Whatever your reasons for buying a property, this is probably the first time that you have bought a property in Italy. We have put this guide together to help you understand a little more about the process of buying in Italy.
This guide is aimed at providing some basic information about buying in Italy and tries to answer the majority of the common questions that we are asked about. Although we hope that you will find it useful it is important to remember that it doesn’t cover all legal issues involved and certainly isn’t a step by step DIY guide to buying in Italy.
We’ve also put together a guide to useful terms to know when buying property in Italy, including both the Italian terms and their English translations. You may also want to take a look at our Buying Property in Italy Checklist.
While we hope this guide helps to somewhat demystify the process of purchasing Italian property, it is still recommended that you seek advice from a professional before proceeding – after all we do this every day and have been doing so for many years and therefore know all the tricks and pitfalls that you may come across
We also know the practical solutions to the problems that exist and understand how Italian law interacts with UK law, so can help to ensure you meet all of the strict requirements of both countries’ laws.
For specific advice on buying Italian property tailored to your needs, please get in touch with our friendly, expert Italian property lawyers based in the UK.
Buying property in Italy FAQs
Is the legal system in Italy the same as the UK?
No, they are very different, but there is an interaction between them when you buy a property in Italy. That is why the best person to advise you on your purchase in Italy is somebody who understands both Italian and UK law.
Do I need a lawyer to help me buy in Italy?
Surprisingly, this is the most common question that we get asked. No, you don’t – just like you don’t necessarily need a lawyer when buying in the UK. However, in reality you would always use a lawyer when buying in the UK so what is so different about buying in another country where you probably don’t have experience of buying before?
For more information, please take a look at our guide to how to choose a lawyer when buying property abroad.
I have been told that I don’t need a lawyer but need a Notary. Is this true?
The Notary is necessary in Italy but tends only to get involved at the end of the transaction. His role is to carry out some checks at the end, attend to the signature of the title deed and register the property. He doesn’t normally advise on whether the contract is OK to sign, whether you should pay the deposit, who should own the property, and so on.
I have heard there are problems with buying property in Italy. Is that true?
Certainly, there are potential problems when buying in Italy, just like there can be in any country including the UK. Most of the potential problems that you read about can be avoided by using common sense and by instructing an independent lawyer to advise you on the purchase.
We often see people with problems with their property and they invariably tell us that they didn’t use a lawyer or used the lawyer given to them by the seller or estate agent.
Are the costs of buying property more in Italy than in the UK?
Yes, the total costs in addition to the purchase price are higher than you will be used to in the UK. It is therefore important to factor these into your budget from the beginning.
As a rough rule of thumb, you should budget for something in the region of 8% of the value of the property for properties of euro 200-400k. However, for more expensive properties, the percentage is lower. This should cover all legal fees, Notary fees, taxes and so on.
What are the additional costs involved in buying Italian property?
Mortgage costs – If you are taking out a mortgage the cost will be slightly higher as there are normally additional bank costs and further costs for the professionals (solicitor, Notary) involved in the organization of the mortgage deed.
Costs for buying off-plan – On a new property you may have to make periodic payments throughout the course of construction. The balance is paid upon signature of the title deeds and registration.
To find out more, please take a look at our guide to the costs of buying property in Italy.
Do you need to pay a deposit when buying property in Italy?
You may be asked to sign a purchase offer and pay a small deposit (typically around €5,000). If the seller accepts your offer, you will then be committed to buy or, alternatively, you forfeit the deposit paid.
It is important that any document you are asked to sign, including estate agency agreement, is checked by your solicitor in advance.
After that you would work towards a preliminary contract and typically pay around 10% - 20% of the price. That contract commits you to buy the property.
Can you get a mortgage to buy property in Italy?
There are two ways of financing your purchase in Italy through a mortgage.
The first is to release equity from your UK assets to buy the property in Italy. The second is to mortgage the property in Italy.
Each has advantages and disadvantages but getting it wrong can cost you dearly so take advice on this.
If you wish, we can put you in contact with mortgage brokers either in the UK or in Italy. We do not receive a commission for doing so and are not tied into a particular broker – we simply recommend them because they have given our clients good service in the past.
