The buying process
Nothing happens too quickly in Italy but the homebuying process itself is fairly straightforward. To ensure your purchase goes smoothly, the golden rule is to employ your own bilingual, fully experienced legal advisor. The notary (notaio) is an independent and impartial agent who oversees the conveyancing.
First obtain a codice fiscale (a tax identification number) from the authorities. Without this number you will be unable to open a bank account, buy a car, sign up for utilities or buy a house.
Once you have found a property and verbally agreed the price, you should submit a written proposal of purchase, the proposta d’acquisto. At this point the vendor can still consider other options.
Once your offer is accepted you will be asked for a deposit, usually of 10 per cent, and the notary draws up the preliminary sale contract, the compromesso di vendita. This is a legally binding contract, signed by both parties, and outlines the sale price and the completion date. Should you pull out of the purchase the deposit is forfeited, but if the vendor pulls out they must pay you twice the amount of the deposit.
The final contract, the rogito, is signed in front of the notary by both the buyer and seller, at which point the outstanding balance plus all fees and taxes must be paid. The notary issues the deeds and registers them at the land registry.
As with most of mainland Europe, buying costs in Italy are considerably higher than in the UK. As a rule, buyers are advised to budget for about 15 per cent of the purchase price. The main costs are:
Estate agent’s fees: between three and five per cent.
Notary’s fees: average three per cent.
Surveyor (Geometra): average €1,000 (£679).
Stamp duty or land registration averages 10 per cent for non-residents and three to four per cent for residents.
Additional charges may include mortgage fees and employing your own lawyer.
VAT on new properties varies from 10 to 20 per cent and is normally included in the sale price.
Surveyor's fees are sometimes included in the notary’s fees but you should confirm this.
Mortgages: Generally, the Italian banking system is much less flexible than the UK system, with most Italian mortgages only available on a repayment basis. Banks generally loan 60 to 80 per cent of the purchase price over a 15-year period.
Once you stay in Italy for more than 183 days in any one year you will be considered an Italian resident for tax purposes (the Italian tax year starts on 1 January), and will be liable for Italian taxes on your worldwide assets and income.
As a non-resident you are liable for tax only on any income and assets in Italy, such as rental income or interest from an Italian bank account, so you should still file an Italian tax return.
Income tax is 23 to 45 per cent.
There is no wealth tax in Italy.
Inheritance tax was abolished in 2001 if property is left within a family. Those inheriting will have to pay transfer and acquisition tax on the property.
Capital gains tax: If the property is sold after five years of ownership, any profit is exempt from tax. Within five years, any profit is liable for tax at income tax rates.