Via dei Colli Immobiliare assists the client from the moment of the first contact until the deed of sale is completed. And so much more.
We respond promptly to your requests, together we identify the properties that meet your needs, we accompany and assist you during the viewings, we obtain all the documentation relative to the home, we do due diligence, we keep in touch with the seller, we support you during the negotiation process, we draft an offer to purchase and hopefully a preliminary contract, we ensure you in the fulfillment of formalities related to the purchase (such as obtaining an Italian Tax Code and the opening of a Bank Account, requested for non-residents in Italy), we help advise you in choosing a notary and we are present at the deed of sale. Even after, we are here to help change the names on utilities and can even assist you in getting in-touch with english speaking accountants and other professionals.
Buying a property in Italy is a truly controlled process, much more formal than in other countries with different contractual standards and negotiation codes. If on the one side this gives a great guarantee to those who buy, on the other side, the buyer has to cope with the Italian bureaucracy, fairly difficult to understand and undoubtedly complex.
We will go step by step through all the main phases of the process.
The purchasing process in Italy is normally subject to 3 stages:
1. The offer to purchase
Once the right property has been selected, the first step for those who are preparing to buy a home is normally to fill out a written offer to purchase. Italian sellers are generally not so willing to enter into negotiations without having a written commitment from prospective buyers. Indeed, in the Italian real estate business practice there are two alternative ways of conducting a negotiation: the first one involves carrying out the negotiations “around the table”, eventually signing a document which summarises the agreements reached; the second, certainly more frequent when the buyer is not Italian, entails submitting a formal offer to purchase to the seller. With the offer to purchase, the promissory buyer communicates his/her offer to the seller, including payment methods and conditions, period of validity of the proposal, time to complete the final deed, any conditions precedent or resolutive (ex: offer valid on the condition that a mortgage loan is granted to the buyer) and any other aspect which is considered important. To strengthen the commitment, a sum of money is deposited, typically between 10,000 and 20,000 euros. This amount is entrusted to the agent – by non-transferable check made payable to the seller or through deposit on the agency’s escrow account – who will take care to hand it over to the seller if the latter accepts the offer, within its deadline. An offer to purchase accepted in writing by the seller makes the parties contractually bound. The sum handed over to the seller in most cases makes up a confirmatory down-payment (“caparra confirmatoria”, pursuant to article 1385 of the Civil Code).
2. The preliminary sale agreement
The preliminary sale agreement is a reinforcement of the offer to purchase, if this latter has been done; it is a contract between the two parties that obliges the promissory buyer and the promissory seller to draw up the final deed within a certain period, under the agreed conditions.
In the preliminary contract must be indicated, in addition to the generality of the parties: the description of the properties for sale, the details of the previous title deeds, charges and easements on the property, the details of the building concessions or works completed in amnesty, details on the energy performance certificate, the price agreed for the sale, the payment conditions and any suspensive / resolutive conditions.
The amounts paid by the buyer (20-30% of the total, as a rule) normally are a confirmatory down-payment (“caparra confirmatoria”); the non-complying party is therefore obliged to pay the sum in question to the other party as a compensation (the promissory buyer will lose the down-payment, whereas the promissory seller shall give back double the money received), who has the alternative right to ask the court for the forced execution of the contract.
The preliminary contract must be in writing and is subject to registration; it can be drawn up either in the form of a private writing, directly between the parties also with non-simultaneous signatures, or in the form of a public deed / authenticated private contract, in which case it must be drawn up by a notary and signed in his/her presence. A preliminary sale agreement signed as a public deed or as an authenticated private contract must necessarily be transcribed in the property title registers, which brings the deed to the knowledge of third parties, with the consequent effects in terms of buyer protection against later claims.
3. The deed of sale
The deed of sale of a real estate property is a public deed that must be in writing and handled by a notary public, in the presence of the purchasing and selling parties or of the attorneys appointed by them.
