How to buy a house in Italy | Auction

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Have you every wondered how to buy a house in Italy at auction?

As an international law firm dealing mostly with cross border property transactions, clients often reach out to us and ask How to buy a house in Italy. 

Buying Italian property at auction could turn out to be a good opportunity to purchase a property for a reasonable price. You could make savings of up to 60 % compared to buying a property on the market.

While buying at auction may have advantages, it is certainly not without risks. It is therefore essential to engage the services of a technical-legal advisor to carry out due diligence.

In order to mitigate or, at least contain the risks that may arise from the purchase, due diligence should start with the determination of the most likely market value of the property and conclude with thorough verification of all the legal, building, planning, cadastral and administrative aspects.

Due diligence is especially important in forced sales, which lack any guarantees against defects.

How do Italian property auctions work?

In general terms, a property auction is a competitive sale. It begins with the presentation of one or more bids with the transfer of ownership going to the highest bidder.

There are two kinds of property auctions in Italy.

1. Disposal of public assets, which follow specific legal rules.

2. Those of a judicial nature.

The latter applies whenever assets owned by a natural or legal person (known as the execution debtor) are seized. These assets then become subject to a forced sale. The expropriation procedure forces the sale of assets by a third party (the executor judge or a delegate). The objective is to liquidate the execution debtor’s assets and maximise the revenue from the sale in order to repay, in whole or in part, creditors.

How to participate in an Italian real estate auction?

There are two types of property auctions in Italy:

SEALED-BID AUCTION

In this case, participants electronically submit their irrevocable and binding bids by 12:00 a.m. on the day prior to the opening of the bids. The Portale delle Vendite Pubbliche — Public Sales Portal is now the predominant system for electronic bids. Bids may also be in sealed envelopes that must meet a number of requirements specifically indicated in the auction notice and on the websites of the courts. In order for both types of sealed bids to be valid, they must be accompanied by a deposit amounting to at least 10% of the offer price.

OPEN ASCENDING-BID AUCTION

The sale by open ascending-bid auction is not used very often. It provides a secondary and possible method of auction. It is however usually only used in case of an unsuccessful sealed-bid auction.This type of auction is generally only used when it is considered possible to obtain a rather improbable figure, i.e., a price higher than half of the value of the property.

Participants must publicly make at least one bid that is higher than the last declared price. The auction closes when at least three minutes have elapsed since the last bid.

Important things to consider when you buy house in Italy at auction

If you wish to take part in an auction, we advise you to seek legal assistance. This will safeguard you as well as provide support with all the preparatory and subsequent phases of the sale, in particular with regard to the following.

1. Starting price of the sale (the base price at which the asset is for sale).

2. Bid increments (minimum increase in the raise set by the executor judge).

3. Security deposit (minimum amount to pay in order to take part in the auction).

4. Date of the sale (when the auction takes place).

5. Availability of the property (state of the property: if it is vacant and/or subject to constraints such as sitting tenants; the property may be occupied by virtue of a lease or a loan agreement and so on).

6. Town-planning- cadastral compliance of the property.

7. Place of the sale (auctions used to be in the courts or courts of appeal, but as of 2018 they are now mostly and preferably held online on dedicated online platforms; it is, therefore, necessary to register and access the, “Portale delle vendite pubbliche” of Ministry of Justice).

Finally…

At De Tullio Law Firm, we have over 55 years of experience managing all types of Italian property transactions. We have in-depth expertise in Italian and international legal systems and processes.

There are many potential pitfalls and legal ramifications to consider when buying Italian property at auction. We would always recommend that you seek independent professional advice before participating in an Italian property auction.

Buying Italian property at auction can be a good way to buy a property provided you do it safely. For more information on how to buy a house in Italy at auction, please get in touch.

Property in Italy. Advice for Buying, Renovating And Selling.

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When buying a property in Italy, it’s essential to think about the long-term consequences. Do your due diligence and follow all legal protocols to avoid potential problems.

