Owning a property in Italy has become very popular due to the high number of investment opportunities that its real estate market offers. Consequently, the Italian government has introduced new policies regarding tax deductions and state incentives in order to support this positive trend. Drawing from this, this article will provide you with a detailed overview of the incentives which are available when you purchase your first home in Italy, and the requirements you need to meet in order to benefit from these.

If you are buying your first house in Italy and you intend to move your residency there you can benefit from a number of tax deductions which include:

  • Reduction of VAT from 10% to 4%. Furthermore, people who purchase a house directly from the building firm only have to pay a fixed amount of €600 for registration, mortgage and cadastral taxes;
  • Reduction of registration tax from 9% to 2%: people who purchase a property from a private seller can benefit from a 7% discount on registration tax. Please note that the percentage is calculated on the cadastral value of the property and not on the actual purchasing price;
  • A reduced amount of €50 for fixed mortgage and cadastral taxes respectively;
  • Tax credit: if you sell your first house within 12 months from the date you purchase your new property you can benefit from a reduction of your tax credit. In other words, you can deduct the amount of tax you already paid when you purchased your previous house from the total amount due.

You can qualify for a tax deduction if you fall into one of the following categories:

  • you are an Italian citizen, you are purchasing your first house in Italy and you are moving your residency there;
  • you are not an Italian citizen but you reside in Italy and the house you are buying will become your primary place of residence;
  • you are an Italian citizen living abroad, you are registered with the AIRE and you are purchasing your first house in Italy even if you will not move your residency there. If you fall into this category you will need to provide the certificate of registration with the AIRE or a self-declaration to prove your status as an Italian citizen living abroad;
  • you are buying your second house in Italy which will become your primary place of residence and you will sell your first house within one year from purchasing your second house. The commitment to sell your property must be stated in the purchase deed. If you do not fulfil your commitment you will not be eligible for the tax deduction and you will be required to pay a penalty fee.

The main requirement to obtain the tax breaks is that you do not own another house in Italy for which you already obtained a tax deduction. If you do, you will need to sell it within one year from the date you purchase your new house. Furthermore, you cannot benefit from the tax deduction on your first house if you already own a property in the same municipality where you intend to buy the new property. However, in order to obtain the tax deduction, you must be a resident in the municipality where the property you are purchasing is located. If you reside in a different municipality, you will need to update your residency within 18 months from the date you purchase your property, and the purchase deed must include a declaration stating your intention to move your residency. In order to establish your residency in a municipality you will need to go to the Town Hall to submit the required paperwork and the Local Police will verify that you live in the property where you intend to establish residency. If you move your residency after the 18 months this could be classified as tax avoidance and you may lose your right to tax benefits.

Finally, if you are under 36 years old and your ISEE (Equivalent Economic Situation Indicator) does not exceed €40,000 per year, you will fall into the “young people” category and you will benefit from additional deductions; in particular you will receive tax credit equal to the VAT paid to the seller which can be used to receive a reduction in the amount paid for registration, mortgage and cadastral taxes on your first house.  The tax credit can also be used to benefit from an exemption from paying the substitute tax on the loans granted for the purchase, construction and renovation of the property you buy for residential use. Please note that the benefits linked to purchasing your first house in Italy are valid until December 31, 2022.

In conclusion, if you are planning on purchasing your first home in Italy there are a number of requirements you need to meet in order to benefit from tax deductions. In this sense, it is important to have a good understanding of the legal and bureaucratic requirements to purchase a property. If you are planning on purchasing a property in Italy and you are seeking advice, do not hesitate to contact our team of real estate professionals who would be glad to assist you throughout the process. Feel free to contact us at info@italianrealestatelawyers.com.

 

Many of our articles have described the requirements to purchase a property in Italy as a foreigner, which has become very popular in recent years due to an attractive real estate market which offers a wide range of properties at very competitive prices. This article instead will provide you with a detailed overview of the three main steps which need to be accomplished after you buy the property of your dreams in order to ensure that all legal and bureaucratic requirements are fulfilled.

  1. Setting up utilities

 The first thing you need to do after you purchase your property is to set up utilities (i.e. gas, water, electricity and TV license). In order to do this, you need a valid Italian Tax Code. The most straightforward process to set up utilities in your name is to do what Italians refer to as voltura (bill transfer). This consists of changing the account holder’s name on the bills without suspending the service. Although the cost for the name change may vary depending on the company, it usually involves a one-off payment of €23.00, €25.51 for administration costs, a stamp duty of €16.00, VAT which adds up to 22% on the amount due, and an optional security deposit.