For the validity of the deed, which incorporates the elements already identified in the preliminary contract, it is necessary to report the entire town-planning and building history of the property, which shall be perfectly compliant to the norms, and some original documents need to be attached to deed: certificate of energy performance, certificate of land zoning if a piece of land is transferred, land/building registry plans, which shall represent the factual state. The real estate sale is normally carried out on a lump sum basis; therefore the price is determined globally and not per square meter. The delivery of the property to the buyer is generally immediate, unless otherwise agreed (in this case it is a sale with mandatory effects); the seller must guarantee the buyer from hidden defects (defects known to the seller and hidden on purpose) and from eviction (the claim on the object of sale by third parties). The buyer must pay the amount agreed upon at the place and at the time of delivery, unless otherwise agreed. Sometimes the payment to the seller is made by the notary who was previously transferred by the buyer the necessary funds; in the case of purchase connected to a mortgage loan, the bank will pay part of the sale price directly to the seller, sometimes after waiting for the so-called consolidation of the mortgage, which takes 10 days from the moment of the registration of the mortgage in the real estate register.
All moneys paid by the buyer to the seller, as well as commissions paid to the real estate agency, must be reported in the deed, in accordance with the of current anti-money laundering legislation, inclusive of all means of payment used.
In the event that one of the parties or both parties do not fully understand the Italian language, the deed must be bilingual and the law requires in this case the presence of an interpreter and translator, in addition to a witness who knows the language of the non-Italian speaking party; however, it is always possible to stipulate the deed in Italian, if the party preliminarily appoints an attorney who signs the contract on his/her behalf.
Checks, verifications and necessary requirements.
There are many documents that must be produced and verified before the final deed of sale can take place; this gives a great guarantee to those who buy, compared to what happens in many other countries.
Basically, a property, to be suitable for selling, shall comply with the town-planning and building codes and with the floor-plans filed with the Land/Building Register; moreover, correct property titles shall be present and no undeclared burdens or liens shall emerge (mortgages, distraints, injunctions, seizures, servitudes, hand-over of real rights, etc.)
Land/Building registry compliance
The edifice must comply with the floor-plans filed with the Land/Building Register and the entry of the property to the land registry must also be correct; it is not possible to sell an irregular property under these two aspects.
The registry of all the real estate properties is held in Italy by the Revenue Agency, a branch of the Ministry of Finance which includes within it the offices of the Land/Building Registry (Castato) and the Title Register of Real Estate Records (conservatoria registri immobiliari)
The land/building registry, subdivided into land register and buildings register, is the inventory of all the existing real estate on the national territory, with an indication of the relative tax value (cadastral income, dominical income and agricultural income) associated with each of them. The documentation produced by the land registry, instrumental to the real estate purchase, consists of:
- Site map
- Cadastral floor-plans of the buildings
- Cadastral inspection entry (by name or by land parcel and subaltern)
- Layout plan
The cadastral information is accessible electronically and we provide our customers with a copy of all these documents.
Property titles and check on liens/burdens
The information regarding the ownership of the property and the presence of restraints, mortgages or other liens, can be obtained from the title origin of the property (previous sale, donation, succession, allocation or other title), and from inspecting he Title Register of Real Estate Records, also electronically. Mortgages and other prejudicial entries have a duration of twenty years and are automatically extinguished if not renewed within their deadline. The properties received by donation suffer from reduced possibility to be marketed because, according to Italian law, the donation can be contested by any legitimate heirs for a period of 20 years, or within 10 years from the death of the donor, if in the meantime he/she has deceased. The information regarding the ownership of the property and the presence of restraints, mortgages or other liens, can be obtained from the title origin of the property (previous sale, donation or succession), which must be presented to the notary, and from the Title Register of Real Estate Records.
Via dei Colli carries out the necessary checks at the Title Register of Real Estate Records, even before the practice is passed to the notary.
Compliance to building codes
Since the deeds of sale of unauthorized buildings are void, it will also be the responsibility of the seller to present to the agent and to the public official (the notary) the documentation proving the actual town-planning regularity of the building and in particular:
- Copy of building permits issued by the municipality (building consents) or of the permission in an amnesty
- Copy of the last architectural plans approved by the municipality
- Certificate of occupancy, issued by the municipality
- Certificate of land zoning, issued by the municipality, in case the object of sale is a land
- Certificate of conformity of the installations
- Certificate of energy performance
The real estate agent will take care to assist the parties, up to the notary deed of sale, in the verification of the cadastral compliance, as well as in the verification of building and town-planning compliance of the property, collecting all the necessary documentation and examining it.
Requirements regarding the buyer:
The buyer who is not resident in Italy, before purchasing, must obtain the taxpayer’s code.
This may be applied for either at the Italian consulate / embassy in your country of residence, or by proxy through us or through the notary.
