Property Cheat Sheet: Italy
Italy’s rich culture, history, and climate make it one of the most desirable locations for expats. From the historical sites of Rome and the metropolitan grandeur of Milan to the lush rolling hills of wine country and the scenic beaches along its long coasts, Italy has something for everyone. The world-famous cuisine, relaxed lifestyle and low cost of living are but cherries on top of the wealth and variety of locations available to expatriates.
Non-residents are able to buy property in Italy, which requires only an Italian bank account and the resulting tax number, but owning a home does not assist them in any ability to gain residency, but there are a wealth of visa options available for those who do wish to gain residency.
There are a variety of desirable locations for potential buyers to choose from in Italy. While some cities and famous regions, like Milan, Venice or Tuscany, can be expensive, there are plenty of options in more rural areas that are very affordable and still offer all of the comforts and lifestyle options of their more expensive counterparts, with excellent transport links if you do want to spend some time in other parts of the country.
Once you have picked your location and a property, it’s worth noting that a buyer should expect to spend around 10% of the price of the property in taxes and other fees, including agent fees, property taxes, sales taxes (similar to VAT and currently 22 percent) and notary fees. Any homeowner is also liable to pay income tax on the potential rental income of the property, although non-residents are excluded if the income exceeds a threshold.
When making an offer, buyers may be asked to provide a formal written letter and put a deposit in escrow in order to secure it. A solicitor should be procured to review this and any other documents going forward. Estate agents, who are impartial and paid by both parties, are not under any legal obligation to carry out due diligence checks, so prospective buyers should hire professional legal and technical advisors to make the necessary legal checks and perform a survey.
After this, the preliminary contract, or Compromesso, can be drafted. The Compromesso does not transfer the title but sets out all the details of the sale and gives the seller time to gather any necessary documents and vacate the premises prior to the agreed closing date. Usually, a deposit of 20 percent – 30 percent of the purchase price is exchanged by the buyer at Compromesso, a process dealt with by a notary who registers the transaction.
Finally, the notary will undertake a title search and draft the final contract. The signing of this must be witnessed by the notary. The purchaser will then pay the outstanding balance as well as any other fees and taxes, and the notary pays stamp duty and other purchase taxes to the government on the buyer’s behalf.
Of course, these funds will almost always be in Euros. Currency UK ensure that our clients get the most out of their money when making currency exchanges, especially when dealing with large sums. We can also hold money on account for you prior to your purchase and lock in an exchange rate for you giving you certainty on your property purchase or sale.