This is the latest directly from the founding broker, who is by the way a former banker right in the immediate area. He knows the ropes and this is straight from him in his own words. As you can see, his English is bulletproof.
Purchase process
Buying a property is different from country to country. We hope this short explanation will help you to understand things better about the process in Italy.
CHOOSE A PROPERTY
Find the right house in the right place.
MAKE AN OFFER
If you have the possibility you can complete an offer from where you’ll describe the amount of the offer, the conditions, when you’ll pay the deposit and the date of the Final Contract. If the offer is not accepted, you’ll have your deposit back.
PRELIMINARY CONTRACT/AGREEMENT
Written in both Italian and English, it is a private agreement between the purchaser and seller. This document should be prepared by a professional (estate agency) and it will define the selling conditions such as… all the exact details of the property, rights of way, payments, time of possession, guarantee by the seller by the lack of mortgages. Usually, when signing the preliminary contract, the purchaser will pay a deposit of about 20% of the established amount but this can be discussed then according to your needs. If the sellers pull out after the preliminary is signed they have to pay you the double of your deposit. If you pull out, you’ll lose your money. This protected the purchaser from the seller selling to another bidder. Between the preliminary agreement and Final Contract in front the Notary, we consider a wait of one to three months (depends on the complexity). This time will be used to prepare all the documents. Note that sometimes it is possible to skip the preliminary and just do the Final Contract.
OBTAIN THE “CODICE FISCALE”
Italian tax code available from the tax office. You need one to buy a property in Italy and to open a Bank account and it is completely free. That’s important and essential to have a codice fiscale and an Italian Bank account to do the Final Contract. We will do that for you.
OPEN A BANK ACCOUNT
You’ll need to open one because it will be necessary to transfer funds to your Italian bank account before signing the Final Contract. Please let your bank know that all expenses have to be paid by the sender (you) and make sure the correct and full amount will arrive into the account of who should receive the money. Then the Bank will prepare you for the Final Contract cheques (assegni circolari) you need to pay over to the seller.
FINAL CONTRACT
We sign it in front of a Notary, the professional authority to execute legal sale. The Notary has to control and guarantee the property clear title and take care of any other problem pertinent to the property. The sale taxes are paid by the buyer and the amount will depend on the declared price. You need to be present to sign the documents in front of the Notary and if you don’t speak fluent Italian you’ll be assisted by a qualified translator and you’ll have the Power of Attorney in your language. At the closing you’ll have to pay the balance of the transaction, the notary, the taxes and whatever expense is required to complete the contract. Taxes are paid on the declared value.
SERVICES
We offer all international clients a full, English-speaking advisory service. We endeavour to assist and advise you every step of the way with the purchase of your Italian property. All the services listed below are included within the 3% agency commission charged to all clients. Please note, contrary to estate agency procedure in the UK or USA, Italian estate agencies charge commission to both the vendor and the purchaser.
- Fixing appointments for viewing
- Italian-English translator present at all property viewing and at all meetings prior to and during the purchase process.
- Full explanation in English of Italian real estate processes
- Establishing contact with the vendor
- Assisting with negotiations with the vendor
- All documentation and contracts prepared in Italian and English
- Assistance obtaining an Italian tax code from the tax office in Perugia
- Assistance opening an Italian Bank account
- Assistance applying for an Italian mortgage
- Present at signing of final contract at Notary’s office
- Coordination of all tax issues
- Coordination of local authority requirements
- Assistance and coordination of accounts and payments to water, electricity and gas boards and telephone company
- Advice on where to stay locally while you are house-hunting/buying your property
- Introductions to local builders, electricians, plumbers etc etc
FEES
When purchasing a property in Italy you will be required to pay fees to the Notary and the Estate Agency and tax on the price of the property. These fees are listed and explained below.
TAXES
In Italy each property has a sale price ( that which is paid to the vendor) and a declared value. The declared value is registered at the “catasto” ( land registry certificate) and this registration process is called the “visura catastale”. Please note that the declared value tends to be lower than paid to the vendor. Taxes are however only paid on the declared value.
IF YOU ARE PLANNING TO COME AND LIVE IN ITALY PERMANENTLY
If this is the case and you do not own another property in Italy you can apply for Italian residency. If you are a resident or are planning to apply for residency within 18 months of signing the final contract you will be required to pay the “Imposta di Registro”, this is a tax of 3% of the declared value of the property, plus € 180. This tax is increased to 4% if you are acquiring the property from a Company rather than from a private vendor.
IF YOUR ITALIAN HOUSE IS TO BE A HOLIDAY HOME
If so, you’ll be required to pay the “Imposta di Registro”, this is a tax of 10% of the declared value of the property. The “Imposta di Registro” tax is 18% on agricultural land. If you buy a property as your first home, then do not apply for Italian residency you will be required to pay a further 7% on the declared value as well as a fine. We are happy to discuss and advise on all residency and tax related issues.
NOTARY FEES
Notary fees vary according to the declared price of the property and the chosen notary. If you are not a fluent Italian speaker you will be required to pay for a Power of Attorney for the signing of the final contract. If you are taking out an Italian loan or mortgage to purchase a property in Italy you will have to pay for the “atto di mutuo”, this is the contract between you and the bank which has to be registered by a notary.
AGENCY FEES
In Italy both the vendor and the purchase pay commission to the Agency. We charge the 3% commission to clients. 20% IVA has to be paid on this commission. We are happy to request a full estimate of fees from a notary prior to signing the preliminary contract.
ONCE YOU OWN THE PROPERTY
The following utility bills will need to be paid, prices are calculated according to consumption.
- Electricity (every 2 months)
- Gas (every 2 months)
- Telephone (every 2 months)
- Water (approx 3 times per year)
- Rubbish tax (annually)
- ICI is the Council tax that will need to be paid on the property twice a year, in June and December
MANAGEMENT
In case you need we manage property too, with a regular contract. If you’d like the assistant broker can manage your property in Italy.