The first step of buying a property in Italy is the Pre-Contract Agreement. This is usually organized by the buyer. Italians often use standard PCA, that you can buy or download from the internet. In some cases the Pre-Contract is drafted by a solicitor.
A confirmatory deposit is paid by the buyer, upon signature of the PCA.
Once the pre-contract is signed, the buyer employs a Notaio to prepare the final contract (Rogito).
In order to draft the rogito, the Notaio needs the property’s documents.
- Certificates from the Catasto Office (Visura Catastale, Mappa Catastale, etc)
- Proves of ownership, i.e. copies of purchase contracts, donation or other.
- Building permits.
- "Certificato di Destinazione Urbanistica" – issued by the Borough Council.
- Letters of “Renuncia al Diritto di Prelazione”, signed by all farmer neighbours (only for rural properties.)
This list is not complete, there may be more documents required.
The Notaio then prepares the final contract (rogito), but only if he is sure that there are no impediments, rights, obligations and reservations, pending suits, any liens and charges, whatever their nature.
Italians don't usually employ a solicitor to sign the final contract. The Notaio makes sure that the sale is valid, and the title deeds are passed to the buyer correctly.
As mentioned, the Notaio requires many documents to prepare the final contract (rogito). However, it is not his responsibility to gather these documents. Italian buyers do this "assistance to the Notaio" by themselves, providing him with all the information he requires. Foreign buyers can employ a geometra, the estate agent (i.e. L and G Properties) or a solicitor.
In more details, the contract assistance includes for the followings:
- Prepare the Pre-contract agreement (Compromesso),
- Gather the property's documents: Cadastral data, previous title deeds or inheritance, etc,
- Obtain the property's Certificates. This requires many visits to several offices!,
- Agree with Notaio the figure to be stated on the Contract.
- Organize the Contract with the parties.
- Assistance with translation for Contract signing or power of attorney. This item might require an additional cost of around 500 €.
Taxes are paid to the Notaio. The main tax is the stamp duty, plus minor other taxes.
Taxes are based on the cadastral value. The cadastral value is determined by multiplying the "cadastral income" (raised by 5 per cent) by a coefficients. However, taxes can also be based upon the property price. The Notaio usually advise which way is the cheaper, in each case.The rates are the followings:
18 % of the cadastral value / purchase price of the land.
10 % of the cadastral value / purchase price of the buildings.
2 % of the cadastral value / purchase price of the buildings – for 'prima casa' (First Home)
Properties can be purchased as primary residence (prima casa) or secondary residence. Purchase taxes for prima casa are much cheaper. The reduction for prima casa of the stamp duty does not apply to land, but only to buildings.
When a property is purchased as prima casa, the buyers have to officially move in the house within 18 months from the purchase.
Methods of payment
There are a number of ways to pay all costs and fees:
- money transfer to the bank accounts of the vendor, the notaio, the estate agent, and any consultant. In our experience, this is the most usual way.
- the buyer can open a bank account in Italy and ask the Italian bank to issue bankers drafts.
- International Travellers Cheques on acceptance of both the parties.
The property price and the notaio fee have to be paid up-front.
Catasto (Land Registry)
Italian buildings and lands are registered at the Catasto office. Quite often the registration is not up to date or there may be alterations to be carried out before the contract. These applications have to be submitted by a registered professional, architect or geometra which we can provide.
To purchase a property, the buyer needs an Italian tax number, called Codice Fiscale. Foreigners can obtain a codice fiscale at the Italian Consulate.
You can download the form the following link: Codice Fiscale form for UK residents.
Other nationalities should apply to their local consulate.
This has to be submitted, together with a copy of your passport and an Italian address (usually the property which is intended to buy).
Under Italian legislation, the agency fee is due when a potential offer from a buyer is accepted by the vendor. Therefore, before the PCA. Some agents ask the buyer to sign a "Proposta Formale d'Acquisto". This is like a statement of intention to buy and it does not substitute the PCA.
The agency fee is registered on the rogito. Please beware of agents that ask not to be registered on the rogito. Usually this is because they have no license!