Obtaining a mortgage in Italy depends on the Italian Bank. If you are buying a property in Italy that already has a mortgage on it, it is quite simple to cancel that old mortgage and have a new mortgage registered at the Land Registry.
It also may be possible to take over that mortgage from the current owner.
For more information, please take a look at our guide to mortgages on foreign properties.
Do you need a survey when buying an Italian property?
If you are buying a property, we would always recommend that you obtain an independent survey. If you obtain a mortgage, the valuation carried out for the mortgage company will only look at whether the property is worth the amount you have negotiated. Any defects in the property which do not affect the value will not normally be shown on the report.
An independent survey will examine the property’s compliance with building regulations, permits, and necessary registrations. It may also verify the condition of the structures and will highlight any important problems that could affect the property value. Advice on future maintenance may also be included.
The survey should reduce the chance of discovering any nasty surprises with the condition of the property once a purchaser has bought the property. If there are any defects, the survey will help the buyer negotiate the price or require certain works to be carried out before the property is purchased.
Your lawyer may need to insert specific conditions into the offer or preliminary contract to best protect your interests. The survey may also reveal that certain works have been carried out or highlight rights that are necessary for the property which we can investigate before the property is purchased.
How does the exchange rate affect the cost of buying a property in Italy?
When you are converting from one currency to another the difference between one exchange rate and another can literally make a difference of thousands of pounds on your purchase.
Do not underestimate the difference that a good exchange rate can make.
In some instances, clients who have sold properties have made more money on the exchange rate difference than they have on the sale of their property.
We are not a bank or currency dealers, but would recommend that you investigate the cheapest way of sending your money abroad. Currency dealers have increasingly sophisticated products. You can agree rates for the future. You can get them advising you when to buy or agreeing to buy for you when the rate hits a certain level. You can even agree a fixed rate for longer periods of time if you make regular payments abroad (for example for a mortgage or moving your pension money).
We work with currency dealers who can give you a good exchange rate for your purchase and whom we have known for years. We will normally receive a commission for introducing them to you. This does not cost you anything more as they are simply paying us part of what they make. This commission is costed into our overall charges for providing our services.
Should you use a Power of Attorney to buy property in Italy?
A Power of Attorney is a document which allows somebody to do something on your behalf.
As the title deeds are signed before a Notary in Italy, clients often prefer to grant a Power of Attorney to a trusted individual to sign the title deeds on their behalf.
This has several advantages:
- You can avoid an unnecessary trip to Italy just to sign the title deeds.
- Signing title deeds is not particularly exciting and most people prefer to use their time off enjoying the property rather than signing pieces of paper.
- It normally works out cheaper than you going out to Italy to sign.
Please note, you should only give a Power of Attorney to somebody that you trust as they allow that person to do things legally on your behalf.
In Italy Powers of Attorney have much wider faculties than we are used to in the UK and often have very general clauses in them “just in case”. We try and limit the Powers of Attorney down as much as possible whilst still allowing the person appointed the freedom to do what you need them to do.
We charge £400 plus tax to draw up a Power of Attorney and translate it into Italian. On top of that, you will have Notary fees, foreign and Commonwealth Legalisation fee (£30 per document), translation stamp duty tax in Italy and often Courier fees.
For more information, please take a look at our guide to using Powers of Attorney.
What is fractional ownership?
Fractional Ownership is not a new concept and has been around for many years – although back then we called it Co-ownership.
Put simply, Fractional Ownership is where several people buy a property together. This can be members of a family, friends, work colleagues or even complete strangers.
You buy a share in the property and also share the running costs.
The best Fractional Ownership schemes are those where the cost of buying is closest to the value of the actual share in the property – i.e. the ones where there are not huge margins built into the sale.
Timeshare is a type of Fractional Ownership but Fractional Ownership is not necessarily Timeshare as there are strict definitions as to what Timeshare is.
How do Italian tax codes work?
The Italian Tax Code (in Italian, codice fiscale) is your Tax Identity Number in Italy.