On the other hand, if utilities are deactivated, you need to proceed with what is known as subentro to install water, electricity, gas and television and start a new contract. Please be aware that you also need to consider the activation costs which may vary among suppliers depending on where the property is located. Once your new accounts have been activated, you will receive your utility bills by mail or email every other month and you can remit the payment online or at a local post office. If you use the online bill service to pay utility bills you can get a reduced rate. The meter readings will take place once or twice a year and your bills will be adjusted to reflect use. Utilities in Italy include:

  • Electricity: the average household spending for electricity is approximately €50 per month; however, this varies depending on the specific provider.
  • Water: the average household spending for water is €26 per month. In this case, the monthly expense may vary depending on where the property is located.
  • Gas: the cost for gas mainly depends on the area in Italy where the property is located. Since Italy has different climates, gas providers have established 6 payment zones. Monthly expenses for gas also depend on the efficiency of the property’s heating system and house insulation.
  • Television: if you have a TV in your house, you need to pay €90 per year regardless of whether or not you turn the device on. The payment for this tax is usually divided into 10 installments and these are included in the electricity bills from January to October.
  1. Paying local taxes

 Other expenses related to a property include the following taxes:

  • IMU (municipal property tax): you need to pay this tax every year unless you are eligible for a tax exemption. The Italian law allows for exemption if the property is the owner’s place of residence. Tenants do not need to pay this tax because it is paid by the owner. The amount is calculated based on the cadastral value of the property.
  • TARI (municipal solid waste tax): you must pay this tax every year. Unlike IMU, TARI is paid by the tenant. The rate is determined by the surface area of the house and it is proportionate to the average quantity of waste produced per unit of surface area.

The application forms to pay local taxes can be found on the Municipality’s website.

  1. Setting up an internet connection and other services
  • Internet: Italians spend on average €30 per month for their internet connection. There are several providers which offer good internet access services. The two main data transmission technologies to connect to the Internet are ADSL and fiber-optic. ADSL connection can offer a maximum download speed of 20 Mega whereas the fiber can reach a download speed of 1000 Mega. ADSL is usually cheaper than fiber and its coverage is widespread. On the other hand, fiber is mostly found in medium to large cities only.
  • Boiler maintenance: boilers need to be cleaned periodically to maintain their efficiency and to limit their consumption. By law, checks need to be carried out periodically by a qualified technician. The average cost is between €50 and €100 per maintenance check.
  • Home insurance: this usually covers fire accidents, theft or other incidents. There are different types of home insurance policies with different “coverage packages” that can be integrated. Please be aware that insurance companies usually require their clients to be residents of an EU member state in order to offer them a house insurance policy.

It is worth mentioning that language barriers may present challenges when you start looking into the aforementioned procedures because the paperwork is entirely written in Italian. Therefore, if you do not speak Italian we suggest you contact international real estate specialists who are fluent in English and who can help you set up utilities and pay taxes. 

If you need further information do not hesitate to contact our international real estate consultants at info@italianrealestatelawyers.com . We will be happy to assist you.

Buying a property in Italy might seem an intricate process especially if you do not live in Italy and you do not speak the language. This article will draw from our previous articles in which we analyzed the process of selling and buying a property in Italy and it will address specifically some of the most frequently asked questions regarding the purchasing process. If your question is not listed below please do not hesitate to contact us.

Q.1 You would like to check which properties are on sale in a specific area or you wish to buy a specific type of property. Is there a registry or an online database you can check to see which properties are on sale?

In Italy there are real estate agencies and other commercial companies which list available properties around the country. However, their websites may not always be updated and if you need more detailed information and you do not speak Italian house hunting may become rather challenging. We at Italian Real Estate Lawyers can help you find the property which best suits your needs. We work with a network of professionals based all over Italy and we can offer a wide range of properties that are available in all regions in Italy. We carry out extensive research, we take into account our clients’ preferences and requirements such as location, number of rooms and budget in order to ensure that we find the property that best suits our clients’ needs. We also make sure that the purchasing process is transparent and safe from a legal perspective.

Q.2 You would like to buy a plot of land to build your own property. Is this allowed in Italy?

The Italian Government determines the designation of every plot of land in the country. Some areas are intended for agricultural purposes only and therefore building is not allowed. In other words, some areas might be subject to restrictions. For example, you may not be able to build a multi-storey house in a rural area and some areas might even be part of regional natural parks, and therefore the limitations might even be stricter. In other words, prior to purchasing a plot of land, it is always advisable to enquire about building permits and restrictions.

Q.3 You would like to buy a property in Italy but you do not speak Italian. How difficult will it be to purchase a property?

Although speaking Italian is not a legal requirement to purchase a property, if you are interested in buying a property in Italy, having basic knowledge of the language might facilitate the process. In fact, it is possible to make a formal offer or sign a preliminary contract in English, but by law, the Final Contract of Sale must be in Italian. If you do not speak Italian, you will need an interpreter or an Italian professional consultant. If you cannot travel to Italy to sign important legal documents or the Final Contract of Sale, you can allow another person to sign on your behalf by signing a Power of Attorney. We at Italian Real Estate Lawyers can help you throughout the purchasing process and we can also sign the Final Contract of Sale on your behalf.

Q.4 Why is the Notary’s role important in real estate transactions in Italy?

The notary plays an important role in the process of purchasing a property in Italy. Although you might be able to find a property and negotiate the purchasing price with the seller without relying on a real estate agent, you will need to appear before a notary in order to sign the Final Contract of Sale. A notary is a qualified lawyer and government-appointed officer whose role is to witness both the seller and the buyer’s signatures thereby validating the change of ownership rights. The notary is impartial and acts on behalf of both parties but he is likely to be appointed by the vendor.

