The procedure for buying a property in Italy may differ from other countries, but it is a logical process which foresees all verifications and checks undertaken by a notary whose specific role is to ensure the safe exchange of title deeds and completion.
If you’ve found a property you wish to buy, the very first phase is to reach an agreement on price. This will be negotiated by your agent. Once price has been agreed, your agent will also establish methods of payment and timelines between the initial deposit and the final notarised contract which is when you legally take possession of the property.
STEP 1 – FORMAL OFFER OF PURCHASE OR PRELIMINARY CONTRACT OF SALE
(proposta di acquisto irrevocabile o contratto preliminare di vendita/compromesso)
In order to facilitate sales where one or even both parties live overseas, Cortona International (CI) tends to begin with a formal offer of purchase that sets out everything that has been agreed and is made conditional to the results of your independent survey – which we strongly recommend you have done.
Generally speaking CI doesn’t request a down payment for this initial phase, but other agencies may request a 5%-10% binding deposit.
(This deposit, unless otherwise specified is non-returnable, so it is important there be a clause in the offer which states that should the findings of the survey be unsatisfactory, the deposit monies will be automatically reimbursed and the contract between the parties become null and void with no legal consequences to either party.)
With CI this is an automatic procedure, the offer being more than anything else, a letter of intent to buy/sell; establishing price, methods of payment and timelines for completion.
STEP 2 – Should the results of the survey be satisfactory, CI’s formal offer of purchase will automatically become a Preliminary contract of sale as and when the notary, chosen by the buyer, is in receipt of the following documentation and funds:
The down payment (caparra confirmatoria) which can be anything from 10%-30% (an amount agreed between the parties) is a non-refundable deposit unless otherwise stated in the Preliminary contract.
Should you withdraw from the sale because you are unable to fulfil the legal obligations cited in the contract, these monies would be forfeit i.e. the vendor would be entitled to keep them.
In the same vein, should the vendor be unable to fulfil the legal obligations cited in the contract, you would be entitled to the return of your down payment plus a penalty of the same amount.
Once the Preliminary contract has been signed it will be formally registered by the notary with the relevant authorities.
Monies payable at preliminary contract
Amount equal to the down payment (to be held in escrow by the notary until completion).
Registration fees - circa E.350
Stamp duty amounting to 0,5% of the down payment (which is deducted from the total due at final contract).
Translation fees if applicable (circa E.300-E.700)
Agency fees which are generally 3% + VAT of the agreed purchase price are also legally due at the signing of the Preliminary contract. CI’s general policy is to wait until completion before invoicing you, but other agencies may expect partial or total payment
STEP 3 – FINAL NOTARISED CONTRACT – COMPLETION
This usually takes place 2 or 3 months after the Preliminary contract, unless otherwise stipulated. The Final notarised contract, once undersigned by both parties, gives you the legal possession of the property.
If you are unable to be present in person for the final contract you will require a power of attorney.
Doing a power of attorney is simpler if done in Italy with the notary who is presiding over the sale.
It costs circa E.180 + translation costs of E.150 and can be done in 1 hour.
If you are unable to draw up a power of attorney in Italy, you will need to acquire one from a notary in your country of residence. The POA will then need to be legally translated, authenticated by the relevant government authorities and given an Apostille.
The final contract is done only when the notary has ascertained that the property has not been used as collateral for any loans and that there are no outstanding taxes to be paid.
It is the owner who is legally responsible for the compliancy of the property and declares its conformity in the contract (hence the importance of having a personal survey done to have this verified).
Monies payable at the Final notarised contract
· the balance of the purchase price,
· the remainder of the purchase taxes/stamp duties (less the 0,5% already paid)
· the notary’s fees and the agency’s fees.
After the signing of the Final Contract, the contract will be transcribed and registered by the notary in order for the title deeds to be officially transferred into your name.
CI will immediately change all utilities into your name and alert the local council to the change of ownership.
COSTS NORMALLY INCURRED WHEN BUYING A PROPERTY
IMPORTATION OF FUNDSThere are no restrictions on purchase monies being imported into Italy, but to ensure that proceeds of any resale can be repatriated, we advise you to obtain official documentation of the importation of these monies and any incidental costs. Monies for the purchase of a property must arrive via bank transfer from regulated banks which are not on any Black List!
LAWYERSWhile some international lawyers may well be versed in Italian law, few international lawyers are versed in the buying of private properties deep in the countryside and far from the big cities where their law firms generally practice. Even fewer will be versed in local planning laws, regulations and restrictions which change from region to region and even from one local council to another.
NOTARIESWhat one should know when buying a property in Italy is that all contracts can be stipulated in front of a Notary (who is specialized in house sales and technically speaking, higher up the legal ladder than a lawyer).
We strongly recommend you carry out a survey before committing to buying a property. We can either recommend a geometra or are happy to work with one of your own choosing. A survey costs, on average, between E.500 to E.1000 + IVA depending on what needs to be verified.
A compliancy report should verify:
• that the property conforms to all town planning and building regulations
• has permissions for any/all works undertaken
• is registered correctly at both the Land & Building registry
• has (where applicable*) compliant gas, electric, plumbing, sewage and heating systems
With this in hand a purchase can be done swiftly in a matter of 1-2 months.*Older and more rural houses will often not comply to today’s regulations with regard to electric, plumbing, sewage and heating systems. In these instances, a clause is inserted into both the preliminary and final contracts stating that the buyer is aware of the condition of all utility systems and exonerates the owner from any future responsibility.
The survey should also include the following:
• The structural condition of the property
• That all utilities are certified and/or attached and functional (water, sewage, electricity, gas, boiler)*
• Pool and pumps functional
• If there are any disputed access roads
• If there are rights of use/rights of way on or through the property
• The property has been de-ruralised and is a civic habitation
• Condition of the roof
• Condition of doors and windows
• Damp assessment
• Compliancy of gas installation (GPL tank or mains), both inside and outside the houseShould there be some doubt as to the property’s structural soundness, an engineer could be hired to do a full structural survey. This can be quite costly, depending on what technical measures need to be undertaken, but at least you would have an informed idea of what problems the property might present, should you choose to buy it.
CONDITIONAL CONTRACTS OF SALECortona International requests a compliancy status report from all of its vendors before marketing a property. This doesn’t mean a property is necessarily compliant, but it means we have a clear idea of the irregularities which need to be regularised and the timelines in which this can be done.
CLAUSES TO INSERT
The CI team will always ensure you are fully aware of all pros and cons before committing yourself to any purchase. We are also more than happy to make introductions to English speaking geometras, lawyers and notaries with whom you can consult directly.