Italy » The Purchase Process

Buying real estate in Italy is a safe and not a very complex procedure. Apart from the higher registration tax the purchase process in Italy has the same rules for the foreigners as it does for its own citizens. A foreign national has to pay a 11% purchase registration tax and an Italian citizen must only pay a 4%. If the investor can get citizenship it can reduce the purchase cost of the property.

 

• When buying real estate in Italy the first task would be to select the property and quote a purchase price for an offer to be made. This proposal for Italian real estate purchase is made through the real estate agent.
• If the seller decides to accept the proposal, then the real estate buyer in Italy has to pay a deposit. The deposits are usually 10% but can be as high as up to 50%.
• The deposits in Italy are non-refundable. If the seller changes his mind to sell the property he has to pay double the amount of the deposit submitted by the buyer and if the buyer withdraws from the purchase deal in Italy he cannot have his deposit back. The only way a buyer can have the deposit back is if the seller is unable to get a clear title for the property for sale within the required time.
• The seller has to ensure that the title of the property is clear.
• The notary in Italy acts for both the vendor and the buyer. Before the signing of final deal he makes the necessary checks and inspections on the property that is being sold. He has to ensure that the title to the property is free and clear, it has no debts or mortgages etc. These inspections can take a period of two to three weeks. If any problems are detected then the sale of the property cannot be made.
• After the initial agreements the buyer and the seller sign a legally binding buying proposal (compromesso di vendita). This document has all the details of the purchase, including the completion date, purchase price.
• In the end both the seller and buyer sign the final contract (rogito) in front of the notary. The notary issues the deeds and informs the land registry to transfer ownership. The remainder of the balance should then be paid along with all taxes.

• Taking into account all the fees etc a buyer in Italy has to pay around 15% of the total purchase price.
• Stamp duty is usually between 10% and 17% depending on the location.
• 10% is paid for most properties that come under the urban category, whereas 17% is paid for rural properties.
• If you intend on moving to Italy permanently then you will be required to pay 4% stamp duty.
• VAT on new properties can be from 10% to 20% depending on whether the property is classed as luxury.
• If you build your own property you can get a 4% reduction in VAT.
• Estate agent fees are between 3% and 5%.
• Notary fees are normally 3%.
• Legal costs in Italy are typically 2% of the purchase price.
• Local taxes (ICI) are between 0.4% and 0.7%.