How We Can Help You
We practice both residential and commercial real estate law. This page is about residential real estate. For the commercial practice please click here.
Are you buying real estate in Italy?
Do you already have property in Italy and are currently dealing with property managements issues or your neighbours?
Are you selling your property and you would like to be legally protected?
You are renovating your property and you came into problems with the contractors?
Do you need to discuss with your bank regarding your mortgage?
Are you having problems with your lease agreement? Is your tenant behaving illegally?
We are able to assist in all real estate related matters in Italy allowing you to receive bespoke legal advice and step-by-step assistance in this area. We work with both individuals and companies and are qualified to defend and represent you in front of all Italian courts.
Buying a Property in Italy
Buying a property in Italy is the life dream of many foreigners, who want to enjoy the beauties of the “Bel Paese”. The demand from foreign clients, especially Americans, has been increasing in recent years, which means that the Italian real estate market still manages to be very attractive.
However, the path is not clear cut and may have some pitfalls. After all, purchasing a property is always a major commitment, and even more when it is in a foreign country.
In order to complete the negotiation smoothly and and to enhance the chances of concluding the sale, here is some key information you should know about the overall process of buying a house in Italy as a foreigner.
Let’s start from a simple question: can foreigners buy real estate in Italy? The answer is YES, but under certain conditions. In particular, a foreign citizen is allowed to purchase a property in Italy in the following cases:
- EU citizen: always allowed, without any limits;
- Non-EU citizen: only if an international treaty allows it or whether there is reciprocity (i.e. whether an Italian citizen is allowed to buy a house in the foreigner’s country of origin – check here to know more. If this is not the case, a non-EU citizen is allowed to buy a property in Italy only if they hold a resident permit.
Deciding which property to buy is not just a matter of identifying the type and the place where it is located; in addition to a purely aesthetic choice, it is also very important to check all the technical and legal aspects related to the property itself, such as the compliance with urbanisation standards, the conformity of the energetic systems, the absence of legal constraints whatsoever, etc.
What Do I Need to Check Before Buying a Property in Italy?
To avoid unpleasant surprises, we strongly recommend that you undertake a few checks before signing a binding contract to purchase real estate in Italy:
- the act of origin of the property hence how the property was acquired by the seller in the first place. For example, if the property was gifted to the seller or they received it as an inheritance, it is necessary to undertake further investigations;
- if the property was not built regularly, check that the owner has submitted an application for a building amnesty (i.e. condono edilizio) and that he has been granted a permit by the competent Town Hall further to that;
- “visure” or mortgage inspections: you can request these from the real estate register, by using the seller’s personal details, to verify the absence of mortgages, foreclosures, judicial actions or other legal constraints. It is essential that the seller is the only owner of the property;
- if the seller is a company, always check its “state of health”: indeed, it might turn to be not very solid over time from a financial point of view and therefore endanger everything through bankruptcy;
- the conformity of the property as for all the relevant authorisations (i.e. the urban planning standards, energetic systems, etc.).
In the case of buying an apartment within a complex, it is advisable to carry out further investigations:
- property management regulations: it is important these are checked because they can contain bans and limits on the use of private parts;
- latest assembly resolutions: it is possible that there are prejudicial assembly resolutions like judicial litigation;
- contact the property manager: it is essential to check if the seller is in good standing with the payment of condominium expenses because the buyer who takes over the property becomes jointly and severally liable with the seller.
If you wish to know more about real estate management, click here.
Procedure to Be Followed When Purchasing Real Estate in Italy
FIRST STEP: The Formal Offer of Purchase
After visiting different properties and deciding which of those you wish to buy, you must make a formal offer of purchase (i.e. proposta di acquisto). This offer is what initiates the phase of negotiation. There are many aspects to check and many risks that should be mitigated during the negotiation phase, and the assistance of a lawyer is certainly advisable.
