Italy is well-known for its red tape and this of
course can include property transactions. However it does not mean
that the system is worse than others and to some extent it could
be considered safer. For example, "gazumping" is not
possible.
Generally, there are three steps to buying a property:
Step 1: Proposal of purchase or proposta
This document is a written offer on a property in
which the purchaser acknowledges that, having seen the property,
he wants to make a firm offer stating his terms regarding finance,
survey, etc... He will also be expected to put down a non-negotiable
bank cheque as an escrow (deposito fiduciario) corresponding to
1% of the purchase price, which becomes binding if the offer is
accepted. This deposit
is held in a special bank account under the responsibility of the
estate agent.
Step 2: Preliminary purchase contract or preliminare
This contract, which is binding on both parties,
clearly states that X promises to sell to Y, who promises to buy.
Y has to deposit a sum usually corresponding to 10/20% of the purchase
price (caparra confirmatoria) which includes the previous 1% already
deposited. The notary will then require about a month to make all
the necessary enquiries, e.g. find out if there are legal problems
or if there
is a mortgage on a property, and prepare all the paperwork needed
for the final document.
In some cases, steps 1 and 2 can be carried out at
the same time.
Step 3: Final purchase contract or rogito
notarile
This final contract is signed in the notary's office.
Balance of total payment is given to proprietor, and on final signature
purchaser becomes legal owner and receives the deeds to the property
and the keys.
The extras
Foreign clients often ask "...but how much are
the extras?". It is often difficult to be exact about this
figure. However, the following should make it clearer and easier
for the client to at least understand why.
All properties in Italy are registered at the local
land-registry office (catasto) and as far as
the Italian state is concerned are given a certain value depending
on district, number of rooms, etc. This value can differ greatly
from the property's commercial value, perhaps because the property
has recently been restored, or it's in a wonderful position with
a great view, etc.
When a house is sold it has to be registered. The
registry tax (imposta di registro) is 3% on a first
house and 7% on a second property. This applies for Italians too,
not just foreigners. The registry tax is calculated on the value
stated at the land-registry office which can be considerably less
than the commercial value. Here is a simple chart:
The registry tax (imposta di registro)
| |
First
house
|
Second property |
Historical/ listed |
VAT* |
4%
|
10 - 20% |
10% |
Registration* |
3%
|
7% |
3% |
Mortgage |
€129.11
|
2% |
2% |
Cadastral |
€129.11
|
1% |
1% |
* You will be liable for either VAT or registration
tax. VAT is applicable on purchases from a company, whereas
the registration tax applies to private purchases |
The agency fee is usually 3% plus VAT (I.V.A.),
and is payable at the signing of the preliminare contract.
All property transactions must go through a notary
who is appointed by the buyer. There can be a slight variation
in price between notaries, but not much. Notary fees on a property
of €250,000 would be from €1,800 to €2,000.
The higher the price of a property, the higher the notary fees
are
likely
to be.
|
