De Tullio Law Firm in Fortune Italia Magazine

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De Tullio Law Firm and luxury real estate in Italy

In the April 2019 edition of Fortune Italia Magazine, De Tullio Law Firm contributed to a discussion about the state of the luxury real estate market in Italy.

A world apart

The luxury real estate market in Italy is booming – indifferent to market fluctuations. Who buys luxury properties and furnishings?

Italy’s Luxury real estate market sector “is less exposed than other property segments to economic conditions. The uniqueness of the Italian offer, which is inextricably linked to our architectural, landscape and cultural heritage, represents a strong element of attraction”, says Giandomenico De Tullio, Managing Partner at De Tullio Law Firm. The company provides legal services in the Italian luxury real estate market – mainly serving US and UK clients.

Italy’s luxury property market is particularly healthy. Compared to the same period in 2017, the first half of 2018 saw an increase of 26.73% in real estate transactions in excess of 900 thousand euros. Real estate of more than one million euros saw 1,028 properties sold compared to 865 in the previous year. This represents an increase of 18.84%.

De Tullio Law Firm: we are specialists for cross border property law throughout Italy

Generally, we are talking about properties that mainly appeal to international clients, which De Tullio calls, ‘High Net Worth Individuals’. ” This is a clientele with high expectations that demand high levels of competence and professionalism”.

Choosing a property

In the main, investors are foreign so they often need a guide. Perhaps they don’t know Italy very well, or are unfamiliar with the dynamics of its real estate market.

Lionard, is one of the most important players at national level in the luxury real estate sector. The company is involved in the buying and selling process. They have a real estate portfolio of 13.32 billion euros. The average value of real estate for sale is 5.01 million euros.

Lionard has bases in Florence, Milan and – soon – Rome.

The company currently represents 51% of Italian properties with a value of more than 3 million euros. “The real estate market historically follows the macro-economic trend of the world’s major markets,” says Ian Heath, real estate advisor at Lionard. “For this reason, the sector has also faced and suffered from the economic crisis over the past decade. However, the luxury real estate segment, in terms of the type of clientele and internationality of the audience it addresses, is able to offer growth beyond what is happening on a local economic level”.

A growth that Lionard capitalises on with satisfactory results. “In terms of real estate portfolio, we are the first real estate operator to have over 2,500 properties offered for sale directly by owners. With regards to the company’s balance sheet, we were the first among Italian luxury sector real estate operators, to achieve a turnover of over 9 million euros with an EBITDA of over 60%”. In 2018 alone, Lionard properties valued at 106.5 million euros changed hands.

Of course, to impact such a market, the right tools are a pre-requisite. In addition to the professionals who make up the team, “the pearl of the company is undoubtedly our management system. This is the primary national resource in terms of the luxury market in Italy”, says Heath. “We cross-reference the most in demand areas and the most desired types of property with current data. This provides our target audience with a survey of more than 45,000 properties nationwide. More than 2,500 of these are officially for sale. This helps the customer to form an independent idea of all the options available”.

The right decor

Once you have purchased a luxury home, you need equally luxurious furnishings. Pasquale Natuzzi Junior Says, “high-spending clientele is undoubtedly different. It is a group of consumers for whom it is necessary to transform the purchase into a unique experience.” Pasquale is creative director and stylist at Natuzzi.

The business started life in Puglia in the ’60s. It has since become one of the few Italian companies listed on Wall Street. Natuzzi totalled 449.6 million euros of turnover in 2017 and is present in 123 markets worldwide. Pasquale Natuzzi Senior, who is still company president, founded the company.

Natuzzi enjoys recognition as the “most famous lifestyle brand in the world in the premium furniture sector”.

And, according to Pasquale Junior has built its success, “thanks to our identity, our style and our product offering”.

In addition, the luxury consumer scene appreciates, “dealing with contexts where quality of service is everything. This is  especially relevant in our sector, where cooperation with customers can continue for several months. It is important to offer an experience that goes beyond a simple visit to the store: it is a relational investment that requires time, trust and competence”.

Harnessing this market sector naturally requires special business skills, which enable, “the customer to entrust the whole process to the company”. The shop team, according to the creative director, “is engaged in customer projects that can last well over six months”.

Success depends on the ability to transmit to the customer a dedication and professionalism, taking care of every aspect of the project. An approach that is only possible, “thanks to the continuous training and development of our sales staff, evolution of our collections and investments in our points of sale. In our stores we have reliable, well-prepared professionals, with a solid background in the design sector, perfectly able to interact with our clients, an architect or an interior designer. For highly sensitive projects, we also involve other professionals (colour experts, technicians specialised in 3D modelling, 3D, designers). Experts who can provide further support at the definition phase of a project”.