We thank our clients who agreed to share their experience of buying, renovating, and selling property in Italy. Their responses provide valuable insights for anyone considering an Italian property investment.

What attracted you to buy property in Italy?

“We didn’t initially intend to buy a property in Italy…

We were invited to stay with friends who had a house in a small Italian village. We saw a house in the same village that had been empty for about 16 years and just decided to buy it! We contacted the owners and one of them showed us around the property. We wanted to use the property as a shared holiday home for the four of us, who are friends. Although the house needed a lot of work, we thought it could be a fun project. “

 Our Advice?

  1. We would advise that before making any decisions about purchasing a property, it is important to thoroughly research the local real estate market and understand the costs and legal requirements involved in buying and owning property in Italy.
  2. Online advice can sometimes be misleading or even incorrect. It would be wise to consult with an experienced real estate agent and a lawyer, as well as a contractor who can provide an estimate for any necessary repairs or renovations.
  3. Additionally, if you are planning to buy property as a shared venture, it would be a good idea to discuss and establish a plan for managing and maintaining the property among friends.
  4. It’s also important to consider the long-term plan for the property, such as what to do with it when no one is using it.
  5. Ultimately, it’s important to weigh all the factors and determine if the project is financially and logistically feasible before proceeding with the purchase.

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Can you tell us how you bought your property in Italy?

“The purchasing process was hit and miss… 

We were put in touch with people by the friends we had stayed with. However we quickly found that translation was a big issue. The estate agent proceeded to put us in touch with a notary who insisted we understand everything. Our entire property purchase team consisted of the Estate agent, property a consultant the notary and translators. We did not engage a lawyer.”

Our Advice?

  1. Prioritise finding a real estate agent or a property consultant who is fluent in the same language as you to avoid any confusion or misunderstandings. Be aware that real estate agents facilitate the search for an Italian property. However, Italian real estate agents have no legal obligation to undertake searches of a technical or legal nature (due diligence).
  2. Engage a lawyer who speaks your language and can guide you through the whole legal process, ensure your rights are protected and review all the necessary documentation.
  3. International clients are often confused about the role of an Italian Notary. There is a mistaken belief that a public notary (notaio) performs the same function as a lawyer, solicitor or attorney (avvocato). This is not the case. Italian notaries act on behalf of the Italian State whereas a lawyer, is someone you engage to act exclusively on your behalf in a legal matter.
  4. Have a clear plan of how to communicate with your team in Italy in order to ensure everyone is on the same page and to avoid any confusion.
  5. Make sure to ask for clarification and confirmation of any important information or details that you don’t understand.
  6. Take your time with the process and don’t rush into any decisions. Make sure you fully understand all the terms and conditions before proceeding.

Did you buy the property alone or with others?

“The purchasing process was quite complex..

We are 2 couples and we came to a friendly agreement to have all names in the deed of sale. All owned a quarter each. All decisions had to be unanimously decided by all four. We found the overall purchasing process different to the UK. Quite complex and it took roughly 9 or 10 months to complete.”

Our Advice?

  1. Prioritise communication and organisation among the co-buyers. Having a clear plan and decision-making process in place will help ensure that the process runs smoothly.
  2. Research and understand the legal requirements and procedures involved in buying property in Italy. The laws and regulations of Italy vary significantly from other countries. It’s important to be aware of them before signing any paperwork. You can read more about this here.
  3. Consult with a local lawyer who has experience in property transactions in Italy. This will ensure that all legal requirements are met and that parties’ rights are protected.
  4. Be prepared for the process to take longer than you might expect. It’s important to be patient and allow enough time to complete all the necessary steps.
  5. Make sure to keep accurate records of all transactions, agreements, and communications throughout the process to avoid any potential misunderstandings or disputes among the group.
  6. Keep in mind that buying a property as a group can be challenging, especially if all decisions have to be made unanimously. It’s important to have open and honest communication, and to be willing to compromise when necessary.
  7. Prepare for unexpected costs and have a contingency plan in place.

