Top Tips for Finding Property in Italy

Italy is such a stunning nation that really sells itself to visitors and requires little in the way of additional publicity from websites like this!  That said, how can we not talk up the lure of the stunning Italian coastline, the fabulous cities, the rolling or mountainous rural interior, the delightful people, exquisite cuisine, fascinating history and robust housing market?

It is the property market that we will be focusing on today in this, our top tips for finding property in Italy, because for many people Italy is the dream, but finding a dream property can be more like a nightmare!  What happens is that, more often than not, people don’t apply the same business minded approach to buying property abroad as they do when buying back home.  In this article we will provide you with tips to keep you on the right track when house hunting in Italy.

You can divide the process of finding property in Italy into four distinct pieces…firstly you consider the location, then you consider the property type, then you have to look at financing and fees and finally, you have to make it happen according to your terms!  Easy!  So, let’s get started…

First things first you need to determine which area of Italy appeals to you and also your reasons for buying a home in Italy.  If you’re buying as a jet-to-let investment property, your home needs to meet your potential tenant’s expectations and furthermore, it needs to be within easy reach of international transport links.  Current common thinking is that if an overseas property is more than 100km from the nearest airport, it is too far and will not rent easily.

If you’re buying as a personal investment and you will be using the home as a holiday, retirement or even permanent relocation property, consideration relating to the location will be swayed more by your own personal tastes, dreams, preferences and desires.  It is at this point we need to make an important point – you have a dream, and there are dream sellers out there in every foreign property market in the world.  These people will see you coming, they will see your vision of the dream is actually clouding your judgement, (sorry for the mixed metaphors), and they will sell you your dream by managing to package any old rubbish into that which you know you desire!

Why does this happen and how does this happen? 

Well, the ‘why’ is simple I’m afraid, it’s because certain unscrupulous types exist everywhere and are greedy.  The ‘how’ is also fairly easy to explain.  If you combine a house-hunting trip with a property exploration exercise you are going to have your leisure-time and relaxed hat on whilst considering entering into a business transaction.  Therefore you will not be in the right frame of mind for making calculated and careful decisions.  In a former article I described it as ‘people leaving their brains on the plane’ when they travel abroad to buy property!  So you have slightly less astute than normal, slightly vulnerable home-buyers in a land in which they are less familiar and these people can be targets for less than totally honest people.

So, to ensure you do not fall foul of this nightmare scenario you absolutely have to be cold, calculating and careful!  The first stage is therefore, carefully selecting the region/s of Italy that you want to buy in.  You can conduct much due diligence and research remotely from books, magazines and of course the internet, but eventually you have to spend a certain amount of time in the location you are interested in to ensure it is all that you expect.  This is why we always recommend that you actually rent abroad in your favoured location if you are thinking of buying for permanent relocation.  You can give yourself plenty of time to familiarise yourself with the area, get to know the real prices that properties sell for, maybe even make some useful contacts.

Once you are certain about the location, the next consideration is property type.  This may be determined by your budget, your personal preferences, the likely preferences of any tenants or a number of other personal factors and you can help yourself quickly discount and consider properties sent to you by agents by creating for yourself a definitive list of likes and dislikes, must haves and must have nots!  It’s a great and fun exercise to write out all that you desire in a property – but it is equally important that you list factors that would discount a property from your viewing list.  This will not only save you and an estate agent a great deal of time, it will help your focus the mind when you begin viewing Italian real estate.

So, with a location and an ideal property in mind, you can now get budgetary issues sorted.  Have a look at your budget – have a look at the amount of deposit you have, the amount you would like in a mortgage and then examine with the help of a mortgage company or brokerage the amount you can borrow.  Get a loan agreed in principle and then add this to your deposit to have a definitive figure of the amount you can spend.  From this you have to deduct all likely fees, taxes and charges to leave you with a net figure which can be used for your property purchase.

You need to know that the fees charged for a house sale and purchase in Italy are among the highest in Europe and they can of course change annually or according to that which you are buying and where.  So, speak to estate agents and your lawyer up front about all associated and likely costs.  As a guideline from which you can work you will probably encounter the following: -

Registration Tax of between 0 and 10%
Land Registry Tax of between circa EUR 130 and 1%
VAT of between 4 and 20%
Mortgage Fees which include fees and taxes
Notary Fees which depend on the selling price of the property – the lower the price the higher the percentage of that price a notary will charge
Conveyancing Fees of between 1 and 2% including 20% VAT
Estate Agent Commission of between 3 and 8%

On top of this, if you have any surveys done, call in an architect or builder etc., these people will all charge you and you also have to pay for the connection of utilities.

That’s the bad news out of the way!  Hopefully after calculating the amount of fees you will pay on your preferred property type based on current median prices for the location you are looking at in Italy you are left with sufficient money in the pot to proceed to purchase.  To proceed you should appoint your own independent lawyer and allow them to guide and counsel you through the purchase process.

And finally in this article about top tips for finding property in Italy, remember, do not sign any form of contract until you are 100% certain you are ready to proceed as you can lose any deposits paid if you do sign and then pull out.  Furthermore, ensure clauses are written in to the contract that say you can withdraw from the sale if your mortgage application fails and/or something is found to be amiss with the property or the deeds during searches and surveys.