Finally… De Tullio Law Firm on Fortune Italia magazine

Please, contact De Tullio Law Firm for a free preliminary consultation if you would like to discuss your property purchase or you would like further information about our services.

For over 55 years, we have been providing legal services to clients at an international and local level, gaining a strong reputation for quality, expertise, and professionalism.

You may also be interested in Buying Property in Italy

Title deed and deed of sale. Change of Names.

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Registering names on a title deed in Italy

The final step of the Italian conveyancing process is signing of the deed of sale. In effect, the title deed in Italy transfers ownership of real estate into someone’s name.

This legal procedure demands the presence of a notary public, the real estate vendor(s) and buyer(s) and two witnesses.

The notary reads aloud the entire deed, which is written in Italian. All parties, including the witnesses and the notary public, then approve and sign the title deed.

If one of the parties to the transaction is not fluent in the Italian language, Italian law requires the presence of a qualified professional to translate and interpret the title deed. This could be a translator or a bilingual property lawyer. This legal requirement aims to ensure that all parties fully understand the content and ramifications of the deed. The professional acting as translator must also sign the title deed.

Once the notary has signed-off on the deed, the buyer acquires ownership of the real estate.

Subsequently, the notary is responsible for certain formalities. Because notaries work for the Italian State, registering the deed with the tax authorities is the first step. Next the notary lodges the deed in the Public Registers. This allows any third parties who may have an interest to know about the change of ownership. Lastly, the notary informs the land registry so they can update their records accordingly.

How do you change the name on an Italian property / title deed?

There are many reasons why you may need to change the name on a title deed in Italy. Divorce and death are the most common reasons.

In order to change the name on a title deed, you will require a new notarial deed.

For example, if you acquired a property with a spouse and following a divorce you need to remove one of the names from a real property title deed, you will need a new notarial deed.

Where the divorce decree is from an Italian Court, the transfer of ownership will not involve payment of any real estate transfer tax.

If on the other hand, the divorce decree is issued by a non-Italian Court, you will have to pay real estate transfer tax.

The terms of the new title deed determine applicable tax rates. It will depend whether the real property changed hands without any payment or if there was a financial transaction involved. In the latter case, you will need a new deed of sale.

How do you find out whose name is on a title deed in Italy?

In order to find out whose name appears on a title deed, you will need to conduct mortgage and cadastral searches.

Finally …

For more information and clarification on title and sale deeds in Italy, please do not hesitate to contact us. We are here to help you.

You may also like to read: Translating legal documents in Property Transactions

Italian Luxury Property: Legal And Fiscal Definitions

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What is a luxury property in Italy?

From a legal and fiscal perspective, the Italian luxury property category of real estate includes castles as well as certain types of property such as historic villas, mansions and palaces.

Before you sign any paperwork relating to a property, you should check its legal and fiscal category.

If you need advice on any aspect of managing property searches and checks in Italy, we can help.

Legislation relating to Italian luxury property

Italian law specifies purchase tax and annual municipal tax rates on luxury properties in Italy.

Contrary to what many think, luxury homes are not exclusively large properties – in terms of square meterage. Real estate location, cultural value and the quality of finishes also determine the classification of a property.

Buying a luxury property means that as a purchaser, you will not be able to take advantage of certain benefits relating to property registration tax.

Furthermore, once you own the property, you will not qualify for municipal tax deductions and exemptions.

Italian law uses two sets of guidelines to determine luxury property: Ministerial Decree 2/8/69 and cadastral criteria.

Get Your FREE Guide to Buying Property in Italy

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Luxury properties: Ministerial Decree 1969

According to this law, the definition of luxury real estate means a property must meet precise criteria. It must have at least one of the characteristics set out in the Ministerial Decree 2/8/69. These include: properties in areas which, according to town planning and zoning laws, are for villas or private parks.

Single-family homes, which sit on building plots of not less than 3,000 square meters. This category excludes agricultural areas, even if planning provides for the possibility of building residential properties.

Single-family homes with certain types of sports facilities. In particular, the law refers to swimming pools with a minimum area of 80 square meters and to tennis courts on drained ground extending to at least 650 square meters.

Single dwellings with a surface area of more than 200 square meters, excluding balconies, terraces, cellars, attics, stairs and parking spaces, that have an open area of land more than six times the covered area.

Individual real estate units with a surface area of more than 240 square meters excluding balconies, terraces, cellars, attics, stairs and parking spaces.

Properties on land where the value of the land exceeds the value of the property by at least one and a half times.

Even if a property does not have any of the above characteristics, there is a table attached to Ministerial Decree 2/8/69. This table states that a property can belong in the luxury property category if it has at least four characteristics among a list of finishes.

Specifications are complex and for the avoidance of doubt, we would advise you to seek independent legal advice.