Did you undertake any renovations once you owned the property in Italy?

“The house was in need of complete renovation…

The property had no certificate of habitability. Someone in the village recommended a geometra who organised the renovation with local builders. The geometra didn’t speak English but his daughter was a solicitor who translated everything for us. At the time we believed all the planning permissions and paperwork had been taken care of. However when we came to sell the property we found out that was not the case…”

Our Advice?

Buying and renovating a property in Italy is a common scenario. It is also a common scenario for these projects to end in heartache. Unfortunately, we often don’t meet these buyers until after they have purchased a property. They have usually spent way more than expected and then need help to fix problems. Overall, it’s important to be well-informed, organised, and to work with professionals who have experience of renovations in Italy. This will ensure that the renovation process goes smoothly and that you are later able to sell the property without any issues.

  1. Be sure to obtain certificates of habitability and energy efficiency when buying an Italian property. If the property does not have either certificate, make sure you understand the long term implications of this.
  2. Prioritise obtaining all necessary planning permits, licenses, and approvals before starting any renovation work. It’s important to be aware of all the legal requirements and regulations and to make sure that the work is in compliance with them.
  3. Work with reputable and licensed contractors and tradespeople, who are familiar with regulations and have experience with the type of work you need.
  4. Engage a lawyer to draw up a detailed contract with the contractor. A lawyer can also help you understand and communicate with the geometra and other professionals involved in the renovation process, if you don’t speak Italian.
  5. Keep accurate records of all agreements, invoices, and receipts.
  6. When buying a property in need of complete renovation, it’s important to have a realistic budget. Additionally you should plan a contingency for unexpected costs.
  7. Prepare for unexpected issues to arise during the renovation process and have a plan in place for how to address them.

What made you decide to sell your property in Italy?

“We decided to sell the property… 

We had planned to spend more time but personal circumstances at home didn’t allow it. For numerous reasons. The covid pandemic didn’t help. When we were there, there was always lots of work to do in the garden and the house. It was fun going but it never felt like a holiday. Getting older, we did not want to risk creating problems for our children in the future should something happen to us. After owning the property for 15 years we decided it was time to sell it.”

Our Advice?

  1. If you’re buying or already own a property in Italy, it’s important to plan ahead for its future ownership. Estate planning is an ongoing process that should be reviewed and updated as your family and circumstances change. Failing to take the right steps can lead to family disputes and complications after your death. Consider consulting a lawyer for guidance on how to best manage your Italian property.
  2. When considering selling, a lawyer can ensure that all necessary legal paperwork and permits are in order before listing the property, which will speed up the sales process and increase opportunities to reach prospective buyers.

Can you tell us about the sales process of your property in Italy?

“The property sales process was straightforward. 

When it came to the sale of the property, on a friend’s recommendation, we engaged De Tullio Law Firm. We gave De Tullio Law Firm power of attorney. The team were able to do everything for us. The overall process took about a year because when preparing the listing, De Tullio Law Firm discovered missing permits, certificates, etc… We then needed to acquire retroactive planning permission, which took a few months. Once all the documentation was complete and correct, the house sold very quickly”.

Our Advice?

  1. Selling your Italian property can be a complex and time-consuming process. To ensure a smooth and successful sale, prepare and organise all the necessary legal documents and paperwork before listing it.
  2. Paperwork includes the title deeds, land registry entries, building permits, certificate of habitability,  energy performance certificate (APE) and a certificate of urban destination (CDU). Having these documents readily available will speed up the sales process and increase the property’s appeal to potential buyers.
  3. To make this process easier, it is advisable to seek the assistance of a lawyer who is familiar with the Italian property market and regulations. Your lawyer can provide a pre-sales service to ensure that all the paperwork is in order before listing the property for sale. This can also include handling the marketing of the property and representing you if you are unable to travel or make multiple trips to Italy.
“The overall experience of buying and owning a property in Italy was a life changer. Overcoming legal challenges and completing renovations led to amazing times at the house. We had great neighbours, friends, and support from the village. Our property partners were fantastic, discussing everything and sharing 15 memorable years with us. 
If anyone is considering doing a similar project, I would say just follow your heart. As long as you take the sound advice by De Tullio Law firm, you will be well guided throughout the process. “

