Property purchase guide

Getting on to the property ladder is an important choice: it means to get involved rationally and emotionally in a simple procedure that can suddendly turn into a nightmare. This is the reason why it is important to hire a professional you respect and trust who will help you to achieve your goals: the estate agent. We have the the knowledge and expertise of more than 20 years in this business to help you, along with other professionals, to solve problems that every negotiation presents.

Our approach always begins with an evaluation of customer needs, to focus on the right object within the budget available. We will search for suitable properties both in our database and through collaboration with other colleagues. We will than organise a viewing of the selected properties and we often recommend a second viewing, at different hours, to see all aspects that are not always evaluated at first glance, such as exposure, sun light or minor details that are also important for final decision.

Once we have found the right property, these are the steps to follow.

  1. Written Offer
    When you finally found the property you want to buy, the first step to follow is to formulate a written offer to the owner, in which you specify the amount of the offer and the methods of payment. The offer is valid usually 7 days; if the owner accepts your offer, he has to sign it within the expiry date. A written offer shows the owner that you are really interested in his property: it is accopanied by a cheque payble to the seller and deposited in the agent’s office who will keep it until the offer will expire. If the offer will be accepted, the seller will sign it for acceptance before collecting the cheque, which will become a legally bounding deposit. If the offer is rejected, the buyer will have the cheque back. The procedure is free and it is the only way to show the seller your real interest in the property. When the offer is signed from the seller, the following step is the preliminary contract It should be made clear that non Italian citizens are in no way treated any differently by the law than an Italian citizen. There are no special deals or taxes for non Italians. The main difference between taxes on the purchase of the property and the ongoing rates and council fees is determined by the owner's place of residence.
  2. Exchange of contracts (“Compromesso”)
    This a private contract between the buyer and the seller in which all the details of the final contract are laid out, all the terms and conditions, methods of payment, what taxes and extras are to be paid, dates for completion and any other details are discussed. We recommend that this be done with the assistance of a public Notary. Once this is signed, he will make a title search that there are no loans or other impediments and that the property is the exact one that is for sale and that all permits for the building are in order. In this contract, the full price being paid for the property is stated. At this stage all seller’s documents will be controlled: title deed (contract, inheritance, ect), urbanistic conformity, cadastral conformity, energy performance certificate, gas certificate. A deposit of usually 20% of the full price of the property is paid. This is not held in escrow but goes directly to the owner of the property. If the purchaser then defaults on the contract, they lose the deposit. If the seller defaults, they have to refund the full amount of the deposit plus an equal amount to the purchaser. This is called a "Caparra Confirmatoria". This makes the penalty for default an equal amount for both parties. Payment of the Real Estate Agency fee is also made at this point. The compromesso must be registered by the Notary: the cos twill be paied from the buyer and will be deducted from the total registration tax that will be paied at completion.,
  3. Completion (“contratto di acquisto”)
    The final contract has to be made in front of the Public Notary. This is the contract which is registered at the Land Register office (Ufficio Catastale and the Conservatoria dei Registri Immobiliari) and is the one that is recognized as the contract on which all government taxes and fees are calculated. After the signing of this contract there is a period of approximately three weeks before the new owners receive this document. This document is the equivalent of a Title Deed and is the document of ownership of the property. At the signing of this final contract the balance of the purchase price is paid to the seller. The Public Notary's fee is paid and the payments of the government purchase tax and registration fee are collected from the Notary.

In conclusion, the estate agent receive a commission from the seller and the buyer because he has the task of eliminating all the divergencies arising during the whole procedure by acting in the interest of both parties: try our services, we would love to work with you!

Government Purchase Tax

Each property in Italy has 2 values to be considered: A) land register office value ("valore catastale"), which is the value given to the property from the state, according to the year of construction of the house. Usually is much less than the market value of the house. B) market value, which is the value of the house on the market. Taxes are paied according to the land register value; notary and agency commission are paied according to the market value of the property.

There are 2 possibilities to follow when you buy a property: 1) to buy the property and declare it as your main residence ("agevolazione prima casa"); 2) to buy the property as a second house without being resident.

  1. If you register the property you purchase as your main place of residence it means that you will have to live in this property for more than six months and one day per year; the government purchase tax (imposta) will be 2% of the land register office value, that has to multiplied for a coefficient of 110, plus an extra 100 euro for other taxes;
  2. If you purchase the property as a second or holiday home then the purchase tax will be 9% of the land register office value, that has to be multiplied for a coefficient of 126, plus an extra 100 euro for other taxes.

If you declare that the property is your first place of residence you have to move your residence there within 18 months from the date of purchase. If you resell it before a period of five years, again a penalty will be charged for the difference between the 3% and the 10% you would have paid as a second home plus a fine of 30%. If you however purchase another property within a year as your place of residence, the penalty does not apply. If you resell the property after 5 years you will not have to pay any tax, even in case of capital gains.

Required Documents

Capitals Gains Tax

Capital Gains Tax has been abolished in Italy if you sell your property after five years of ownership. If you are not resident and you sell the property before five years you will pay capital gains tax on any profit.

Taxes to be paied on the property.

  1. Local council tax (IMU) based on the land register value multiplied per 160, but only if you are not resident; you will pay 0.96% per year of the result without deductions.
  2. Local rubbish collection tax (TARI e TASI), based on the square metres of the property.

In Italy, when you purchase a property you do not receive a certificate of Title of ownership. Your documentation of ownership is your purchase contract and this is held by the public notary.

In conclusion, the estate agent receive a commission from the seller and the buyer because he has the task of eliminating all the divergencies arising during the whole procedure by acting in the interest of both parties: try our services, we would love to work with you!