Q.5 You have found the house of your dreams but you do not have a bank account in Italy. Is it necessary to have one in order to purchase a property in Italy?

You do not need to have an Italian bank account in order to purchase a property in Italy. The funds can be transferred from your foreign bank account directly into the seller’s bank account. However, since this can be risky, many notaries decide to open a bank account for the foreign buyer to transfer his or her funds; the funds will be then sent to the seller when both parties sign the Final Contract of Sale.

Q.6 Can you negotiate the purchasing price and apply for a mortgage?

Sellers usually tend to sell a property for a price which is higher than what they expect to receive. Therefore, you can negotiate the purchasing price. As far as mortgages are concerned, if you are not an Italian citizen it is very unlikely that a bank in Italy will offer you a mortgage, rather, it is worth enquiring as to whether your bank in your home country can offer you a loan.

Q.7 Finally, can you live in Italy without any time restrictions simply by virtue of owning a house?

If you buy a property in Italy and you are not an Italian citizen or a citizen of the EU you cannot live in Italy without any time limitations. In other words, you can enter the country on a 90-days tourist visa, which will allow you to stay in Italy for three months only (this also applies to citizens from the UK). Nevertheless, owning a property can facilitate applying for a visa, especially the elective residence visa.

If you have further questions, please feel free to contact us at info@italianrealestatelawyers.com for a free consultation. We will be happy to help you!

 

Selling a property in Italy consists of a number of stages that need to be carried out meticulously in order to ensure that both the seller and the buyer comply with all legal and bureaucratic requirements. Drawing from this, this article will provide you with a detailed overview of the main stages involved in selling a property in Italy.

Before you design a marketing strategy for your property, you need to set the selling price by considering the price of similar properties in the area where your property is located, the condition of your property and the local supply and demand. You should be aware that buyers usually tend to negotiate the purchasing price, therefore, it is advisable for you to set a minimum price for your property. You can market your property either by relying on a real estate agency or by designing your own marketing strategy. Although the first option is a bit more expensive because you need to pay the real estate agent a commission which usually accounts for 2% or 3% of the purchasing price, a real estate agent can provide greater visibility to your listing, thereby reaching a higher number of potential buyers.

When your property is on the market there are a number of requirements that you need to meet. Firstly, if you do not reside in Italy you need to provide your passport and a bank statement which shows where you pay your taxes. Please note that you need to provide certified translations of all documents that are not in Italian. Moreover, at the beginning of the negotiation stage it is mandatory to obtain the so called “A.P.E.” (Energy Performance Certificate) which provides information regarding the energy consumption level of the property you are selling. This document is issued by an energy certifier who can either be an architect or an energy engineer who carries out the energy diagnosis of a property in order to quantify the energy consumption of the building. This ranges from A4 (high energy saving building) to G (low energy saving building). The cost to retrieve the Energy Performance Certificate varies from €150 to €250 depending on the type of property and on the city where the property is located. Furthermore, the buyer has to check all of the documentation related to the property before signing the final contract in order to ensure that everything is in order. The main documents that will need to be reviewed are the Property Deed, the Certificate of Building Permit, the Certificate of Use and Occupancy, the Cadastral Documents, the Environmental Certification and the Technical-Administrative Documents.

You can expect potential buyers who are interested in your property to send you a formal proposal through which they officially show their interest and state the amount they offer for the property. This document outlines the basic terms and conditions between the buyer and the seller and it generally includes a small deposit of approximately 5% of the property value. The formal purchase offer usually comes with a deadline by which you need to accept or reject the offer formally. If you accept the offer then the property is temporarily taken off the market and both you and the buyer can sign the Preliminary Contract of Sale.

The Preliminary Contract of Sale outlines the selling conditions and it has binding effects for both the seller and the buyer. At this stage, the buyer pays a deposit which accounts for 10% – 30% of the property value. Please note that it is harder to negotiate or amend the general terms and conditions of the purchase when the buyer has already paid the deposit. If the deposit is defined as “Caparra Confirmatoria” and the purchaser no longer wants to proceed or fails to fulfil certain obligations, you can then rescind the contract and retain the entire deposit paid. On the other hand, if you default then the purchaser will be legally entitled to a refund (which is normally double the amount of the deposit paid). Conversely, if the deposit is defined as “Caparra Penitenziale”, either or both parties can terminate the agreement.

It is worth mentioning that if there is a mortgage on the property, you will need to agree whether to pay it off before you sign the Final Contract of Sale or whether the buyer is willing to take it over.

The final step of the process is signing the Final Contract of Sale, which is the document that stipulates the transfer of the property rights from the seller to the buyer. The contract needs to be signed before a Notary Public, who is a qualified lawyer and government-appointed officer who witnesses and registers property transfers, drafts the Final Contract of Sale and acts on behalf of both the seller and the purchaser. Although the buyer usually pays a larger portion of the notary’s fee, the seller also often has to pay a small percentage. Signing this contract entails obligations for both parties; in other words, the purchaser will need to hand over the keys and guarantee that there is no risk of eviction. On the other hand, the buyer must pay the agreed price. Payment can be made through a check made payable to the seller or it can be made into a special bank account held by the notary, who will then transfer the amount to the seller once the contract has been registered at the Land Registry office. The transfer of ownership rights occurs immediately after the signature, even if the agreed price has not been paid entirely or the keys to the property have not been delivered to the buyer yet. Finally, as for taxes on properties, if you have decided to sell your “first home” (prima casa) within five years of the purchase, you have to pay personal income tax (IRPEF) or any other capital gains tax. However, if you buy a new residential property in Italy within one year from the sale, you do not have to pay this tax.