The formal offer of purchase is the way the buyer declares that they want to buy a given property at a given price. Usually, it is a pre-printed form provided by the real estate agency. A deposit, the amount of which is set in proportion to the value of the property, is also to be paid by the buyer upon the signature.
The seller is free to evaluate other proposals as long as the purchase offer is effective. The recommended duration for it is one or two weeks, during which the seller can accept and reject it. In case of acceptance, then the agreement is binding. It means that the seller undertakes not to sell the property to anybody else but you for a certain period of time, during which you do not lose the opportunity to buy that property. However, if you change your mind, you lose the amount you paid as a deposit.
The formal offer of purchase must not be confused with the preliminary agreement of purchase, which is an optional step the parties may decide to take during the process of buying a property in Italy and that is briefly explained below.
SECOND STEP: The Preliminary Agreement of Purchase
This second step is not necessary but it is often taken. You exchange the preliminary agreement of purchase (i.e. contratto preliminare di compravendita, also known as “compromesso”). This is a legally binding contract which is basically aimed at obliging the contracting parties to undertake a reciprocal commitment to buy and sell. It must be in writing and it must report, amongst other things, the agreed sale price, the payment schedule, with all deadlines, the date of purchase completion and any useful information regarding the property itself.
A deposit (i.e. caparra confirmatoria) ranging between 10% and 30% of the sale price of the property must be paid by the buyer upon signing the preliminary agreement of purchase; in the event of the unfulfillment of the contract by either of the parties, the deposit stands as a warranty. In particular, in the case of failing the sale on the agreed terms, the buyer will automatically lose the whole of the deposit paid. On the opposite, if the seller is to blame, they will be legally obliged to pay to the buyer twice over the sum originally received as a deposit.
Should a real estate agent has been appointed, the buyer is required to pay a mediation fee, which varies from 2% to 3% of the purchase price, plus VAT and ancillary fees. It should be noted that the percentage is to be considered as a minimum and that several agencies may ask for a higher one. The mediation fee is to be paid upon the signature of the preliminary agreement of purchase.
IMPORTANT: if you are going to buy the property with the assistance of a mortgage or if the property itself is subject to a mortgage, it is essential to deal with all the banking and legal arrangements before you sign the contract hence you commit yourself to make the purchase. Click here to find further information on this.
THIRD STEP: The Deed of Purchase and Completion Formalities
The deed of purchase (i.e. rogito di compravendita) is the final act. Upon signing it, the property is finally transferred from the seller to the buyer. Very specific obligations arise from it, and precisely:
- for the buyer, to pay the agreed sale price;
- for the seller, to deliver the property and to ensure that it does not suffer from evictions, defects and faults.
The deed of purchase must report, among other things:
- the personal information of the seller and the buyer (i.e. name, surname, date and place of birth, residence address, tax ID);
- the information regarding the building (i.e. cadastral details, year of construction, town planning compliance, habitability, economic value);
- the information regarding the presence of any pledges or mortgages the property may be subject to;
- the agreed sale price and the method of payment, as well as all the relevant deadlines;
- the expenses the buyer has already incurred in (e.g. the deposit).
The deed of purchase must be signed by both the contracting parties in presence of a Notary Public, who ensures, as an impartial and third party, that the transaction complies with the law. A certified copy is then issued and registered with the Local Land Registry (i.e. Catasto Urbano).
The registration is a form of publicity and has multiple functions. First of all, it makes the transfer of ownership of a given property known to everyone hence opposable to third parties: the so-called “registration priority” (i.e. priorità di trascrizione) allows to solve conflicts between several potential buyers of the same property sold by the same seller. Second of all, it provides “the public” with an overview of the events concerning the real estate. The registration is, therefore, an extremely important task which the Notary Public must carry out promptly and for which they may be held accountable.
If you are looking for a real estate lawyer, from us you can receive professional assistance throughout the entire process of buying a property in Italy, so do not hesitate to contact us.