Buying Guide Italian Luxury Asset

The Process of Buying Property in Italy

We know that sometimes, buying a property in Italy may seem quite complicated, since you don’t know the Italian bureaucracy and the steps to follow. That’s why we want to give you some tips, so that you know what to do and what steps to follow, during the purchase process.

Buying a property in Italy is actually pretty straightforward:

First of all, make sure that what you are going to buy is what you really like. Once this point is clear, you just have to make an offer, stating the price you are prepared to pay.
The buying process starts with a “proposta d’acquisto”, a brief contract with your offer addressed to the owner for the property.

The preliminary contract

If the seller accepts your offer, the deal becomes binding on both parties and you go through a preliminary contract, “Contratto Preliminare di Vendita” or “Compromesso”, which defines all selling conditions such as a description of the property, the sale price, payments and timing, ownership rights and any other relevant clauses . On signing this contract, the purchaser pays a deposit of approximately 20% of the property price, depending on what has been agreed. In the event that you decide not to pursue the purchase, the compromesso will be forfeited or the seller may seek legal action to enforce the purchase. On the other hand, if the seller backs out, he will be liable to pay double the amount you have given as deposit.

At this point, a notary (notaio) is appointed, the independent legal body that prepares and coordinates the searches and deeds, acting on behalf of the vendor and purchaser.

The Deed of Sale – “Rogito”

The final contract (“atto” or “rogito”) is signed at the notary’s office. The “notaio” or notary has the responsibility of performing due diligence. Whether he is chosen by the seller or the buyer, he acts for both parties. When the checks are done and you feel everything is clear enough for you, you can pay the final balance and sign the deed of sale (witnessed by the notaio). This requires you to present a valid identification document, and your tax code (“codice fiscale”), which can be obtained through the Italian consulate in your Country, or at the Tax Office (“Agenzia delle Entrate”) in Italy. The notary will issue you a copy of the deed and present copies to the tax office and Land Registry. Purchase taxes and notary fees are paid by the buyer at the signing. Once all documentation is signed and all monies paid, you will finally receive the keys to your new Italian property.

Taxes on the Purchase

On the purchase of a property there is a registration tax (“imposta di registro”) or alternatively VAT (depending if the seller is a private or a registered company) as well as the Cadastral and Land Registry taxes (“imposte Ipotecarie e Catastali”). The payment of such taxes is naturally at the expense of the buyer.

If this is your main Italian home and you take Italian residency (“prima casa”) and the seller is a private:

• Registration Tax: 2%
• Fixed Land Registry tax: € 50.00
• Fixed Cadastral tax: about € 50.00

If the property is registered as a Luxury Property (Cadastral categories A/1, A/8 and A/9), the Registration Tax is 9% When the seller has a VAT number and operates in the construction industry, and you buy within 4 years after the conclusion of the works, the following must be paid on the purchase price indicated in the purchase deed:

• VAT: 4%
• Fixed Registration tax: € 200.00
• Fixed Land Registry tax: € 200.00
• Fixed Cadastral tax: € 200.00

When the seller has a VAT number and does not operates in the construction/renovation industry, or you buy froma construction/renovation company after 4 years after the conclusion of the works, the following must be paid on the purchase price indicated in the purchase deed:

• VAT: NOT to be paid
• Registration Tax: 2%
• Fixed Land Registry tax: € 50.00
• Fixed Cadastral tax: € 50.00

If this is NOT your main Italian home and the seller is a private or a company, which does not operate in the construction/renovation company, or you buy 4 years after the conclusion of the works:

• Registration Tax: 9%
• Land Registry tax: € 50,00
• Cadastral tax: € 50,00

If this is NOT your main Italian home and the seller is construction/renovation company and you buy within 4 years after the conclusion of the works:

• VAT: 10% (22% for luxury homes)
• Fixed Registration tax: € 200.00
• Fixed Land Registry tax: € 200.00
• Fixed Cadastral tax: € 200.00

The Registration Tax, Land Registry tax and the Cadastral Tax are paid by the Notary, when registering the deed. This means that the Registration Tax, Land Registry tax and the Cadastral Tax are included in the Notary fees, which are about 1/2,5% of the declared value of the property.

Agent´s Fee

The standard agency fee, regardless of the type of property (commercial, residential, or land sales), is about 3%. The agency fee is payable at the signing of the preliminary contract.

Mortgages

Once you have found a property you may consider taking out a euro mortgage to help finance your purchase. The general rule in Italy is that you can borrow up to 80% of the purchase price while your total mortgage payments and other commitments must not exceed approximately 35% of your gross income. A variety of mortgage products are offered and the opening of an Italian bank account is compulsory.

Buying a property in Italy can be easy and fast, if you ask for support to reliable people. We, at Italian Luxury Asset, can help and assist you during the whole process, from the property viewing, to the notary deed, to the activation of domestic services and any other need you may have in order to step into your new house in complete ease.

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