Have you decided to invest in properties in Italy? What are your next steps? It is important to have a good understanding of the purchase process in Italy, as it will help you avoid some of the most common hazards of home-buying.

The list below covers the main steps you will go through when buying a property in Italy:

1) PROPERTY SEARCH

Begin by searching for a property that suits your needs and budget. You can use real estate agents, online listings, or local classifieds to find suitable properties.

2) THE Italian Codice Fiscale (FISCAL CODE) (BHHS Palazzo Estate will take care about)

For purchasing a property in Italy, as well as to open an bank account you will need a FISCAL CODE - an identification code calculated on the basis of your surname, your names, the place of your birth and the date of your birth and which will be used any time you will need to deal with the Authorities.

3) FORMAL OFFER OF PURCHASE

Once you've found a property you like after viewing some properties, you can make an OFFER to the seller. Negotiate the price and terms of the sale. If the seller accepts your offer, you'll move forward with the purchase.

The offer of purchase (PROPOSTA D'ACQUISTO) must be in writing. Then, if the seller accepts your offer - you will be communicated in writing. This means that seller undertakes not to sell the property to anybody else until a certain date. The offer of purchase, once accepted, is legally binding.

4) DUE DILIGENCE

First of all your broker has to make the cadastral check that the property is regularly registered and it belongs to the person who is undertaking to sell it, by investigating the Land Registry. Your real Estate Agency should conduct due diligence to ensure there are no legal issues, outstanding debts, or other encumbrances on the property. You may want to hire a notary or lawyer to help with this process.

5) PRELIMINARY AGREEMENT (Compromesso or Contratto Preliminare) Usually takes place if the period between the accepted purchase offer and the Notary deed is more than 2 months.

Both parties sign a preliminary agreement, a legally binding document, that outlines the terms and conditions of the sale, the agreed sale price and any rights the property has. The Rogito is then drafted and it is usually executed 1 to 2 months after the execution of the Compromesso.

This agreement requires a deposit “caparra confirmatoria”, which is typically around 10% of the property's purchase price. If you back out after this stage, you may lose your deposit. If the seller backs out, they typically have to pay you double the deposit. For example: If you paid a deposit of €25,000 you will get back all the money you've paid for the deposit (€25,000) + another €25,000.

The deposit amount may vary on many factors. Nevertheless, usually the lower the asking price the larger the deposit and viceversa.

There are two types of agreement in Italy: one is a a private contract, the other a public document. The notary can both drawn up authenticate private deed or public document.

6) FINAL CONTRACT (Rogito or Atto di Vendita)

The final sales contract is drawn up and signed by both parties in the presence of a notary public, once all the documentation is available and the balance is paid. The notary ensures that the property's title is clear and handles the transfer of funds from the buyer to the seller.

7) REGISTRATION

 The final contract is registered with the local land registry office (Ufficio del Catasto). This step ensures that the property is officially transferred to your name.

8) FEE and TAXES

 You'll be responsible for paying various fees and taxes, including the property transfer tax, notary fees, and registration fees. These costs can add significantly to the purchase price.

Ongoing Costs: Don't forget to budget for ongoing costs such as property taxes, utilities, and maintenance.

9) PURCHASE COST

The total fees for buying a property in Italy are approximately 10 percent of the purchase price. It may vary from case to case.

• Agent’s commission

Once the deal is closed thanks to the intervention of the real estate agent, according to article 1755 Civil Code, your broker is entitled to a commission from both parties. 

In case you rely on a real estate agency to find your dream home in Italy, you will pay a commission which is around 4 -3 - 2% of the purchase price + VAT (I.V.A.) 22% of the fee (depends of the region where the property is located).

The agent's commission is not divided between seller and buyer, each one has to pay a commission.

NOTARY

In Italy, the role of a notary (notaio) is crucial during the process of buying a property. Notaries in Italy are legal professionals with specialized training and expertise in real estate and contract law. Their role is to ensure the legality and authenticity of property transactions and related documents.

Due to their crucial role, it's advisable to choose a qualified and experienced notary when buying a property in Italy to ensure a smooth and legally compliant transaction.