Buying property in Italy
It sounds more daunting than it is. We did it --so how hard can it be? We thought you might find it helpful to see how it works. Here's a guide to buying your home in Italy, Italian-style. Remember, we're not lawyers. Nothing on this site is intended as legal advice.
- Viewing the property. Definitely the fun part, whether it's a hilltop castle or rustic farmhouse with drop-dead views.
- Make a down payment.. So you like it. You've found the Italian home of your dreams. A deposit of 1500-5000 Euro puts you in play -- refundable only if the vendor decides not to sell or if there are technical problems.
- Documents, please. You need is a passport and, for married women, copies of birth/wedding certificate
with your maiden name. (Under Italian law purchases such as cars and houses
are always in a woman's maiden name.) These documents let you apply to your
'Codice Fiscale' -- your Italian tax number. You also get a smart 'codice fiscale'
card that comes in handy when you least expect it. The buyers who have had
the easiest time doing this have dont it at thir local consulate in the U.S.
in person. That seemed to be the key to their success , being their in person.
They left the office with their code fiscale numbers. For example, any situation
that would require your social security number here, like opening your Italian
bank account. (Yes, you should have one. More about that later : See section
BANKING below)
Specific documents for mortgage
To get a mortgage, you need to produce copies of the last two years Income Revenue Forms, your passport (all documents are in the name you were born with) and reference from your Bank to the bank where you'll open the account (they will go directly from bank to bank). You could take with you a few thousand euros/dollars in case you decide to buy in order to pay an initial deposit to secure the property. - Proposal to purchase. The vendor agrees to sell, you're ready to buy. A 'Proposal to Purchase' is drafted and signed by both buyer and seller. You make a deposit of 20-30%, plus commissions and taxes. If you make this deposit and the seller accepts it, you're pretty much all set. That's because, if the owner gets cold feet after this point and decides not to sell, our understanding is that they have to pay back double the amount that you paid them. Whatever the case may be legally, the sellers seem to regard this transaction very seriously. After this point, the deal "almost always" happens.
- Next. The notary checks the title, the surveyor parcels the land if it's part of a bigger estate.
- The closing. Typically 2-4 months after the Proposal to Purchase. You may attend the closing and, if you don't speak Italian, the deed will be translated. Or you may send a power of attorney notarised by an Italian consulate near you along with the balance of the purchase price.
- Closing costs. Each property has a 'statutory value,' which is usually much lower than the real value -- historically as much as 50% less. (but this is changing as the Italian government trys to move to a more logical and less mysterious way of doing mortgages. Their goal is surely to have all the numbers line up so to speak) At the closing, you'll pay 10% of the statutory value as a registration tax. If you plan to be a full-time resident within 18 months, you may declare your purchase as a 'prima casa' -- first house -- and pay just 3%. Your only additional cost is approximately 700-1500 Euro to the notary for deed preparation.
- After the purchase. Planning to restore? Now you have to work with the surveyor/architect/contractor of your choice. Anything is possible. But allow time, money and potential hassels just like any home project, but this one is often an ocean and a language removed from what you are use to.
- Annual taxes. Property taxes are quite low right now in Italy. Your broker may be able to give you an idea of what this means for the property you're interested in. We were pleasantly surprised. There are also small local taxes and services to pay to the "commune" where a property is located. We have our local bank automatically pay ours from our checking account.
- Services. Water is typically billed twice a year, electricity and telephone every other month. These, plus gas and refuse collection can also be paid directly at the post office or through a standing order at the bank.
- Banking. Have Pavarotti be your spokesman. We have actually found all bills 'molto facile' to pay with our own Italian bank account. We love it that our bank (founded incredibly, about the time Columbus was discovering America) features Pavarotti himself in its commercials! Your broker may be able to help but remember at the end of the day it has to be your decision and one that you are comfortable with.
- Mortgages. Mortgages as we know them, are "relatively new" things in Italy. They are now fairly common and not unlike getting a mortgage in the US. They say you can thank Italy's entrance to the EU for that.
- See you in Italy? Web surfing is fine, but it pales in comparison with being there in person. Drop us an email and we'll set up some property viewings right on the ground in Sunny Italy. Lot more fun than looking at some silly web site on your computer screen!