Contractual assistance for purchasing properties in Italy
Any discerning prospective buyer looking to purchase property in a foreign country knows how important it is to understand the local real estate market and legislation. Being aware of how contracts are drafted, who the main professionals who need to be employed are, and what each is in charge of, is the key to a fruitful investment.
The complexity of a foreign legal system and language barrier can make buying property difficult for a foreigner. Being able to count on competent bilingual advice provided by trustworthy qualified professionals on site is essential. Trying to find your way through the Italian real estate scenario and legal system? Our team of proficient real estate agents, accountants and lawyers is ready to assist you with the purchase of property in Italy.
First and foremost we advise you to work with a competent real estate agent, to be both time and cost-effective. No concerns about qualification: Italian law requires all real estate agents and agencies to be licensed, qualified and registered at the local Chamber of Commerce. As concerns commissions real estate agents are paid a provvigione, commission. Buyer and vendor generally share the cost, which usually equals between 2.5% and 3% of property purchase price.
Parties are entitled to negotiate, and may agree for the commission to be settled by one of the two only. Foreign buyers are often required to sign an engagement agreement, defining commission, mandate and exclusivity. This should be reviewed carefully before accepting, and probably translated as it is bound to be drafted in Italian.
As concerns mandatory property-related paperwork a prospective foreign buyer needs to be well aware of the documents the vendor is required to provide. These, are crucial to proper compliance with standing legislation, include:
- the APE – attestato di prestazione energetica, an energy rating certificate drafted by an engineer, architect or surveyor which lists the characteristics of an energy-efficient building. This is required because it summarizes important data such as the type of building, details on heating, air conditioning, energy, hot water provision, and the like.
- the Land registry certificate – provided by the Agenzia del Territorio which contains information on deeds of transfer of ownership, property rights, raising and writing-off of mortgages. This document is crucial as it concerns legal compliance and property rights. Also, the ownership transfer will have to be registered at the Land register, upon payment of the due tax, generally about 1% of the purchase price, by the buyer.
- the certificato di abitabilità, i.e. a certificate of habitability – the Italian Civil Code maintains that the vendor produce all documents related to the property including a certificate of habitability confirming the building is fit for occupancy. The designated notary who drafts the final transfer deed will ask for this document.
- a planning permission building certificate – this is issued by the city hall in charge of the area where the property is located. It proves the property was constructed according to Italian law, which comprises floor plans, planning permits and related documentation; provided by the city hall, usually online.
Once all documents are in order the prospective buyer (or the realtor) draft a purchase proposal, known as offerta in Italian, informing the vendor of his/her interest in proceeding with the purchase, at a certain cost within a certain time span. Once signed the purchase proposal is binding for both involved parties. This step is discretional, and often passed up.
The preliminare, i.e. preliminary contract, is a private agreement which itemizes the full negotiated property price as well as the conditions that need to be met prior to finalizing the sale. Legislation as issued starting January 2007 maintains that all preliminary contracts must be registered by Italian real estate agents. The buyer is usually required to settle the cost of registration and a deposit which generally ranges between 10% and 30% of the total cost.
Final deed of sale (Rogito)
The final deed of sale is drafted, and signed before a notary once all is set, agreements completed and tasks fulfilled. Choosing the notary is generally up to the buyer, who selects a professional often counting on his/her real estate agent’s or lawyer’s advice. Choice of the notary in charge, and possibly selection of a bilingual notary or employment of a translator in case of a foreign party involved, is very important. The notary’s job is to read the contract, checking its completeness, legitimacy and reciprocal understanding of the two parties. The content must be understood, confirmed and three copies of it signed by the two parties before the notary, The buyer then settles the outstanding balance payment, generally via an Italian bank draft or wire transfer. Out of safety and caution we recommend using the notary’s escrow account, a bonded client account – as maintained by Italian Law n.124/2017 – via which notaries may receive funds due for properties.
As regards Italian notaries’ fees these vary according to property prices, but a safe estimate is approximately 1% of the purchase price.
Can a foreign buyer carry out all required property purchase proceedings in Italy, and be sure these are straightforward, law abiding, smooth and seamless? Definitely, provided he/she has a crew of dedicated English-speaking professionals to assist. Providing comprehensive expertise and full knowledge about standing rules, our team enables prospective buyers to enjoy flawless handling and successful deals. Committed to our clients’ success, we scour the records, inspect documents – Land Register plans, Energy rating certificates, Certificate of habitability – provide full translations and draft due diligence and technical reports. We prepare and submit preliminary contracts, and assist in finding a suitable notary. Via a special power of attorney we are also able to act on our clients’ behalf, should they be unable to attend the final deed or in need of professional bilingual support.