In conclusion, if you want to sell your property in Italy you need to have a good understanding of the legal and bureaucratic requirements. Therefore, it is advisable for foreigners who are not familiar with the Italian real estate market to rely on professionals in order to avoid any misunderstandings and unexpected glitches.

If you need help with selling your property in Italy, our team of real estate professionals would be glad to assist you throughout the process. Feel free to contact us at info@italianrealestatelawyers.com.

In recent years the Italian real estate market has attracted many foreigner investors. Although some people decide to move to Italy permanently, others prefer to travel to the country occasionally. Some people, for instance, travel to Italy to spend a few weeks during the summer and winter holidays and they can rent their properties while they are not in Italy, thereby generating a good source of income. Drawing from this, this article will provide you with a few tips and more detailed information about the options which are available to you after you have purchased your property in Italy.

Setting up utilities

Firstly, after you buy your property you need to set up utilities (gas, water and electricity). If these are active, you will only need to contact the utility provider and request a bill transfer. In fact, if you fail to transfer the utilities, the individual whose name is on the original bills will be liable for future payments and this can lead to legal issues if he or she moves out of the property or if your contract requires you to transfer the bills. On the other hand, if utilities are deactivated you will need to contact the suppliers to install water , electricity, gas, internet, telephone and television. The suppliers and the cost for their services may vary depending on where the property is located. You can also ask a third party to request that utilities be installed; this could be a real estate agent, for example, or someone you trust who can act on your behalf via a power of attorney. You can pay for transferring bills at a local post office, however, nowadays you can also make online payments and receive bills via email even if you do not have a bank account in Italy.

Renting your property

If you are not planning on relocating to Italy you might want to travel to Italy occasionally and rent your property while you are not there. There are several types of rental contracts:

  • Long-term contracts: there are two types of long-term contracts. The first one is 4 years long and it is renewable for an additional 4 years whereas the second one is 3 years long and it can be renewed for an additional 2 years.
  • Short-term contracts: these can be a minimum of one month to a maximum of 18 months long. These types of contracts are normally ideal for tourists and are used by Airbnb and other short-term rental companies.

The rental agreement must be a written contract and it must be registered with the Italian Revenue Office (Agenzia delle Entrate). The taxes you will need to pay on the property are calculated on the income that is generated through rent. The amount is also calculated depending on where the property is located. However, we suggest you ask an accountant for advice and detailed information about taxes.

In order to sign a rental contract you must hold an Italian Tax Code (Codice Fiscale). The tenant can decide to move out prior to the agreed date provided that he or she gives notice to the landlord. The amount of notice varies depending on the specific type of contract. A landlord may legally terminate a rental agreement if the tenant violates its terms or the law. Finally, a landlord may keep all or part of a tenant security deposit if the tenant damages the property or breaks the lease. As a general rule, if a tenant signs a contract for a couple of years, he or she will be required to pay a deposit which is equal to 3 months’ rent. 

You might want to consider relying on external help when you rent out your property in Italy. If you are unable to travel to Italy multiple times, for instance, it might be wise to employ the services of a property management company who can advertise your property, collect payment, clean the property and carry out maintenance work, if needed.

Moving into your Italian property

It is worth pointing out that owning a property in Italy does not mean that you can reside in Italy without any limits. Citizens from the USA, Canada and the UK can enter Italy on a 90-days tourist visa, which allows you to stay in Italy for 3 months only. On the other hand, if you are planning on spending more than 90 days in Italy you need to apply for a different type of visa such as an elective residence visa, a working visa or a student visa depending on your needs.  

If you would like further information about purchasing and renting a property in Italy please feel free to contact us at info@italianrealestatelawyers.com for a free consultation. We will be happy to assist you.

 

 

 

 

Be it in summer or winter the mountains are an ideal place to get away from the hustle and bustle of city life, enjoy the scenic views as you walk along curvy mountain roads, and discover quaint little villages. The Alps are the highest and the longest mountain chain in Italy and they cover all the regions in northern Italy, including the region of Lombardy. Not only has tourism grown here in recent years due to the number of events that have been organized to incentivize people to visit the area, but the share of people who have purchased a property has also increased significantly. Drawing from this, it will be the aim of this article to provide you with an overview of the real estate opportunities which this area of Italy has to offer.

The mountainous region in Lombardy is divided in four main areas: Valtellina, Valcamonica, Val Seriana and Val Brembana.

