Buying Property in Italy
Guide to Italy
Italy is located in Southern Europe and is characterised predominately by the two mountain regions the Alps and the Apennines. Italy offers a unique variety of landscapes: a perfect balance of seas, mountains, hills and flatlands, and thanks to a meditereanean climate makes Italy one of the most interesting and friendly countries for visitors.
Valle d'Aosta
The smallest of Italy's regions Valle d'Aosta is a mountainous area in north-western Italy, bordered by France in the west and Switzerland in the north. This picturesque region offers spectacular views, an abundance of castles and a number of high-quality ski resorts.
Piedmont
Dominated by impressive peaks, Piedmont is surrounded by three sides of the Alps mountain range making the region a paradise for hikers, winter sports enthusiasts and nature lovers. Known as the land of wine and fine cuisine this picturesque region is a memorable place where every village has something to see.
Lombardy
Lombardy is the wealthiest, most developed and most densely populated region in Italy. This region boasts some of Europe’s largest and most beautiful inland waterways including Lake Como and Lake Garda. The unmistakable atmosphere and culture, as well as the regions capital, Milan make this a fantastic location to visit.
Trentino Alto Adige
Located along the north-eastern border with Austria, the territory of Trentino-Alto Adige is mainly occupied by mountains. This area has a number of popular ski resorts and is rich in rivers, lakes and has a number of beautiful medieval towns – it is an enchanting place to stay.
Friuli Venezia Giulia
This area of Italy is still relatively untouched by tourism. Located in the north-eastern corner of Italy the region is blessed with rolling hills, a lovely stretch of coastline and a highly developed wine culture.
Veneto
Located in the north-eastern part of Italy, Veneto is home to the beautiful city of Venice and Verona, home to Romeo and Juliet. The region offers 200 km of coastline looking out onto the Adriatic Sea with wonderful golden sandy beaches, mountains and a large area of plains surrounded by hills.
Liguria
Liguria located the north-west, is one of Italy’s smallest regions but also one of the most popular. The Ligurian coast is a stretch of sand and pebble beaches with a number of lovely beach towns. The area also has a number of historic and interesting inland towns and is home to the capital of the region Genoa.
Emilia-Romagna
Emilia-Romagna is centred around the ancient city of Bologna. It is the second richest region of Italy, from its east coast beaches to ancient city states, Emilia-Romagna offers stunning countryside and perhaps Italy's most culinary masterpieces.
Tuscany
Tuscany is probably one of the best known regions in Italy and is considered by some to be the most beautiful region. Tuscany offers amongst the best beaches in the Mediterranean and breathtaking landscapes including the Tuscan hills and mountains. The area is also home to the cities Florenence, Lucca and Pisa.
Umbria
Umbria is a quiet, central region of Italy and also one of its smallest. The region is mostly mountainous and hilly and presents a landscape rich in woods and water resources. Still very much in the shadow of neighbouring Tuscany, Umbria is the home of more saints, monasteries and related art that any other region in Italy.
Marche
Marhce is located in the centre of north Italy. It is mostly an agricultural region offering both the Apennine Mountains and the Adriatic coast. Known by some as Italy’s best kept secret, this rural part of Italy has been relatively untouched by tourism.
Abruzzo
The Abruzzo region is essentially hilly and mountainous and stretches from the Apennines to the Adriatic Sea. Still very traditional Abruzzo is a true hidden treasure; its eastern border is marked by vast sandy beaches and in the west there are sloping hills and narrow plans dotted with small hill towns.
Molise
The region of Molise is located in south-central Italy, the second smallest of the regions. It is also one of the least populated Italian regions and only in recent years has tourism here begun to expand and now has some well-known winter sport resorts. The area is rich in waterways, which cross the land from the Apennine to the Adriatic Sea.
Lazio
Lazio is located in central Italy and is centred around the city of Rome. Lazio has a historical, artistic and cultural heritage with an abundance of natural beauty including the volcanic lakes of Bracciano, Bolsena, and Albano. Apart from Rome, this region is relatively unknown but offers many miles of sandy beaches and a rich culture.
Campania
Campania is a region of Southern Italy that boasts beautiful landscapes and a spring-like climate. Campania is home to places renowned for natural beauty such as Sorrento, Capri and the Amalfi Coast. From dazzling coastlines to unequalled Roman ruins – the region offers so many places to visit, that it’s quite impossible to give the whole area justice.
