We have provided consultation for overseas property investors, as well as retirees that wish to move to Italy to enjoy the autumn of their lives. While aiding a mixture of clients who were interested in investing in Italian real estate we noticed a number of reoccurring questions that our clients find themselves asking.
To help potential purchasers of Italian properties we’ve prepared a list of questions and answers that are more often asked than not. If you have any other queries or questions, please do contact us by completing our contact form.
Is investing in the Italian real estate market safe?
Italy is a country of great natural beauty with incomparable cultural wealth. Furthermore, it is a founding member of the European Union (EU) and a member of the Euro Zone.
The conveyance process in Italy is regulated by the Italian Civil Code and it is extremely safe. However, it is fundamental (as generally required for an investment of this importance) that the purchaser pays attention to details and makes sure that the seller is entitled to sell the property (an Italian professional can help with that).
What is the average time required from formalizing an offer to completion of the purchase process?
Assuming no particular problems arise, after the legal due diligence is carried out by an attorney or other professionals, the whole process can be completed quite rapidly, often within 4 – 6 weeks.
Do I need an Italian Tax Code to complete the transaction? What are the requirements and how long does it take to obtain one?
The Italian word “Codice Fiscale” is commonly translated as “Tax Code” or “Fiscal Code” or “Tax Number”. It is an Italian identification code necessary to perform many transactions in Italy, even as a foreign citizen, including real estate transactions. When referred to individuals, as opposed to entities, the ”Codice Fiscale” is the result of a formula applied to name, date and place of birth.
Do I need an Italian Bank Account to complete the transaction?
Although having an Italian Bank Account is not mandatory to complete the transaction, it is highly advisable to set-up an Italian Bank Account to simplify the transfer of funds from the buyer to the vendor and to look more trustworthy to the counterparty. Also non-Italian citizens and non-Italian residents can open an Italian bank account. Non-Italian residents, regardless their citizenship, are allowed to open non-resident bank accounts (“conto corrente per non residenti”) that does not entail any limitation whatsoever, in terms of disposition of your funds.
Should I use a real estate agent to complete the purchase?
Although using the service of a Real Estate Agent is not mandatory under the Italian law, many investors find it easier. If you are in need to use a real estate agent, you should make sure that the agent is registered with the local Chamber of Commerce (“Ruolo degli Agenti di Affari in Mediazione”), as required by the Italian law.
Purchasing directly from the seller is equally acceptable and will save you money in terms of commission fees payable to the real estate agent (normally the 3% of the purchase price). However, this last solution may be risk free only if you are assisted by an Italian, bilingual, legal advisor.
Unfortunately, I don’t have sufficient energy or time to travel to Italy. Would it be feasible for another person to represent me and finalize the purchase on my behalf so I can avoid travelling back and forth?
Yes, it is possible to have another person formalize the Italian property purchase or any other business in Italy on your behalf by means of a Power of Attorney (“Procura Speciale”). A Power of Attorney (PoA) gives someone else the capacity to legally represent you in one or more undertakings, including the purchase of a property in Italy. You can give an Italian attorney or any other trusted individual the ability to act on your behalf and legally represent you in all the formalities that need to be completed in order to finalize the purchase.
Can I grant a Power of Attorney only for the completion of one specific formality or do I have to grant a Power of Attorney for the management of the whole affair in Italy?
A Power of Attorney can be as vast or restricted as you need. In fact, it can be limited to one particular formality, or it can include the powers to handle all of the aspects where your signature and presence would be required (for example negotiation and determination of the purchase price, declaration of specific personal circumstances, application for tax reduction, etc.). It is even possible to include in the Power of Attorney the power to apply for a mortgage on your behalf. In conclusion, it is possible to grant someone else a Power of Attorney to complete and formalize all the necessary activities that are indispensable to complete the process of acquisition of a property in Italy, without the need to be physically present in the Italian territory.
Why should I hire a lawyer when I am already using the services of an Italian Public Notary?
The Italian legal system, in consideration of its particular historical background, attributes to a Public notary (“Notaio Pubblico”) a predominant role in drafting the purchase agreement of Italian real estate. Unlike common law countries, where the role played by lawyers in real estate transactions is exhaustive, Italian attorneys are involved in such commercial transactions mainly in the preparatory phase which consists in the preparation and execution of a due diligence and in the negotiation of terms and conditions between the parties. An Italian Public Notary has a very specific role under the Italian law. Italian Public Notaries do not represent the seller or the vendor but are public officials of the Italian Government who are in a position of neutrality between the buyer and the seller. As a consequence, notaries are no substitute for a lawyer who, on the contrary, will exclusively look after the interests of his/her client.
Is a preliminary contract of sale legally binding?
Yes, a preliminary contract of sale is legally binding under the Italian law. If you sign a preliminary contract of sale and cannot complete the purchase most likely you will lose your deposit. The deposit will not be returned the buyer does not fulfill his/her contractual promise without a valid legal reason. The vendor may also be in a position to take the buyer to court to seek additional financial compensation.
Do I need an interpreter at the execution of the contract of sale before the Notary? If yes, can I use one appointed by the vendor and/or the real estate agent?
If the purchaser is not fluent in Italian, when signing the Deed of Sale, the Italian law requires the presence of an interpreter. If the interpreter is appointed by the vendor and/or the real estate agent it is advisable to verify that such translator is duly qualified both from a legal and linguistic point of view. Furthermore, it is against the law for a translator to act in conflict of interest with one of the parties.
I need to renovate my property and I am already in contact with a contractor. Will I need a contract?
Yes, usually renovation works are object of legally binding contract. It is always advisable to have a contract professionally drafted by a lawyer where all the obligations, terms, conditions and fees are listed in detail. This can save time and money and might prevent the need of a lawsuit in case the contractor does not fulfill its obligations under the contract.
I am in the process of purchasing a property in Italy. As of now, I do not have an Italian attorney that represents me but I have a few legal matters that I would like to discuss. Can you help me?
Definitely. Contact us using the contact form on this website and we will get back to you within 24 hours.