Valtellina is the largest and the most populous of the Italian Alpine valleys and it is home to some of the most famous Italian ski locations such as Bormio and Livigno. The main reason why these towns attract tourists is linked to the different activities they offer combined with a number of excursions organized through the routes of Stelvio National Park and smaller valleys. These areas offer modern and efficient ski facilities and ski slopes with several levels of difficulty, including the highest in the region. The ski facilities here are also considered to be the best due to the constant and abundant snow in the winter. During the summer the ski slopes become trails for bikers who want to experience thrilling downhill mountain biking. If you are not interested in skiing you can find countless hiking trails and paths which are suitable for everyone both in winter and in the summer. Bormio is also well known for its spas which are set in quiet and breathtaking natural landscapes, and which offer both physical and mental benefits. Additionally, these places are suitable for both families and young people; there are chalets, discos and pubs where you can enjoy a hot drink while the sun goes down.

Another area which is worth visiting is Valcamonica; the drawings which were carved into the rock by the ancient people of Camuni and which are located along the valley are part of Italy’s UNESCO World Heritage Sites. Capo di Ponte is home to the National Park of Rock Engravings where people can learn about the prehistoric population that inhabited the area. This destination is ideal for families because there are a number of activities which are organized for children in order for them to learn about history in a fun and creative way. Finally, the highest part of Valcamonica is characterized by the mountains of the Adamello Group and its regional park; both these areas are surrounded by the largest glacier in Europe, a must-see for alpinists. Ponte di Legno-Tonale is the main touristy area of Valcamonica and it has long been a great spot for skiing. This town is an excellent starting point for cycling along the most famous mountain passes (Mortirolo, Stelvio, Gavia and Tonale, just to name a few) which offer breathtaking views.

 

 

Finally, Val Brembana and Val Seriana are quieter and less known areas compared to Valtellina and Valcamonica, but they are very popular among people who live in the province of Bergamo. Foppolo is undoubtedly one of the most renowned ski resorts in this area due to its wide variety of ski slopes. Among the attractions in this area are the thermal baths of San Pellegrino which are famous for the quality of their thermal cures.

One of the most awaited events of the year for athletes and mountaineers is the Adamello Ultra Trail. This is the only place in the world where courses are run entirely on mule tracks and military paths used during the First World War. Aside from the historical trenches crossed more than a century ago by young soldiers, the athletes of Adamello Ultra Trail engage in a sport challenge 170km long to test their limits and physical strength.

For those of you who enjoy cycling and walking, the Girarifugi initiative is a competition that offers hikers the chance to win free stays in some of the hotels and resorts in the region. You only need to apply for the Girarifugi card, go to a mountain hut in Lombardy which participates in the initiative and request a stamp on your card. You will receive your prize as soon as you collect 25 points of which at least 3 need to be earned from visits to the mountain pastures.

Moreover, every year during the autumn season you can go on excursions and pick mushrooms or chestnuts. Often these events are guided by experts who advise people on the best routes in the woods, which mushrooms to pick and how to cook them.

The main events which are held in local towns and villages are the so called “sagre” which are food festivals during which you can taste local products. One of the most traditional foods is polenta, which is boiled cornmeal that originated in northern Italy as peasant food. One of its main variants includes adding local cheese, which makes it tastier and more suitable for pairing it with game such as deer and roe deer. Dairy products such as cheese are also very popular in this part of Italy and you will find many huts up in the mountains which produce different types of cheese; in particular, each area produces its own cheese and the differences in taste boil down to the diverse methods of rearing and feeding animals, and the different methods of production. In particular, Valtellina is famous for Bitto and Stelvio, Valcamonica for Rosa Camuna, Casolet and Silter whereas Val Brembana is famous for Branzi. Another typical dish where cheese is used is “pizzoccheri”, which is a variety of pasta made of buckwheat flour and served with potatoes, melted cheese and chard. Finally, Valtellina is the largest terraced wine-growing area in Italy and it is particularly suitable for viticulture due to its southern exposure and to the modest rainfalls that are evenly distributed throughout the year. The most renowned wines are Rosso di Valtellina D.O.C., Valtellina Superiore D.O.C.G. and Sforzato di Valtellina D.O.C.G.

As for the real estate market in this area of Italy, it is worth pointing out that the desire and need for fresh and clean air and social distancing caused by Covid-19 has driven many people to purchase a second home in the mountains. House prices vary depending on the type of property you are looking to buy. Among the factors that lead to an increase in house prices are panoramic balconies and the proximity to ski slopes. In August 2021 the asking price for properties for sale was € 1,600 per square meter in the province of Sondrio, in the area of Valtellina. As for Valcamonica, the cost to purchase a property varies from €1,200 per square meter (at the bottom of the valley) to €2,600 per square meter in the villages around Ponte di Legno-Tonale. The cheapest properties to buy are located in Val Brembana because it is not a very popular tourist destination. In fact, residential properties for sale cost on average € 802 per square meter whereas near Foppolo the average price reaches €1,300/1,400 per square meter.

To conclude, if you decide to purchase a property in the mountains in Lombardy you will be spoiled for choice. If you would like further information about purchasing a property in this area feel free to contact us at info@italianrealestatelawyers.com for a free consultation. We will be happy to assist you!