Basilicata
Basilicata offers great variety of scenery over a relatively small territory and provides tranquillity in the isolated areas of Lake Monticchio and Metaponto. Located in the south of Italy this region is still relatively unknown but has considerable tourist potential
Puglia
If you are looking for a region less crowed and completely different from Northern Italy then Puglia (or Apulia) in the south-eastern region of Italy is the place to consider. Often referred to as the ‘heel on the Italian boot’ Puglia has some of the brightest seas, diverse architecture and most mouth-watering cuisine in Italy.
Calabria
Calabria is the southernmost tip of Italy's peninsula which occupies the "toe" of the country. This region is very popular with Italian holidaymakers but still relatively undiscovered by the rest of us. Calabria is surrounded by the sea on three sides with mile upon mile of sandy beaches. The landscape is of wild beauty with spectacular mountain walks and scenery.
Sicilia
Sicilia ‘the island in the sun’ is the largest island in the Mediterranean Sea. The region offers a rich landscape of fascinating beauty; from majestic mountains (incl. Mount Etna), lush forests and orange / lemon orchards to ancient fishermen’s villages, beautiful beaches and crystal clear waters.
Sardegna / Sardinia
Sardinia is the second-largest island in the Mediterranean. The excellent climate, fantastic beaches and coastline make this a hot spot for tourism, especially the Costa Esmeralda (Emerald Coast). The area is rich in history and legends with a number of charming sea towns and archaeological ruins. The local traditions and dialects make Sardinia a truly fantastic Italian experience.
Practical Information for Buying Property in Italy
Top 10 Tips
1. You may find a bargain by looking outside tourist hotspots such as Tuscany and the Ligurian Riviera.
2. If you are only seeking a holiday home, ensure maintenance levels are low.
3. If buying a property to rent out when you are not using it, yields will be low if it is not in much desired tourist zones.
4. Local customs often determine rules for buying property in particular regions.
5. Ensure that the entire property has valid planning permission.
6. Deposits in Italy on property can be much higher than in Ireland.
7. If you withdraw from sale after signing the Compromesso (initial agreement), you will lose your deposit.
8. A public notary (notaio) is responsible for completing the sale.
9. Total costs (fees and taxes) amount to about 10 – 15 % of the property purchase price.
10.You are likely to need the services of an Italian lawyer or one in Ireland with a good knowledge of Italian property.
Key Phrases
ENGLISH - ITALIAN
Italian Lawyer - Avvocato
Initial agreement to buy (binding) - Compromesso
Architect / Surveyor - Geometra
Property Tax - Imposta ipotecaria e catastale
Public Notary - Notaio
Neighbors’ right to buy adjoining property - Prelazione
Completion of Contract - Rogito
The Italian Property Market
The Italian property market grew significantly during the late ‘90s and the first half of the current decade but slowed down in 2006 and properties, both residential and commercial often represent better value than similar real estate in Ireland, Britain, France or Spain.
Significant regional variations in prices can be found and a villa in Tuscany will set you back by much more than a similar residence in Southern Italy. Deterred by perceptions of bureaucracy, outsiders do not buy property in the numbers that have been seen in the Iberian countries and Italy does not have the same number of large scale tourist developments that dot the Spanish and Portuguese coasts. Buyers in Italy tend to do so for the culture and way of life.
While areas such as Tuscany, the Ligurian Riviera, Venice, Sardinia and Sicily remain popular with foreign buyers, many other areas are only now being explored and it is still possible to obtain better bargains in these lesser known areas.
Before buying in Italy, determine your budget and if you are obtaining a mortgage from an Irish financial institution, make yourself aware of the sum available to you and any terms and conditions applying.
How to Find a Property Agent
There are some agents in Ireland who assist in buying Italian property (not as many as for France, Spain or Portugal, however) and of course, some Italian agents advertise on the web and in magazines and supplements in Ireland. It makes sense to contact such agents before you travel to an area to look at property. Exclusively Italian property exhibitions are not as common in Ireland as for other destinations.
You will need to decide on the type of property for which you are looking. Is it a holiday home to be used a few weeks in the year (the Tuscan villa or the ski resort escape) or is it a more permanent residence. A holiday home ideally will require little maintenance.
Make sure that you make appointments with agents in Italy in advance. Ensure that the agent is licensed by their local Chamber of Commerce. Give the estate agent a clear understanding of what you seek in a property. Be prepared for the types of property you are viewing i.e. wear appropriate clothing. Take a good local map and have a list of questions prepared.
Legal Issues
It is advisable that you use the services of an Italian avvocato (lawyer) or an Irish solicitor who has a good knowledge of the Italian property market. You will also be dealing with a notaio, a public official who acts for both sides who is legally empowered to witness and validate deeds and contracts.
