The process of buying a property can seem daunting enough in your home country. But fear not, it’s not so difficult and the process in Italy is very similar to those of other countries. In reading this article, you’re one step closer to the Italian home of your dreams and hopefully will come away from it with less fear and more enthusiasm. If you haven’t considered the idea of purchasing property in Italy, we hope to get you thinking after discovering how simple it can really be. Going through a Real Estate Agent in Italy is a safe process, especially after a law passed requiring a strict selection of exams to be taken by each agent in order to be registered at the Chamber of Commerce. Every agent must with registered and therefore must take and pass the exams. This guide applies to off-plan and resale properties.
Offerta; purchase offer
The Real Estate Agent will assist in presenting a formal offer to the seller of the property. It will be written up in Italian and English along with the presentation of a down payment/deposit of 10%–20% of the purchase price. Should the offer be accepted by the seller, this payment serves as the legal bind of the sale. This is called the caparra confirmatoria. If either the buyer or seller would like to negate the sale, one of the parties involved can claim damages to the property and return the down payment. If the seller is the party to back out, the buyer may be eligible for a refund with additional fees paid to them by the seller.
Compromesso; preliminary contract
This is the phase which consists of all the details that will be outlined during the sale. All the questions about the sale will be answered during this step. Should the seller accept the offer, a preliminary contract is written with all this information.
The final purchase price and all the appropriate conditions of the sale are outlined within this contract. Also, it will include a detailed description of the property in question along with any allotted permissions or planning and cadastral details. When this contract is signed, the caparra confirmatoria is paid and the commission fee, or provvigione, is paid to the Real Estate Agent, or agente immobiliare.
Atto Notarile / Rogito; deed of sale
The deed of sale must be signed and transferred in the presence of a Notary, or Notaio. This is the only professional during this process with the legal authority to transfer properties in Italy from one person or entity to another. The buyer is responsible for hiring and paying the Notary. However, this person is a completely unbiased, independent, official of the public, responsible for ensuring the legality of all documentation during the sale. This is obviously the most important step so we recommend finding an English speaking Notary so it is the most comfortable and easy to understand everything during the process and you may also ask detailed questions and ensure clear, transparent answers, without miscommunications. We also recommend using a bank account to do the transfers and handling everything with a digital paper trail.
Final See & Paperwork
Within 3 months of the deed of sale completion, a copy of the paperwork should be available. This should be considered as 3 months after the Notary process completion and official purchase date.
Additional costs and taxes need to be paid also during this process. Three small taxes totalling €150 are paid to the Notary as the process is completed. The government also values the property in order to impose certain taxes. This is called the valore catastale.
If the buyer moves to Italy and applies for residence within 18 months of the sale, the registration tax or stamp duty, known in Italian as imposta di registro, is 2%–4% of the valore catastale. If the purchase is made as holiday home or investment property without the buyers attempt at residence in Italy, the tax goes up to 9%. Additionally, if the home is purchased for vacationing and sold within 5 years of the purchase, there is a capital gain fee of 20% of the earnings. Whatever the difference, if positive, in which the buyer sells the property for, 20% of that must be paid.
If this property is an investment with the intention to rent it for additional income, this income is subject to tax by the Italian government. Each year, the property owner must report the income amount made through this property with appropriate deductions (repairs, expenses, and local taxes paid). This income will be taxed by the tax authorities. In the buyer’s country of residence, this should also be reported with a double taxation agreement. This will ensure the buyer only needs to pay the taxes on this income once.
Local taxes are also a factor in property ownership. The IMU or TASI property tax, or imposta municipale sugli immobili, is a 0.7%–1% local council tax. The local government authorities decide on the percentage to be paid per year in two payments in December and June.
Agente immobiliare = Real Estate Agent
Offerta = the purchase offer
Valore Catastale = Government-determined property value, normally around 30%–50% of the commercial price of the property
Catasto = Local Land Registry Office
Caparra Confirmatoria = Down Payment
Compromesso = Preliminary Contract
Provvigione = Real Estate Agent Commission Fee
Rogito / Atto Notarile = Final Deed of Sale
Notaio = Notary
Imposta di Registro = Stamp Duty / Registration Tax
Imposta Muncipale sugli Immobili(IMU or TASI) = Property Tax