In recent years the number of foreign investors who have purchased property in Italy has risen significantly. The Italian real estate market has always attracted foreign investors due to its variety of choice and competitive prices, but the question is: where about in Italy should you buy property? Undoubtedly, Italy offers a great variety of properties both in big vibrant cities as well as in small towns with charming historical city centers. Arguably, the geographical area where the property is located – be it in the south or in the north of Italy, in the mountains, in the hills or on the coast – will be an indicator of a city’s lifestyle, quality of living, environmental quality, jobs and earnings, personal security and education. Drawing from this, it will be the aim of this article to provide you with a better understanding of some of the main differences between living in big cities and in small towns in Italy.

Lifestyle in big cities

Many foreigners are fascinated by big cities such as Rome, which has been defined The Eternal City due to its breathtaking historical monuments, stunning architecture and its more than 2500 years of history. Similarly, Florence, Venice and Milan are among some of the cities which are famous internationally; therefore, if you are interested in living in these cities, and especially near the city centers, please note that they will be buzzing with tourists. Cities in the north of Italy like Milan not only attract tourists but also people from within Italy due to the job opportunities that the city offers. The overall cost of living in the north of Italy is significantly higher than in the south, therefore wages in the north of Italy tend to be higher. Properties are also more expensive. The average cost for a brand-new property in the heart of some of the cities mentioned above is around 6.000 €/sqm whereas in the outskirts the average cost is approximately 3.000 €/sqm depending on the area. Nevertheless, there are big cities in the south of Italy such as Rome or Naples, for instance, where the cost of living is rather high and therefore property prices tend to be significantly higher than in other cities in the south.

Some people enjoy living in big cities due to the entertainment, attractions, shops and services they offer. Venice, for instance, organizes a carnival every year that attracts thousands of tourists who arrive in the city to enjoy the parade and the masks, an important feature of the Venetian carnival. Indeed, creating masks is an art and a tradition which dates back hundreds of years. On the other hand, Milan usually hosts many international exhibitions and fairs such as the Milan Furniture Fair or Milano Fashion Week, which occurs twice a year during the months of February and September. During this event there are more than 70 fashion shows and 90 catwalks shows through which designers from all over the world present their creations to an international audience. Another advantage of living in a big city is that public transport is efficient thus you can move from one side of the city to another by using buses, trams or the underground. 

Lifestyle in small towns

Living in small towns generally means a slower and more relaxed lifestyle. As a matter of fact, many people decide to live in smaller towns to pursue a healthier lifestyle away from crowded city centers and constant traffic and air pollution. Generally speaking, relationships with neighbors and fellow citizens are closer, especially in very small towns where everybody knows each other. Moreover, small towns do not have big shopping centers but smaller shops like bakeries, flower shops, barber shops, which are usually local family-run businesses. Every town  (and neighborhood in big cities) in Italy also organizes an open-air market once a week (usually in the mornings) where you can find clothes, food and home items. Among some of the nicest small towns in Italy are Modena, Gubbio, Arezzo, Belluno, which is close to the mountains, and medium to small cities like La Spezia, Tropea or Lecce which instead are close to the seaside, and Riva Del Garda and Bellagio which are close to Lake Garda and Lake Como respectively.  

It goes without saying that properties in smaller towns tend to be cheaper than in big cities. However, you should keep in mind that regions like Tuscany can be rather expensive, especially around Florence, Siena and the Chianti region where the average cost for new properties ranges from 1.800 €/sqm to 2.300 €/sqm. It is also worth searching for properties in other regions such as Marche, Abruzzo and Umbria where the average cost for a property is approximately 1.000 €/sqm to 1.180€/sqm and you might find affordable properties in very nice areas. On the other hand, public transport in small towns is not always as efficient as in big cities, nevertheless the Italian railway system is one of the most important parts of the infrastructure of Italy and you can easily move from one city to another by train.

Entertainment in smaller cities usually comes in the form of traditional food festivals (sagre) which are organized all year round. Here you can taste traditional dishes, listen to traditional music and dance. The town of Ariccia, for instance, is famous for its Porchetta food festival where you can taste the typical porchetta (a boneless pork roast). An important feature of small towns which is worth mentioning is religion. Many towns hold annual religious celebrations such as processions to celebrate the town’s patron saint. A famous one is the procession of Saint Nicholas in Bari for instance. Other interesting events especially in medieval towns are historical reenactments which involve different neighborhoods (contrade) in a number of competitions such as archery and horse races. One of the most famous is the Palio di Siena, a horse race which is held in Siena twice a year.

Despite these differences there are some common features that characterize both living in big cities and in small towns in Italy which include an excellent cuisine, fascinating cultural celebrations, breathtaking architecture and history.

To conclude, if you decide to purchase a property in Italy you will be spoiled for choice!  If you would like further information about purchasing a property in Italy, feel free to contact us at info@italianrealestatelawyers.com for a free consultation. We will be happy to assist you!

Italy is undoubtedly one of the most attractive destinations for many foreigners, and in recent years it has also become very popular due to the investment opportunities that its real estate market offers. However, the language barrier might discourage many when approaching the housing market, therefore it will be the aim of this article to provide you with a number of recurring words which are related to the Italian real estate market and which will help you gain a better understanding of the purchasing process in Italy.