Generally, only a notaio can witness the legal deed of sale (scrittura private autenticata), and perform the vital task of registering the sale at the land registry (ufficio diet pubblici registri immobiliari).
The notaio will carry out the necessary searches on a property – planning permission, title, rights of access, ownership etc. His or her fee is legally fixed and is on a sliding scale according to the property sale price. The notaio will also register the sale for tax purposes. His or her role is not to engage in bargaining on your behalf and that is why an avvocato or well versed Irish lawyer is recommended.
You should also look at employing a geometra, a sort of surveyor who can carry out a checklist on the property. The Italian estate agent may recommend a local geometra. The geometra will survey the physical boundaries of the property for sale to make sure that it actually does conform with what is listed on the legal description that is subject to a contract for sale; this is especially important for older Italian properties.
The Compromesso
When you’ve found your property, you can make an offer to the seller. If the vendor accepts your offer, this is formalised via the contratto preliminare or compromesso.
The contract stipulates that both parties agree to buy and sell the property, and sets out the terms and conditions of the sale. The contratto will usually be prepared by the estate agent. You should get this checked by your legal adviser. On signing, you will usually pay a deposit of at least 10 per cent of the purchase price. In the case of certain properties, the deposit can be much higher.
Both sides are bound by the Compromesso. An attempt by either side to back out gives the other party the right to force the sale through or seek damages. For their part, the vendor can keep your deposit should you renege. You can register the compromesso, protecting your deal against the rights of third parties.
Prelazione
The principle of prelazione, third parties’ right to buy, allows neighbours adjoining the land first refusal on the property at the asking price. This rule was particularly designed for rural areas where a small farmer might wish to expand his farm (and thus reverse the ruinous sub-division of agricultural estates that once bedevilled much of the countryside).
Prelazione is officially limited to ‘direct growers’ or coltivatori diretti. Once the compromesso is signed, the contract and your name are sent to all neighbouring farmers, who have 30 days to decide whether to match your offer. You cannot ask them to waive this right.
Sitting tenants and people conducting a business from the property also have a right to buy. You may be unsurprised to learn that your sale can be stymied by interested parties putting in a last-minute offer and having to be bought off.
The Rogito
The final stage is the signing of the deed of sale, the rogito, the equivalent of completion in an Irish property transaction. It normally takes place 1-3 months after the compromesso. Although the process is dying out, it should be noted that as taxes and fees are worked out on the declared price, this may be different to the price actually paid.
If you cannot be present at completion, you can assign power of attorney to your Italian lawyer or to someone in Italy that you trust to manage the signing.
For completion you’ll need to have your codice fiscale (tax code), your passport and proof that the mortgage or purchase funds are in order. The rogito is signed and the balance of the purchase price handed to the vendor.
Insurance
From the signing of the final contract the buyer is responsible for the insurance of all the buildings on the property.
Taxes, Fees and Charges
You are likely to end up paying between 10 and 15% of the purchase price in various taxes, fees and charges. You’ll be paying real estate tax (imposta ipotecaria e catastale) of 3 per cent, stamp duty of 7 per cent, a local tax (valore catastale) of between 0.4 and 0.8 per cent, your mortgage fees and estate agents’ fees. Both seller and buyer pay the estate agent, usually 3 per cent apiece. You’ll also have to pay the geometra, notaio and connection fees to the water, electricity and gas mains.
The Imposta Comunale sugli Immobili is an annual council tax calculated on the value of the property. It is payable twice a year in June and December but it may be possible to pay it for the year in December if non resident.
Planning Permission
Planning laws in Italy can be quite strict and seemingly bureaucratic to the outsider. They also vary from region to region so it is advisable that you contact the local Council if you are planning to build or extend. It may be particularly difficult to obtain planning permission (permessi comunali or concessione edilizia) if the building is of historical importance or in a scenic area. In the case of historic buildings, you may even need the permission of the National Ministry of Culture.
In most cases, there are restrictions on renovation; for example, you may not be able to change the windows, doors, colour of exterior walls, entrances, staircases or build garden walls. Italian law requires a ceiling height of 2.75 metres for living space (except for property located in villages, which are exempt) and you may need to raise the roof or lower the floor when converting a building.
You can always apply for and try and obtain permission before you buy a property if you plan to make changes. Never start any building work before you have full planning permission.
Additional Information
Major difficulties can result if a property has been willed to a number of siblings and there is a family dispute as to ownership. Get your legal adviser to ascertain as soon as possible that such difficulties will not arise.
Check to ensure that the property actually matches its legal description. This is especially important in the case of older properties. A good geometra will be able to do this. Else you may end up with a property that is actually less than that in the description.
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