Purchase property procedures in Italy
Every country differs in legislation when it comes to purchasing a property. Italy has its differences and peculiarities and differs from the Uk system. However, it is less likely for the buyer or the seller to have a change of hearth as during the first stage “Proposta d’acquisto” a small amount of money is exchanged. This is done to give this both the seller and the buyer a sense of security.
Unlike in the UK, both the buyer and the seller pay a percentage fee when purchasing a property in Italy, which varies between 1 and 4%. The agent undertakes all the property check before placing the house on the market, to avoid nasty surprises down the line.
To be able to buy a property you must apply for a “Codice fiscale” a sort of National Insurance number that allows you to make any purchase in Italy, from a car or a motorbike to a house and open an Italian bank account, to which you would need to link your future house bills.
The purchase stages
The Proposal of Purchase
This is the buyer’s declaration of wanting to purchase a property in Italy at a certain price. This form contains the essential elements of the future sale. Both the buyer and the seller will sign the proposal for purchase, in acceptance.
The proposta d’acquisto, unlike in the UK, it is only valid if a deposit is made of approximately 5% of the property’s value. This is to ensure that the proposal is genuine and to avoid timewasting for both the buyer and seller. This will be returned or deducted from the purchase price once the deal goes through.
It is called proposta d’acquisto irrevocabile (irrevocable) because this seals the deal. If the seller changes his/her mind he or she will lose the deposit and if the buyer changes his/ her mind he would have to pay twice the amount to the buyer.
For peace of mind, the buyer can instruct an Architect or Geometra and a Solicitor to make all the necessary checks.
Should the buyer change his mind he/she will lose the deposit, should the seller have a change of hearth he/she would pay back double the amount to the buyer. This is in fact used as a deterrent.
The Preliminary Contract
(Contratto preliminare or compromesso)
The preliminary contract is signed so that both parties are juridically bond during the time needed to sort out all the necessary steps such as a mortgage or other financial agreements.
When the seller accepts, the buyer’s offer automatically becomes a preliminary contract “contratto preliminare” this is an agreement between seller and buyer, the contract must then be registered and transcribed.
At this stage, both parties are obligated to stipulate a consecutive and definitive purchase agreement (deed).
The transfer of the rights on the property will only take place when both sign the deed.
When the preliminary contract is stipulated, the buyer also pays a sum of money as down payment which usually around 10- to 15% of the total value of the property, however, this can vary between sellers.
This so-called “caparra” will be deducted from the total sum due.
The Final Deed
(Rogito or atto di Vendita)
All the parties, usually in front of a solicitor “notaio” sign this document. The solicitor choice as well expenses falls onto the buyer responsibilities.
Once the deed is signed the purchase is completed.
When the client shows interest in viewing and purchasing a property the agent will forward a contract of engagement between the agent and buyer, in agreement with the agent representation and with the consulting fee.
As previously stated, In the event of a Buying or Selling of a Property, the fee for our Real Estate Consulting services, is paid by both Seller and Buyer as follows:
Italia Living Indicative Pricing
- Up to 5 million euro: 3,00 /4,00% (four percent) plus VAT, if applicable, on total purchase price;
- Up to 10 million euro: 3,00% (three percent) plus VAT, if applicable, on total purchase price;
- Up to 20 million euro: 2,50% (two fifty percent) plus VAT, if applicable, on the total purchase price;
- Up to 50 million euro: 2,00% (two percent) plus VAT, if applicable, on total purchase price;
- Over 50 million euro: to be agreed case by case.