The Ministerial Decree of 1969 is quite exhaustive in defining the characteristics of luxury homes. However, Italian legislation governing cadastral classifications also contains important indications.

Luxury properties: cadastral classification criteria

Article 33 of Legislative Decree 175/2014, assesses the cadastral classification of Italian properties. Its use is almost exclusively limited to assessing property tax rates. In particular for principal residences (prima casa).

For cadastral purposes, luxury properties are those belonging to the following categories:

A/1: stately homes – classical buildings with above-average finishes in areas considered valuable due to the presence of parks and/or gardens.

A/8: dwellings in villas. These are residential properties with fine finishes set in a park or a garden.

A/9: castles, palaces and mansions of outstanding cultural and historical and value. These mainly consist of single real estate units.

Italian properties belonging in these categories are luxury properties. Owners cannot therefore benefit from tax benefits and/or tax exemptions.

Finally …

Italian Luxury Property: a Legal and Fiscal DefinitionFor over 55 years, De Tullio Law Firm has been providing international clients with independent legal advice. We offer services in all the major fields of Italian law with particular expertise in real estate, inheritance and family law matters. Get in touch: info@detulliolawfirm.com

 

You may also be interested in Italian Property: Cadastral and Zoning Compliance

Building A House in Italy: A Brief Guide

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Purchasing the right plot of land when building a house in Italy is crucial

Self building, or having a house built, in your own country can be daunting enough. However, when it comes to building a house in Italy things can get really tricky.

If you decide to build a house in Italy, you will be subject to stringent building approvals and regulations.

Building work carried out in breach of approvals or that do not comply with regulations, expose you to criminal charges and prosecution. Court cases in Italy are protracted and costly procedures.

Non-compliances will also impact the future saleability of the property and, in a worst-case scenario may even lead to a demolition order.

You will need to deal with many professionals and legal restrictions. Building a house in Italy requires a deep knowledge of Italian law, technical aspects and working with building companies and contractors.

There can be many pitfalls along the way and we strongly advise you to seek legal advice before you even start looking for a building plot.

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Get your team in place

Involve professionals from the get go. This will make the whole procedure easier.

In addition to an architect and builder, engage a lawyer. This will give you more confidence in the building procedure since your team will guide you through what is a very complex project.

What are the steps to building a house in Italy?

Firstly, check before you buy. Can actually build on a specific plot of land and if so what size property can you build? You can ascertain this information from the land registry, certificates of intended use and, by investigating the presence of any restrictions related to zoning and urban planning.

Secondly, get your architect, surveyor, engineer to design the property. This should take into account current legislation regarding energy efficiency and any incentives available.

During this phase, we would recommend you define, in detail, a list of materials and finishes. You should then start getting estimates from construction companies or builders.

Thirdly, you will have to apply for planning and building permits and/or appropriate authorisations. The application needs to go through your local municipality. Depending on the municipality, permission can take several months.

How can a lawyer help with building a house in Italy?

Essentially a lawyer will safeguard you, your project and finances by ensuring that everything complies with Italian legislation.

In the first instance your lawyer can run checks and searches for you.

For example, so as to eliminate the risk of choosing a company that may become bankrupt during your building project, a solvency check on potential building companies is vital.

In order to have genuine benchmarks, your lawyer can request quotations from a number of building companies. Usually, for new construction, there are at least four different types of companies involved, (excavation, construction, electrician, plumber), but for easier management, it is advisable to contract the works to one company that will sub-contract the work. This is important in order to have only one point of contact on-site.

It is mandatory to check the building company you engage is tax compliant. Your lawyer can check DURC (Documento Unico di Regolarità Contributiva). This shows whether the company is in compliance with employees’ social security contributions.

Your lawyer can provide project management services. In order to avoid any conflicts of interest, you should avoid nominating a project manager related to the building company.

It is essential to have a legally drafted building contract. This is critical as it ensures you have all the legal guarantees and protections throughout your build and beyond. Again, your lawyer can manage this for you.

What needs to be in place before building can start?

Building works can only commence once you have nominated a project manager and building company and you have received all the relevant permits and documentation from the Municipal Technical Office.

A Safety and Coordination Plan (Piano di Sicurezza e Coordinamento) must also be in place, pursuant to Legislative decree 81/08.

A Safety Coordinator (Coordinatore della Sicurezza in fase di Esecuzione) must oversee the building phase. All the companies involved in the building phase must comply with the provisions of health and safety regulations. In addition they must prepare their own Operational Safety Plan (Piano Operativo di Sicurezza, POS).

Waste management produced on the construction site is particularly important. All materials must be disposed of in accordance with local regulations.