Among the most important words are the ones related to the type of property such as:

  • Monolocale = studio
  • Bilocale = two-bedroom apartment
  • Trilocale = three-bedroom apartment
  • Appartamento = apartment
  • Villetta a schiera = semi-detached house
  • Villa = detached house
  • Rustico = rural property

When purchasing a property, it is important to check whether the property is abitabile (= habitable), in buone condizioni (= in good conditions) or whether it needs to be renovated (da ristrutturare). Usually, the most affordable properties are the ones which require a few renovations works. If you would like to make structural changes to the property it is advisable to ask a geometra (= surveyor) and an architetto (= architect) to check whether the property complies with all the local planning, building and land registry regulations prior to carrying out the renovation works.

There are two professionals you will mainly work with:  a notaio (= notary) and an agente immobiliare (= real estate agent). Unlike a public notary in the U.S., an Italian notary is a legal professional who guarantees the validity of documents such as contacts, deeds and wills. During a property sale, a notary checks that all the proceedings comply with Italian property law. The notary also checks both the seller and the buyer’s respective powers, calculates the taxes which are applicable to the transaction and after these have been collected from the parties and the Final Deed of Sale has been signed, the notary files the property with the local Land Registry (Catasto). After this filing, the transaction is officially public.

In order to purchase a property in Italy you need to hold a Codice Fiscale (= Italian Tax Code) which is an alphanumeric code that identifies citizens, non-citizens, residents and non-residents, in all dealings with Italian public authorities. Once you have identified the property that you would like to purchase, you can make an offer which is defined as Proposta d’acquisto (=Purchase Offer or Reservation Contract), which is a document that outlines the basic terms and conditions between the buyer and the seller. At this stage, you need to pay a caparra or acconto (= deposit) which is usually 5% of the property value. If no legal problems arise during the due diligence process, the parties can sign the Contratto Preliminare di Vendita or Compromesso (= Preliminary Contract of Sale) which is a legally binding document that defines the selling conditions. After this phase, the notary will draft the Atto di Vendita or Rogito Notarile (= Final Contract of Sale) which will then be signed by both parties and countersigned by the notary.

If you would like to purchase a property in Italy but you do not have time to travel to the country, you can sign a procura (= power of attorney) in order for an Italian lawyer or another person you  trust to represent you and to complete the purchasing process on your behalf.

In conclusion, while language barriers may present challenges when buying a property in Italy, the purchasing process is not generally more complicated than buying a property in your home country. Nevertheless, it is important to know the general terminology in order to have a clearer idea of the purchasing process.

If you would like help or more detailed information about purchasing a property in Italy, our team of real estate professionals would be glad to assist you. Feel free to contact us at info@italianrealestatelawyers.com.

 

If you are interested in buying a property in Italy, one of the requirements is that you hold an Italian Tax Code (or Codice Fiscale). In one of our previous articles we described what an Italian Tax Code entails; this article instead will focus on the process of obtaining one and it will analyze the tax implications for people who hold an Italian Tax Code.

What is an Italian Tax Code

First of all, an Italian Tax Code is an alphanumeric code which is assigned to every Italian citizen who is born in Italy. The Tax Code is made up of 16 characters and it is generated by combining an individual’s date and place of birth, sex, name and surname. The Tax Code is very similar to the US Social Security Number but it is used more frequently in everyday life; if you need to buy medicine, for instance, the pharmacist might ask you for your tax code because you can deduct costs for the purchase of medicines from your yearly tax return (provided that you keep the relative receipt issued by the pharmacy). The Tax Code is also required to open a bank account, obtain a mortgage, rent a house, pay taxes and purchase a property. The Italian Tax Code is usually printed on a green plastic card and on the Italian National Health Card (Tessera Sanitaria). However, this card is only issued to Italian citizens who reside permanently in Italy.

 

 

 

Where to apply for an Italian Tax Code

As mentioned above, the Tax Code is automatically assigned to every Italian citizen who is born in Italy and is registered at the Registry Office of an Italian municipality. Nevertheless, if you were not born in Italy but you reside there, you can apply for a Tax Code at any Italian Revenue Office (Agenzia delle Entrate) by providing them your ID. If you sign a written authorization you can also delegate someone else as your representative in order for that individual to apply for the Tax Code on your behalf.
On the other hand, if you would like to obtain a Tax Code but you do not reside in Italy, you need to apply for one at the Italian Consulate which covers the jurisdiction where you reside. The Italian Consulate usually requires the applicant to mail a form with the applicant’s personal information and a copy of his or her ID. In both cases, applying for an Italian Tax Code is free of charge.

