relationship between the parties and sometimes the phase of conclusion of the preliminary contract is skipped and you go directly to the Notary Deed.
At the same time as the conclusion of the preliminary contract, the buyer delivers to the seller the deposit, equivalent to about 10% or 20% of the purchase price. The seller can decide to withdraw from the contract only by returning to the buyer double the deposit or the deposit paid plus a sum equivalent to the deposit itself.
Example: By paying a deposit of € 5,000 the buyer will have back € 5,000 of the deposit plus other € 5,000 as a penalty.
In the event that the buyer withdraws, he will lose the entire deposit.
The seller (not defaulting) and the buyer (not defaulting), depending on the case, can still choose to apply for the execution of the contract (the court will oblige the defaulting party to conclude the final contract) or termination of the contract, claiming damages.
You should also remember that the deposit can vary depending on many factors. But usually the lower the cost of the house, the higher the value of the deposit to be paid and vice versa.
Sometimes, in addition to the "deposit", the buyer pays a "down payment" which is an advance on the price of the sale. We prefer this solution when we want to give a very high sum to the stipulation of the preliminary but we prefer to reduce the mutual risk. In fact in case of default of the buyer the amount paid as a deposit will be returned to him and will lose only the amount paid as a deposit. In case of default of the seller must return deposit and deposit and another amount as compensation equal to the deposit.
Example: By paying a deposit of € 5,000 and a deposit of other € 3000 you will have back € 5,000 of the deposit, € 3000 of the deposit and more € 5,000 as a penalty (or double the deposit).
4) THE NOTARIAL DEED
The notarial deed, or final contract, consists in the final act of the negotiation of real estate.
It represents, in fact, the real act of sale, that is, the moment through which the definitive passage of the property from the seller to the new owner takes place.
It is drawn up by the notary who can be chosen by the buyer and contains all the elements necessary to identify the property in question (which are already contained in the compromise).
It is possible that the parties choose to go to the deed directly without going through the compromise.
In the case of joint ownership, the deed must be signed by all the co-owners, or by a representative to whom a notarial power of attorney has been conferred.
The notary deed must be transcribed by the notary. The original remains preserved in the Notary’s documents.
5) PURCHASE COSTS
• REAL ESTATE BROKERAGE
The commission due to the agency is around 4% of the purchase price + VAT (see the costs in detail on our page Agency fees).
Once the communication has happened to the proposer of the acceptance of the proposal by the owner of the good, the deal is to be considered concluded for the agency pursuant to art. 1755 Cod. Civ. with relative right to commission. The commission is not divided between seller and buyer, but the first and second pay each 4% of the purchase price + VAT.
• REGISTRATION TAX - MORTGAGE TAX- CATATSALE TAX
These are the 3 main taxes to be paid when you buy a property together with other minor taxes and taxes and are paid to the notary to the notary deed together with his fee.
The "cadastral value" represents the tax base on which these 3 taxes are applied and which is currently usually lower than the price of the sale and is calculated based on the cadastral rent attributed to the property and indicated in the cadastral survey.
But the rule of "cadastral value" is not applicable to all trades; in fact, for example, if the buyer buys not as "private", but as "company", the tax base will be given by the commercial price of the property. The amount of these three taxes to be paid therefore varies depending on the type of property and the "characteristics" of the buyer and seller:
A) Trades subject to proportional registration tax calculated on the cadastral value (ie those where the seller is a private individual; or a company that has not built or renovated the property; or a company that has built or renovated the property for over 5 years and in existence does not exercise the option VAT):
1. Registration fee:
- purchase as first home (bring residence within 18 months): 2% (always to be calculated on the cadastral value);
- purchase as a second home: 9% (to be calculated on the cadastral value if you buy a private individual or to be calculated on the price declared in place if you buy a company or a natural person who buys as a sole proprietor or as a professional);
Registration fee can never be less than €1,000
2. Fixed mortgage tax: EUR 50;
3. Fixed cadastral tax: 50 euro.
B) Sales subject to IVA (that is, those in which the selling party is the company that has built or renovated the property for less than 5 years; or the company that has built or renovated the property for more than 5 years and is currently exercising the VAT option):
1. IVA
- purchase as first home (bring residence within 18 months): 4% (to be always calculated on the price declared in place);
- purchase as a second home: 10% (always calculated on the price declared in place);
- luxury building: 22% (to be calculated on the price declared);
2. Fixed registration fee: EUR 200;
3. Fixed mortgage tax: EUR 200;
4. Fixed cadastral tax: EUR 200;
This summary scheme is valid as a general rule, but before buying a property it is always good to check the exact amount of taxes to be paid to avoid unpleasant surprises later. The agency will get a quote from the Notary to determine what taxes are payable in the specific case.
NOTARY FEES
In most cases, notary fees are paid for the preparation of the deed by the notary, which are added to the cost of taxes. But I can also be requested for the preparation of the preliminary contract if the parties draw up the compromise through the figure of the notary who will then register the original on record.
The amount varies from city to city and is calculated based on the declared value of the property, but generally they are similar, at least from the point of view of notary ordering. For example, a notary of a large city such as Milan center will be able to charge notarial fees higher than the law firm of the small town, mostly for management expenses and not instead of notary fee that is always the same.
• OTHER EXPENDITURE
These may include, for example, legal fees; surveyor or architect for property inspection; moving company; etc.
6) OPERATING COSTS
• IUC (single municipal tax)
It is a tax that includes 3 taxes: IMU (you do not pay on the first house unless it is a luxury house), TASI (tax on municipal services such as road maintenance, public lighting, etc.) and TARI (waste, garbage). Who owns a property in Italy, whether resident or non-resident, is subject to the payment of the IUC whose amount is divided into two/ three instalments.
IMU is applied on the cadastral value of the property plus a 5%. The amount shall be further multiplied by the coefficient corresponding to the cadastral category.
The base rate for second homes is 0.76%, but the municipality may decide to increase or decrease it by 0.3%. The same is true for TASI. But it must also be considered that the sum of TASI and TARI cannot exceed 10.6%. The TARI is calculated on the basis of the square meters.
• USERS
Electricity, water, heating, telephone, gas usually require the payment of a fixed plus a part for consumption and are charged every two months.
• LIVING COSTS
If you buy a property that is part of a condominium, you will have to pay the cost of managing the condominium areas that will vary depending on the size and services offered (e.g. swimming pool, garden, gym etc.).