Finally …

As you can see, building a new house in Italy is not a straightforward process. Relying on our legal expertise and knowledge of Italian building laws and regulations will give you certainty and peace of mind.

Should you need further information concerning the process of building a new house, please feel free to contact De Tullio Law Firm at the following email address: info@detulliolawfirm.com.

 

You may also be interested in Insurance Policy for Off-Plan Properties.

You may also like to watch our info videos about Italian property, succession and family law.

Illegal Construction in Italy (abuso edilizio)

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Do you own an Italian property that completely or partially lacks planning permission?

Illegal construction in Italy is not uncommon. The Office for Italian Statistics (ISTAT), estimates that nationally, some 20% of Italian properties are completely illegal builds.

On top of these statistics, many properties are partially illegal. For example, an outbuilding or extension that doesn’t have planning permission.

Before buying any Italian property, you should conduct planning searches in the land registry and municipal planning records. It’s crucial to check that the whole property has all the relevant building consents.

Get Your FREE Guide to Buying Property in Italy

Our PDF guide covers every aspect of the buying process so you're ready to purchase with confidence

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If you are building a property in Italy, you should make sure that you have all the relevant permits and authorisations.

We advise that you seek independent legal advice to avoid the risks of prosecution and buying a property that is later unsaleable.

What is illegal construction?

Illegal construction, “edilizia abusiva” in Italian, is a crime.

If you make changes to a property without relevant consent or, you carry out building work which does not comply with permits, you are breaking the law.

Building work is also illegal if notification of commencement of work notice is missing (comunicazione di inizio lavori, CIL). This is a formal notification by the owner of the property to the municipality regarding the intention to make a change to the internal layout of a building.

There are several categories of illegal construction in Italy

Construction of an entire building without a building permit. This also applies to buildings on land in non-building zones.

An extension to an existing property without a building permit.

Work that diverges from the building permit issued.

A change of use to the property, for instance from business to residential use.

Any internal work without a required CIL notification.

Who is accountable for illegal construction work?

Those at risk of prosecution for Italian planning violations are the person named on a building permit if work is non-compliant with said permit.

Whoever commissioned the work. This may not necessarily be the property owner.

The builder or person who carried out the illegal work or the project manager may also be held liable.

It is also worth noting that if a new owner either commissioned or instigated the vendor to carry out certain illegal work prior to purchasing the property, both parties may be liable.

What are the risks of illegal construction in Italy?

The first possible consequence of commissioning illegal construction is the imposition of an administrative sanction. These vary according to the type of illegal work carried out. Possible administrative sanctions include a demolition order. This would entail removing all illegal building work and restoring the property to its original state.

If the municipality does not issue a demolition order, it may sequester the property and the owner will be given a fine. This will equate to the value of the illegal work or the estimated market value of the work.

Work that diverges from a permit or work done without a CIL notification is subject to a fine. Fines start at 516 Euros. However they can equate to twice the increase in the estimated market value of the property based on the work done.

Provided work complies with planning and building regulations in force at the time the work was carried out, it may be possible to apply for retrospective building permission.

The criminal consequences of illegal construction in Italy

Illegal building work is a criminal act in Italy. As such, it is therefore potentially punishable by arrest and a custodial sentence. More frequently however punishment involves hefty fines.

The penalties vary, depending on the type of crime committed and are in addition to previously mentioned administrative sanctions. More specifically, in the event of non-compliance with building regulations, town-planning laws and building permits, the fine is exclusively pecuniary – up to 10,329 Euros.

In the case where building work differs from a building permit, offenders could face a custodial sentence of up to two years plus a fine ranging from 5,164 to 51,645.00 Euros. Likewise if construction lacks a permit or, despite a work suspension order, work has continued.

Illegal construction on land with no zoning for building purposes can involve a custodial sentence of up to two years and a fine of between 15,493 and 51,64.00 Euros. The same penalty is applicable where illegal building work has been carried out in areas with historical, artistic, archaeological, landscape and/or environmental restrictions.

Finally …

Property buying in Italy is a serious investment. Italy has unique real estate laws and local customs. We recommend having the right team of advisors in place to make your purchasing experience successful. Should you need further information or help concerning illegal construction, please contact us.

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Elective Residence Visa for Italy

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An Elective Residence Visa allows non-EU citizens to reside in Italy

You should submit your application for an Elective Residence Visa (ERV) to the Italian embassy or consulate in your home country. For example, U.S. citizens can apply to the Italian consulates in New York, Miami, San Francisco. Canadians should apply to the Italian consulates in Toronto or Montreal.

The main requirement for obtaining an ERV is that the applicants must be able to support themselves autonomously in Italy. This must through an income unrelated to employment. Your income must be sufficient to exclude recourse to the Italian welfare system.