The purchaser is also required to present, before purchase, a marriage certificate, if married.
The opening of a current account in Italy is not mandatory, but it is certainly recommended, in order to then manage the payments of the various utility contracts.
The real estate agent is obliged to keep a register of customers and transactions; Via dei Colli will then ask you some information on the origin of the funds used for the purchase and on your profession, as well as all your personal data and a copy of your identity documents.
Taxation on real estate.
Taxes at completion
The sale of a property is subject to certain taxes, all to be borne by the buyer, as is the case with the notary’s fee. In the case of the purchase of a real estate unit from a private individual or a non-construction company, the buyer will have to pay to the notary, who acts as tax collector for the State, 3 different types of taxes, proportional to the value of the property:
- Registration tax, equal to 9%
- Mortgage tax, fixed amount (50 euros)
- Cadastral tax, fixed amount (50 euros)
- Tax filing, stamps, other fixed taxes, about 450 euros
In the case of purchase of a home from an individual or a non-construction company, the above taxes will be calculated on the basis of the cadastral value of the property (“price-value”); the cadastral value is a function of the cadastral income associated with the property and, in our areas, is typically between 20 and 50% of the market value. To calculate the cadastral value of residential properties, the cadastral income resulting from the Land/building register records should be multiplied by 126 in the case of a second home and by 115.50 in the case of a “first home” (Prima casa).
If the buyer can make use of the benefits offered by the “first home” (with the obligation to transfer residence within 18 months from the purchase), the registration tax is reduced to 2% and the other two taxes are paid at a fixed rate of 50 euros each. It is not possible to buy as “first home” properties included in the “luxury” category (cadastral category A / 1, A / 8, A / 9) ;.
In the case of purchase from a construction company, the above taxes will be paid as a fixed tax of 600 euros, and to the price of the property shall be added a 10% VAT (4% if first house).
Regarding the purchase of land, the applicable tax (on the value of land declared at completion) is equal to 15% for agricultural land (plus 100 euro of fixed taxes) and equal to 9% for building land (plus 100 euro of fixed taxes).
Capital gains on the sale of properties
An individual person who earns a capital gain from the sale of a building is required to include it in the tax return, or to pay a 26% substitute tax, if the sale took place less than 5 years after the purchase; notwithstanding this principle, the capital gains on properties, used as main dwellings for most of the time between purchase and sale, are not taxed. Capital gains relating to properties received by donation or succession are not subject to income tax.
Capital gains on building land are always subject to taxation and must be included in the income tax return.
Other costs and fees linked to the purchase
Notary fees in Italy are paid by the buyer: each deed is different and the fee also reflects its complexity and there are no pre-set tariffs.
The fees of the real estate agent/agents involved in the deal are borne by both parties, each for its own responsibility; also in this case, there are no fixed tariffs. However, in the absence of an agreement, it will be applied the prevailing fee resulting from the tables of local customs and practices collected by the individual chambers of commerce.
During the public deed, it is required the presence of a translator and interpreter in the event that one of the two parties does not currently understand the Italian language; the relative cost depends on the number of translated pages and on the time spent by the interpreter during the deed.
Annual taxes on buildings
IMU: property owners (owners, usufructuaries, emphyteus, owners of rights of use and housing) are required to pay municipal property tax, with rates ranging from 4 to 10.6 per 1000, to be applied to the revalued cadastral value of the property. The IMU must be paid in 2 instalments, in June and December.
Garbage tax: paid annually to the municipality: the amount depends on the size of the property, intended use and number of dwellers.
IRPEF: real estate must be included in the tax return for individuals, whose presentation is mandatory for those who produce income in Italy. IRPEF has progressively increasing rates as the tax base increases. Income associated with buildings must be included in the income from land (from land or buildings). In the case of buildings, it is necessary to distinguish various situations:
• if the property is leased, the annual rental income must be reported, with a deduction of 15%
• in other cases, the cadastral income has to be reported
Rental income: as an alternative to the inclusion of rental income within the income tax return, it is possible to opt for the substitute tax (cedolare secca) at 21% on rental income; in the case of renting at a controlled rental rate, the cedolare secca is lowered to 10%.
In the case of short-term rentals for tourism purposes, it will be the intermediary (for example, Airbnb, booking, etc.) that must directly withhold the tax of 21% from the sum due to the owner, acting as a substitute tax collector for the Italian state.