The Tax Code and the real estate purchase process

As mentioned above, an Italian Tax Code is required to purchase or rent a property, obtain a mortgage, pay taxes or sign a contact. Hence, if you are interested in buying the house of your dreams in Italy even though you have not moved to Italy yet, you need to apply for an Italian Tax Code as it will be needed for a number of steps involved in the process – from the Preliminary Contract to the final Deed of Sale.
Many believe that having an Italian Tax Code implies paying taxes in Italy, however, this is not always the case. In other words, you must pay taxes in Italy only if you earn a taxable income. Nevertheless, if you buy a house in Italy you will need to pay taxes when you purchase the property and you will also be required to pay small yearly taxes. These include:

• IMU: a municipal tax you need to pay because you own a property.
• TARI: a waste tax.
• TASI: a fee that needs to be paid to the municipality for indivisible services such street lightening and road maintenance.

If you would like further information about the requirements needed to purchase a property in Italy, please feel free to contact us at info@italianrealestatelawyers.com for a free consultation. We will be happy to assist you!

 

If you are planning on purchasing the property of your dreams perhaps in a Mediterranean country, Italy has a real estate market with a wide range of properties at very competitive prices. Arguably, the most affordable properties are the ones which require a few renovations works. Drawing from this, this article aims to provide you with some useful pieces of information and tips which will help you gain a greater insight into renovation schemes, the benefits and costs.

Choosing a property is the first and most important step that will determine the time frame and cost of your renovation works. In particular, properties that need renovation works may be categorized as follows:

  • Properties requiring substantial renovation works: these kinds of properties need substantial renovation works for essential services such as water and electricity to work effectively.
  • Partly renovated properties: these properties are habitable but still need a few renovation works.

One of the factors that must be considered if you plan on renovating a property is its location. More specifically, if you decide to make changes to the floor plan or to redecorate the facade of a property, which is in an area with high hydrogeological risk or which is part of a cultural heritage sight, you will need special permits from the municipality where the property is located, and this increases the renovation costs. Therefore, it is advisable to ask professionals to check the laws and regulations concerning renovation works before carrying out any renovation work on your property. In particular, you will need the help of a geometra, an individual who carries out a large number of activities which are performed in the UK or the US by an architect, a real estate agent, and a contractor. More specifically, a geometra is an expert on local and regional planning codes, laws and regulations concerning renovation works, and together with other activities his or her duty is to ensure that the property complies with all the applicable local planning, building and land registry regulations, and with any building plan or consent issued by the municipality where the property is located.

In addition to the location of the property, it is important that you check that the walls, the roof and the foundations of your property are in good conditions. If there are parts of the property that need repairs it is advisable to ask for written quotes from professionals such as a geometra, an electrician or a plumber in order to be able to compare costs and services.

When you have chosen a property that meets all of your requirements, there are three major options to renovate it:

  1. Outsource all the renovation works to one company;
  2. Hire several professionals such as a construction team, plumbers and electricians with each team dealing with a specific aspect of the renovation process;
  3. Carry out the work by yourself and hire a professional to help you with a few renovation works.

The first option is certainly the most expensive as there will be a single company that will take care of the renovation works from the beginning to the end without you having to intervene directly and substantially in the process. Although this option might be the most convenient, if your budget is tight you may prefer the second option, which is less expensive but more time consuming because you would need to oversee and coordinate the renovation works. If you decide to go down this route, it is important to reach out to people who can help you find a good geometra as he or she will be your right hand for the conversion of your property. However, if you want to reduce costs considerably and shape the house of your dreams by yourself, carrying out the work on your own is undoubtedly the most rewarding solution. In this way, you will only need to rely on professionals to do electric and plumbing installation, and arrange the furniture.

The cost for renovation works varies depending on the type of property. Renovating an apartment could cost between 500€/sqm and 1500€/sqm whereas renovating a farmhouse in the countryside is more expensive and usually ranges from 1000€/sqm to 3000€/sqm.

The size of the property and the extent of the works also affect the time to complete the renovation project. Usually, six months is the minimum time required.

In the past few years, Italy has started offering a number of renovation opportunities. This has attracted many foreigners who have decided to invest in the so called “1- euro houses”. These types of properties are usually in small, historic and quaint villages in remote areas; although they require substantial renovation works they are still cheaper compared to an average property. As for the requirements, although these vary depending on the municipality where the property is located, as a general rule, you need to submit a renovation project and you also need to carry out the renovation works within a given number of years.

Finally, the Italian government has introduced a number of tax deductions to incentivize renovation works. Among these are:

  • Renovation bonus: the tax deductions amount to 50% of the expenses (up to a maximum of 96.000€) and they must be divided into 10 equal annual installments. The objective is to incentivize maintenance, restoration and renovation works on the property.
  • Facades bonus: the tax deduction goes up to of 90% of the expenses and it is divided into 10 equal annual installments. This is intended for painting or repairing a building’s external facade.
  • The 110% Superbonus tax deduction: the rate is applied to works such as thermal insulation, air conditioning replacements and anti-seismic works, and these works should be carried out together with other works that are financed by the eco-bonus or the so called “seismic bonus”.

In conclusion, if you are thinking of buying a house in Italy and renovating it you should consider three major costs: the cost to hire professionals, carry out the works and apply for building permits. Although the process may take up to one year to be completed, the result will allow you to enjoy the house of your dreams in one of the charming towns of the Bel Paese.

If you need any advice or you would like further clarifications feel free to contact us at info@italianrealestatelawyers.com. We will be happy to help you!

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