Get Your FREE Guide to Buying Property in Italy

Our PDF guide covers every aspect of the buying process so you're ready to purchase with confidence

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Applicants for an Italian ERV must be able to provide documented guarantees

According to Italian law, ERV applicants should meet two essential elements. Firstly, they must have somewhere to live in Italy. This can either be a property they own, or a secured tenancy with a contract.

Secondly, applicants must have an income stream. This should be approximately Euro 31,000 per annum. This income must continue in to the future – for the period of stay in Italy.

Verifying that an ERV applicant has somewhere to live is fairly straightforward. However, the assessment regarding adequate finances implies a so-called discretionary evaluation by the consulate.

By law, this assessment cannot be  arbitrary. In other words, the applicant must be able to see a logical explanation behind the decision-making process.

The law sets out various principles which the consulate should take into consideration when deciding whether or not to grant an ERV.

In particular, the available financial resources should be “ample”, “autonomous” and “stable”, thus the applicant should be able to sustain himself/herself without working in Italy.

The above means that financial resources should be fully accessible to the applicant. And, that funds should not be subject to unexpected, sudden fluctuations. The consulate must be able to make a reasonable assumption that an applicant’s financial resources will also exist into the future.

The applicant’s financial resources should originate from pensions, life annuities, ownership of real estate, ownership of stable economic-commercial activities or other sources of income. Income cannot however be from employment.

In the absence of any logical, valid and concrete reasons, so long as an applicant for an ERV meets the above requirements, the consulate cannot refuse to grant an ERV.

Finally …

Do you think your ERV application was wrongly rejected or do you need help with an ERV application?

The evaluation of the elements for an ERV application by the consulate is discretionary. However, as previously mentioned, it cannot be arbitrary.

Should you need further information concerning an elective residence visa or preparing your application or, if you wish to appeal the denial of an ERV, please contact us.

 

You may also like to read about what to do if your elective residence visa application is refused. We also have a series of info videos that you may like to watch.

Usucapione (Adverse Possession) in Italy

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What is Usucapione?

Usucapione (Adverse Possession) is a legal method of acquiring ownership of an Italian property.

There are two essential elements to  usucapione. Firstly, material possession of the asset, acting as the owner (as opposed to someone who received the right of use from the owner, e.g., by  means of a contract). Secondly, the passage of a specific period of time.

In the context of usucapione, possession should be peaceful. That is to say, possession should not have occurred through violent or clandestine means. Possession should also be continuous and uninterrupted over time. This means that possession should not have been intermittent.

Time is the essential element in usucapione. Italian legislation provides for 20 years for properties where possession is in bad faith and for other rights concerning usufruct, right of use, easements, etc. 10 years if the property is in good faith, that is, with a registered title deed by a party who was not the real property owner;

Uninterrupted possession must occur during the above mentioned periods of time. How does the law define uninterrupted? It means that possession should not be vacant for more than one year. For example, if the owner takes back possession of his asset for more than one year, usucapione is considered interrupted.

According to case law, it is compulsory to provide clear evidence concerning the start of possession. Very often witnesses play a crucial role.

Not all assets are subject to usucapione. State-owned property and/or public assets, for example, cannot be adversely possessed.

A case of usucapione?

For years a house had sat abandoned on the outskirts of a Sicilian village. Over a period of several years, starting in 1969, Giovanni started refurbishing the property. He moved in when he’d finished the renovation. Giovanni tamed the garden. He fenced it, established a vegetable plot and fruit orchard. Giovanni also fenced in some land abutting the property, where he keeps a few goats. Although he has no documents proving his title to the property, throughout the past fifty years, Giovanni has behaved as if owns the property.

Marie Louise is an American citizen who also has an Italian passport. She has presented a claim on the property. She asserts that she inherited the property from her grandfather and that she is therefore the rightful owner.

Is Marie Louise right about her claim? Or, has Giovanni acquired the property through usucapione?

How to organise a legal case based on usucapione:

The first step is to ensure you can evidence your right, specifically to have possessed the property, “uti dominus” (as if you were the owner of the property). Examples could be that you have rented the property, executed building work, etc.

Generally speaking, the role of witnesses is crucial. It is therefore essential to contact individuals who are prepared to give evidence in court.

Obviously, documented evidence is also important (for example, receipts regarding tax payments, invoices concerning building work, etc).

Compulsory mediation

Before starting a court case, it is imperative to apply for a compulsory mediation procedure with a mediation body (Organismo di mediazione) accredited by the Italian Ministry of Foreign Affairs. We recommend that you engage a lawyer to help. The application should indicate the parties involved in the procedure and the property subject to usucapione.

Where the mediation procedure results in a successful outcome, the agreement reached by the parties must authenticated in the presence of a notary public.

