Once you are the owner of your new property there are a few obbligations you must fulfill within a fairly limited amount of time. They are:
- Register the change of ownership at your local police station within 48 hours. This is a hang-over from 1970's anti-terrorist legislation.
- Register your new residence, if this is the case, with the local town hall authorities comune
- Check with the comune or town hall what you will have to pay in property taxes. It will be based on the cadastral value of the property but local authorities set the percentyage. There are tax advantages if the property is registered as a main residence. The first month is owed by the person who owned the house for over 15 days of the month.
- Refuse tax or TARSU you must register with the competent office at your local authority to register the details of house size, number of people living there, etc before next January 20th after the purchase.
- Register changes to the utilities companies
Referred to in Italian as the Rogito, the deed of sale must contain all relevant information, conditions, etc. stipulated in the previous document, the compromesso, including the price upon which all taxes and notary fees will be based.
The Rogito is signed in front of the Notary Public who is there to represent both parties equally. As such, he is also paid by both parties on the basis of the value of the property. The Notary will read through the deed, which must be in Italian and where necessary translated by a court registered translator. It is customary for the parties to be accompanied by their legal representatives for the stipulation of the Rogito. At the signing of the Rogito, ownership, together with the keys to the property of are transferred to the buyer and the remaining price, less any deposits paid at aerlier stages in the process, is paid to the seller (normally a bankers draft is used for this, assegno circolare in Italian. All taxes will also be paid through the notary at this point.
In the final step, the notary public must register the property under your name at the cadastral registry within 20 days.
Congratulations, you've just bought yourself a home!
The pre-sale contract
Pre-sales Contract or Compromesso:
The compromesso is basically a formalisation of the offer with a somewhat stricter legal framework. The Compromesso is, in essence, a private contract and will usually be signed in front of the estate agent. It is possible to register the compromesso by signing it in front of a notary public. This will have costs attached but in some cases may be worth the expense as it provides added protection in certain cases such bankruptcy on the part of the seller (company, not individual). The vast majority of compromessi, however, are signed as private contracts.
It is important that all documentation on the property has been viewed before this point in the process. The pre-sales contract will normally be drawn up by the estate agent on the basis of existing templates so it is important that all conditions you wish to place on the purchase (reparations to be carried out, provision of any missing documentation, etc) are clearly included in the document. You may want to have an Italian lawyer check the document to ensure that there are no misunderstandings. As a minimum the compromesso should include the following elements:
- Identities of buyer and seller
- The sales price, the deposit, and the modalities for payment of the full price
- The exact description of the property. At this stage it is important that all legal parts of the building are included in the description. If there are any additions, extensions, etc which have not been approved, they cannot be included in the description or the sale may be subsequently deemed to be invalid. On the other hand, any parts of the property not legally endorsed by the relevant authorities become the responsibility of the buyer once the sale has gone through. You might find that you have problems getting a subsequent buyer to accept the situation, future town council administrations may insist on the demolition of any illegal parts at some time in the future or you may live happily ever after in semi-legality.
- Specific acknowledgement of conformity with all regulations and building codes.
- Guarantee of the absence of third party rights to the property or of any undisclosed encumbrances.
- A firm date by which a formal sale will be carried out
A deposit is normally paid at this point, which is not fixed but usually ranges between 10 and 30 percent of the sales price. If this deposit is considered a binding deposit, the term in Italian law is caparra confirmatoria, then a failure to purchase on the part of the buyer will result in the loss of the entire deposit. Should the seller fail to sell for whatever reason, the buyer is entitled to double the deposit from the seller. The buyer can also ask a judge to force the sale or award compensation. A caparra penitenziale, which is far less common, defines specific terms under which the deposit can be refunded.
It is worth noting that the price declared on the property at this stage is used as a basis for the assessment of any taxes or land registry charges.
It is worth having a discussion with your tax attourney as to whether it is better to purchase property in Italy as an individual or whether it might be more efficient to buy through an existing company or a newly constituted Italian company. For more on this and other elements visit the IDH blog.
It is not essential to sign a compromesso. Though unusual, parties can proceed straight to the sales contract or Rogito.
Checking your property
Some of Italy’s property laws can seem surprising to foreigners and it is crucial that you make yourself fully aware of them before proceeding with the first phase of a purchase known as the compromesso or preliminary contract . Here are the main potential pitfalls
Rural land rights:
If you are buying agricultural property and if the land neighbouring the property you are interested in is owned by someone registered as an agricultural producer, they have the right to purchase the land at the same conditions agreed between you and the seller. This right can be invoked even after the sale has gone through, which would invalidate your purchase. For this reason, it is very important that the land is offered to the neighbour and that he formally declines to buy it in writing. You should ask to see proof of this.
Deed of title:
Italian inheritance laws often lead to a property having multiple owners, It is important that these owners are known to the estate agent and that each of them has signed off on the sale.
Land registry documents:
properties must be accurately described in the land registry or Catasto. Make sure that these documents are recent and that they are an accurate description of the property.
The legal state of the buildings:
Italy has used a practice of what are called condoni or amnesties which basically legalise illegal building work. The conditions which need to be met in order to apply for one are quite complicated and they can take many years to come through. It is important to make sure that any amnesties that have been applied for on the property have been fully granted by the authorities. Failure to do so could invalidate the sale. If the contract you are presented with does not include a part of the house or annexes, treat this as a red flag.
Finding your property
The Italian property market is still surprisingly local in nature and many properties are in the hands of small local estate agents with limited possibilities to advertise their properties to an overseas market. That said, there are several national franchises grouping agencies together and websites bringing sellers and buyers into direct contact are also beginning to develop here as they have elsewhere. Some estate agents will also offer personalised property search services.
The role of Italydreamhomes.com
Italydreamhomes advertises homes on behalf of estate agents. We are a referral service and not an estate agents ourselves. We receive payment from estate agents only and not from prospective home buyers using our service, although we do offer ancillary services such as interpreters and help with logistical arrangements in return for a fee. It is important to note that we personally visit each property on our website and that all photographic and video material on the site are produced independently by Italy Dream Homes. The main concept behind our approach is transparency. We aim to provide as much material as possible for you to make a reliable shortlist for your property visits when you come to Italy to view.
The role of the Estate Agent
An estate agent in Italy generally works for both buyer and seller. They will receive commission from both and are therefore obliged to protect the interests of both buyer and seller. Italian law requires estate agents to be registered by their regional chamber of commerce and they must hold a certificate to this effect as well as insurance covering professional negligence. It is unwise to deal with anyone who does not hold these pre-requisites.
Italian law defines the role of the estate agent as being: “to communicate to the parties all circumstances known to him which can effect the valuation and the security of the deal or which may effect the conclusion of the deal.” The agent should also make sure that all relevant facts are known to him by carrying out the necessary searches on a property but ultimate the responsibility falls on the buyer themselves. The agent will transmit the buyers offer to the seller and mediate between the two, ensuring that the correct documentation is signed in order to be able to proceed to a sale. The estate agent can also hold guarantee payments and downpayments to ensure trust between the parties.
Commissions vary between 3 and 8 percent, depending on the price of the property in question, and are normally shared equally between buyer and seller. Some agents will require payment at the preliminary agreement phase, check to ensure that this is refundable should the final sale not go through.