There are several times when you are likely to be required to produce your Italian Tax Code:
- When you buy a property
- Opening a bank account
- Dealing with the utility companies
- Taking out insurance
- Dealing with the tax authorities
- Buying or selling shares, bonds and stocks
- Buying a car
- You can either apply for your Tax Code personally or through us. Our fees for this come to euro 250 plus taxes per person.
Who should own the property?
This is probably one of the most important decisions that you can make. Getting this right can save you thousands in costs and taxes. Getting it wrong can be an expensive mistake.
The way that you would buy a property in your home country is not necessarily the best way to buy in Italy so don’t assume that you can adopt what you have done here to your purchase in Italy.
There are many options – ranging from personal ownership to company ownership but there is no “one size fits all” solution that works for everybody.
Your circumstances and priorities are different from the next person. We are able to look at your circumstances and your priorities and advise you who should own the property based on that information. The solution may not necessarily be immediately obvious.
When deciding on the best form of ownership we would need to take into consideration both Italian and UK tax and also a range of other circumstances such as your plans for the property in the future.
For more information, please read our guide to company ownership of foreign properties.
Who do you need to inform when you buy a property in Italy?
There are various organisations, companies and official bodies you will need contact when you buy an Italian home, including:
- Residents Association (Condominio)
- Water and Electricity
- Land Registry (Agenzia del Territorio)
- Town Hall (Comune)
To find our more, take a look at who to tell when you move into a property in Italy.
I’ve inherited an Italian property, what do I do?
Many people who inherit a property abroad do not understand what the legal requirements are, whether they wish to keep the property or sell it. We can advise you on your options and make sure all of the necessary issues are taken care of, allowing you to make the most out of your inheritance.
To find our more, please see our guide to inheriting Italian property.
Do I need to make an Italian Will when I own property in Italy?
Italy has different inheritance laws to the UK, so it is generally a good idea to make an Italian Will in addition to your UK Will. While you can simply leave your Italian property to your chosen beneficiaries in your UK Will, this will normally significantly increase the inheritance costs to your beneficiaries and does not generally make financial sense.
To find out more, take a look at our guide to making an Italian Will.
Our legal fees for buying property in Italy
We charge 1.5% of the purchase price subject to a minimum of £2,000 + VAT. If the property title is defective or unexpected additional work is required then there may be additional charges.
We would inform you before incurring this cost.
Our charges include:
- Legal advice on the terms of your offer to purchase
- Liaising with the seller, the estate agent, the Notary Public in Italy
- Organizing the purchase contracts
- If requested, dealing with the surveyor and draft the contracts according to his report
- Arranging and assisting you (or signing by means of a Power of Attorney) at the signing of the purchase offer, preliminary contract and title deed
- Double check (the Notary is in first instance responsible for this) the good title to the property
- Arranging all payments related to the property (purchase price, notary’s fees, taxes, estate agent, etc.
- General hand holding and advice throughout the transaction
Why use Judicare for buying property in Italy?
We have an experienced Italian legal team comprising Italian lawyers and English lawyers who assist with Italian law.
We are UK-regulated solicitors
We are a UK based firm of Solicitors regulated by the Solicitors Regulation Authority and who specialise in international legal issues.
We understand both UK and Italian law
Because we understand both sets of laws we understand the difficulties that come when two sets of laws meet. This is particularly important when it comes to issues involving ownership, taxation and inheritance.
We are members of AIPP
The Association of International Property Professionals was set up to improve standards of professionalism in a largely unregulated overseas property market.
Our Italian team has many years of experience dealing with a whole range of legal issues with Italy.
We speak your language
You need a lawyer who can speak your own language. More importantly you need somebody who can explain and discuss often complicated issues in terms that you understand.
We are independent. We are not allowed to act for the buyer and the seller at the same time. We are not linked with any Development Companies, Builders or Estate Agents.
Need help buying property in Italy?
Our UK-based property legal team are highly experienced in helping clients to buy and sell property in Italy, as well as handling a whole range of related issues, such as advice on Wills and inheritance.
With a thorough understanding of both UK and Italian law, we can provide clear, reliable legal guidance in plain English, giving you the confidence to deal effectively with property in Italy.