In case of a negative outcome from a mediation procedure, it is possible to then start legal proceedings in court.

Taking an usucapione case to court

Back to the above case regarding Marie Louise and Giovanni.

Marie Louise can sue Giovanni in court to reclaim possession and re-establish her full ownership of the property. The success of Marie Louise’s claim will depend on her ability to prove that she acquired the property by valid title and, that the property belonged to her predecessors by valid title prior to her inheriting it. In addition, if Marie Louise can prove that Giovanni’s holding has not been at the property in an uninterrupted manner or that she took proprietary action during Giovanni’s holding and therefore his acquisitive prescription is incomplete, Marie Louise may be able to reclaim possession of the property.

To challenge Marie Louise’s claim, Giovanni should use witnesses to testify that he renovated the house, fenced in the land and has worked the garden in a public, continuous and uninterrupted manner for the past fifty years. In effect he has treated the property as if he were the owner. If during the past fifty years, he has also had access to utilities (e.g., water, electricity) and has paid property taxes, Giovanni should be able to produce receipts to support his usucapione claim.

Finally …

If you own property in Italy, which you have neglected for some time, it is advisable to consult a specialist Italian property attorney to prevent any risks connected with ne (adverse possession). If you would like to discuss a case, please contact us for a free consultation.

You may also be interested in Usucapione – Safeguard Your Ownership Rights

Making An Italian Will. Information And Template

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A will determines distribution of your assets

By making an Italian will, you can decide how to divide your estate after your death. In addition, it allows you to be certain that your heirs don’t pay more Inheritance Tax than necessary.

What is an Italian Will?

A will is a legal document. The will writer, known as the testator, establishes in written form, how to distribute their estate after death (article 587 of Italian Civil Code).

Anyone over the age of 18, who is not legally incapacitated, can write an Italian will. Incapacity is defined by Italian Civil Code.

Italian law states that a will is revocable at any time. Testators’ rights to dispose of their assets is protected until their last breath.

The content of an Italian will is essentially patrimonial. That is to say, it deals with the distribution of a testator’s inheritable assets. However, the law states that testators can also make dispositions of a non-pecuniary nature in a will. For example, the recognition of a natural child.

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Why is having an Italian will important?

In order to understand how Italian inheritance law works, you may like to read our comprehensive guide on this subject.

If you own assets such as property in Italy, you should not underestimate the  importance of a will in Italian.

The laws governing forced heirship are very strict in Italy. Because of this, anyone wishing to derogate from these rules should seek legal advice in order to ensure their plans comply with Italian and European succession rules.

Not only does a will enable a testator to assign assets to beneficiaries, it can also be useful in preventing conflict among heirs. In certain cases, it can also permit a reduction in inheritance tax payments.

Because it makes life easier for those you leave behind, if you own property in Italy, we would advise that you make an Italian will.

How do you make an Italian will?

An Italian will must be in Italian. For an Italian will to be legally valid,  a testator must hand write, sign and date the document.

For straightforward cases, testators can use a very simple will format with wording such as this:

Io sottoscritto/a, …………………. (indicare cognome, nome, luogo e data di nascita, residenza) revoca tutte le mie precedenti disposizioni testamentarie. Dispongo del mio patrimonio al momento della mia morte come segue.

Nomino erede universale di tutti i miei beni terreni …………. (indicare cognome, nome ed eventuali rapporti di parentela. Se non si tratta di un parente, indicare anche luogo e data di nascita).

Cedo a ………… (indicare cognome, nome ed eventuale parentela, se non è un parente è opportuno indicare luogo e data di nascita) i seguenti beni: …………………….. (specificare chiaramente i beni).

Data

Firma

I, the undersigned, …………………. (indicate surname, name, place and date of birth, residence) herewith revoke all my previous testamentary dispositions. I dispose of my patrimony at the time of my death as follows.

I appoint as universal heir of all my worldly goods …………. (indicate surname, name and any relationship of kinship. If it is not a relative, you should also indicate place and date of birth).

I give to ………… (indicate surname, name and any relationship, if it is not a relative, it is appropriate to indicate place and date of birth) the following assets: …………………….. (clearly specify the assets).

Date

Signature

Finally …

Even if you think your situation is straightforward, it may not be. If you own property in Italy and elsewhere, this adds a layer of complexity. It will require cross border legal expertise. We therefore recommend that you seek independent legal advice regarding your personal circumstances.

At De Tullio Law Firm, we have over 55 years of experience managing cross border and Italian inheritance matters throughout Italy. We are a member of STEP, the world’s leading professional association for trust and estate practitioners.

If you would like to discuss your estate plan with us or if you are considering making an Italian will, please get in touch at: info@detulliolawfirm.com

 

You may also be interested in Do beneficiaries have to pay taxes on inheritance?

Homes for 1 Euro in Sambuca, Sicily (Italy)

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Is it true that there are homes for 1 Euro in Sambuca?

To combat dwindling populations and to attract Italian and foreign investors to revitalise their areas, a number of Italian villages, towns and cities, have launched charm offensives by putting a number of houses up for sale for the symbolic sum of 1 Euro. Dream homes for €1 in Sambuca is the latest 1 Euro property scheme in Italy. This is how the Sicilian Municipality of Sambuca is promoting tourism and highlighting depopulation issues. Sambuca is in the Province of Agrigento.

News of €1 property sales in Sambuca spread further through a CNN article on 18th January 2019.  Local officials say, “It’s not the first Italian town to lure in outsiders with tempting offers but, Sambuca is scrapping red tape to make sure any interested investors can more or less make their purchase right away”.

As opposed to other towns that are merely doing this for propaganda, this city hall owns all the homes for 1 Euro in Sambuca on sale,” says Giuseppe Cacioppo, Sambuca’s deputy mayor and tourist councillor. “We’re not intermediaries who liaise between old and new owners. You want that house, you’ll get it in no time.”

Are there any conditions attached to the purchase of homes for 1 Euro in Sambuca?

New owners must commit to refurbishing their choice of the crumbling 40 – 150 square meter dwellings within three years. Renovation costs start at €15,000 (about $17,200). Owners will also need to cough up a €5,000 security deposit that will be returned once the remodelling is complete.

With the population dwindling, Cacioppo says the town needs outsiders to prevent it from falling into ruin. “We can’t afford to lose our lovely Arab heritage. Luckily, foreigners are lending a hand in this rescue crusade.” (Source: CNN).

1 Euro houses at auction

As with all 1 Euro house schemes around Italy, sales take place in public auction (vendita con incanto).

It’s impossible to tell what you are taking on just from looking at a few photos of a property.

In some countries house auctions are common. In Italy however, they are not. There are no legal packs, which contain essential information including official titles and searches, property information and planning permission. In effect, you are responsible for conducting property-related searches.

To avoid buying what seems like a bargain but, subsequently turns out to be a money pit, you should inspect the property before deciding to make a bid.

Finally …

While €1 properties may seem like a great opportunity, buyer beware! Conditions always apply.

There are plenty of other reasonably-priced houses in Italy without the terms and conditions attached to €1 property schemes. These properties may be a better option for you because you can undertake renovation at your own pace and on your own terms.

Before making any type of property investment in Italy, you should seek independent legal advice on matters such as ownership titles, zoning, planning, structure and conditions of sale and purchase.

If you are considering buying a property anywhere in Italy for 1 Euro, or more, please free to contact us via email or fill in our contact form.

 

You may also be interested in How to get a mortgage in Italy

Buying A Property in Italy. Insider Tips from Our Clients

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In a recent survey, we asked clients what top tips they would offer to others buying a property in Italy. What would they recommend in order to ensure that Italian property purchases run smoothly? Here is a selection of replies, which we hope might be helpful if you are planning to buy real estate in Italy.

“Notaries and solicitors are not the same. The former works for the Italian State. The latter works for you …

Once the vendor has accepted your offer, it’s crucial to have the right people on your side.

We thought that because under Italian law you have to use a public notary, a ‘notaio’, we were protected from a legal point of view. However, we learnt that an Italian notary is not at all the same as having a solicitor. While a notary handles the conveyancing, they can’t give you any legal advice. In fact, Notaries are government employees. They are responsible for collecting all the relevant taxes you pay at completion.

In Italy, the vendor and buyer often share a ‘notaio’ but I’d advise you to appoint your own. Despite what anyone tells you, I’d recommend you consult a solicitor to advise you on matters such as price negotiations, checks and searches on the property, inheritance and how to structure your purchase and tax issues.

Choose the solicitor yourself, not someone the vendor or estate agent recommends. And, make sure the solicitor speaks your language and has experience of dealing with Italian property purchases and all the associated legal, estate planning and tax aspects”.

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“It’s not just about buying a property in Italy. Don’t ignore inheritance planning!

Under Italian law you have to leave a portion of your estate to your children (or your parents if you have no children), you can’t just leave all your property to whoever you want, whether that is your spouse or the local dog rescue centre.

Of course, there are ways around this, but they have legal and tax implications so it is important to seek professional advice if for any reason you don’t want to leave your Italian home to what are known as, “forced heirs”.

There are several ways to structure property transactions in Italy, which is great. However, you can’t change the ownership structure later on, so it’s important to consider the options before you buy. There are also inheritance tax implications so, again, getting professional advice before you sign anything is crucial”.

“You have to be smart with your cash.

Firstly, make sure you get your offer right. It’s surprising how many people who have an accurate idea of prices where they live will make an offer in Italy based on what they feel is right rather than market knowledge. It’s easy to research prices across Italy online on various property portals and agency websites. Your estate agent can advise you too. They also have a good idea of the price the vendor would be willing to accept.

We wanted complete peace of mind and preferred to have someone working purely on our behalf, so we asked De Tullio Law Firm to help us and they did an excellent job. They advised us all the way through our Italian real estate buying experience. They saved us a great deal of money negotiating a price for the property and sound legal advice. In addition, they helped put us in touch with foreign exchange specialists and helped us look in to taking out an Italian mortgage. We decided not to go down that route in the end but, it would have been an option”.

“Make sure your estate agent is qualified.

Italy has a well-regulated estate agency system. Buying a property in Italy is therefore pretty safe. Plus, it is easy to make sure your agent is one of the good guys. Check that your estate agent has professional insurance and is registered with their local chamber of commerce. Still, it’s a huge thing to sign legal documents if like us, your Italian is not great.

From personal experience, it’s a good idea to have a lawyer look over paperwork before you sign anything. Take care who you give your money to. Never give it directly to the seller – only to the notaio or to your estate agent so long as they are insured to take such payments. And never be tempted to pay ‘under the table’ to avoid taxes on the purchase by declaring a lower sale price. Even if you get away with it at the time, you will have to pay higher capital gains taxes when you come to sell as the difference between the price you paid (or declared you’d paid) and the price you sell at will be higher”.

“Although surveys are not common in Italy, that doesn’t mean you don’t have to have one.

We’re glad we had a survey done. When we were buying a property in Italy, our surveyor found quite a few structural issues and planning permission issues. Things that we couldn’t see just from viewing the property. We were able to use the issues to negotiate on the price of our house.

Make sure you choose an independent surveyor. Someone who understands the peculiarities of Italian buildings. Get a complete survey covering structural, zoning, building permits, termites, lead paint, asbestos, natural and industrial risks, gas/electrical/water installations, septic tanks and energy efficiency ratings. Because we were planning to renovate our property, we also asked a builder to look over the property”.

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“Renovations can be a great opportunity, but they can turn in to a money pit.

If you are looking for a renovation project in Italy, it is important to understand the likely costs and timescales involved, to avoid them spiralling out of control. Get at least a couple of quotes from builders before you sign for the property, and make a realistic plan for how you will proceed – will you use an architect and, or geometra, a project manager, Italian builders and artisans, or do the work yourself?

Planning permission is also key; get your lawyer to insert a condition into the preliminary sales contract (compromesso) stating that the purchase is subject to planning consents. We have renovated a couple of buildings in Italy, but wouldn’t have undertaken the projects without seeking legal advice beforehand”.

“Choose a reputable developer if you decide to buy an off-plan property in Italy.

Looks great on paper? A chance to design certain elements of your home? That’s what we thought but, buying an off-plan property in Italy is not for the faint-hearted. There have been so many stories of things going very wrong with off-plan real estate.

If you are thinking of buying off-plan, having your own lawyer is a must. Italian law is very complex and Italian legalese is a completely different language. It is crucial to establish that the developer is reputable before you sign any papers or hand over any money – do the developers have a bank guarantee for example? Bear in mind that in Italy developers won’t get funding from a bank until a certain amount of properties have been signed up, so check how far the development has progressed (has planning permission been approved or building work started?).

Never sign anything until you have taken legal advice and never ever hand over all the money at the start of the process, even if a developer is pressuring you. You should only make payments in stages. A final payment is only due once the property is complete.”

“On top of the asking price, you need to budget for additional costs.

This is really important to think about. Notary and estate agent fees can easily add up to 15% of the price of your property. Notary fees include various Italian State taxes like stamp duty as well as their actual fees, set on a sliding scale according to the value of the real estate. Estate agency fees are at the agency’s discretion. If you have a mortgage, don’t forget to account for mortgage fees as well. In addition, think about costs such as solicitor’s fees and surveys. Also think long term about property taxes, maintenance and running costs”.

“Do your homework before buying a property in Italy …

Read specialist magazines, consult websites – take care they are reputable though. Online advice can be a little misleading or even incorrect. Go to Italian property exhibitions and talk to experts there. Make sure you understand what you are taking on – not just the buying process and costs involved, but everything else. How will you get to your property? What are the running costs, including property taxes, utilities bills and service charges if you are buying an apartment?

Italy is a great place in which to buy a property – as long as you take care with your research beforehand and use reputable and registered professionals to help you”.

Finally …

If you are thinking of or in the process of buying a property in Italy and have a question,  please get in touch for a free consultation.

 

You may also be interested in How to get a mortgage in Italy