Finally …

De Tullio Law Firm is your go-to for expert guidance and support when buying, owning, or selling Italian property. We have over 55 years of experience in Italian and cross-border property, family, and inheritance matters. Our team provides comprehensive and personalised service to ensure your property transaction runs smoothly.

Trust us to handle the legal complexities and help you navigate the often-challenging Italian property market. Contact us today to schedule a free preliminary consultation.

 

You may also be interested in our Guide to Building And Renovating Property in Italy.

You might also like our info videos about Italian property, succession and family law.

Buying An Italian Property. A Short Guide

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This short guide aims to cover the key elements of the Italian purchasing process

For a more in-depth explanation, you may wish to read our comprehensive Italian Property Buying Guide.

Buying an Italian property proceeds through 3 key stages:

– Proposta irrevocabile d’acquisto (Reservation offer)

– Contratto preliminare di vendita (Preliminary contract)

– Atto di vendita (Deed of sale)

Once you have chosen your property you should engage the services of a solicitor, whether you buy through a real estate agent or directly from the vendor.

The knowledge that an Italian solicitor has about Italian real estate law is invaluable – plus, your own solicitor is there exclusively to look after your interests.

The first stage. Reservation offer

When buying an Italian property, the first document you will have to sign is a, “proposta irrevocabile d’acquisto” (reservation offer). This is normal practice when purchasing through an estate agent

In contrast, when purchasing directly from the seller (a private sale) a reservation offer is unusual. The implications of dispensing with a reservation offer is one of the many reasons why you should seek legal advice.

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By signing the proposta irrevocabile d’acquisto, you secure the removal of the property from the market for a limited period of time, normally 15 days.

It is important to highlight that a reservation offer is only binding upon the buyer when formal written acceptance of the offer has been received from the vendor. Once the agreement has been signed by both parties, it becomes a legally binding contract.

First deposit

You will need to pay a small deposit, which is normally held by the estate agent or solicitor until the vendor has formally accepted the reservation offer.

Should you finalise the purchase, this deposit becomes a part payment of the purchase price. If the seller does not formally accept the offer, your deposit will be refunded.

Due diligence

While the property is off the market, your solicitor, assisted by a surveyor, will make all the necessary searches to ascertain that the property doesn’t have any debts, mortgages, claims etc. Due diligence checks and searches ensure there will be no unpleasant and possibly costly surprises during or after the purchase.

The second stage of buying an Italian property. Preliminary contract

Normally at this stage, buyer and seller having agreed to go ahead with the conveyance, will formalise their agreement through a “contratto preliminare di vendita” (preliminary contract)

Some estate agents (and especially in the case of private sales) choose, or recommend, leaving out this part of the purchase process. However, this legal document really is essential. It sets out the detailed terms and conditions of the sale.

Estate agents often use boilerplate preliminary contract templates. These may not be suitable for your personal situation. Your purchase may be subject to certain terms and conditions. For example, you may have come across some structural issues during due diligence and want to make your purchase contingent on a surveyor’s report. This condition would need to be in the preliminary contract. A solicitor can draft the contract, or at least to examine the estate agent’s template and advise you on any implications before you sign it.

Second deposit

One of the essential legal elements of the preliminary contract is the payment of a deposit (caparra confirmatoria). This is normally equivalent to a minimum of 10% of the purchase price.

If you back out of the contract without a valid legal reason, you will lose this deposit. On the other hand, if the seller changes their mind about the sale, they will have to refund your deposit in full. You would also have the right to claim an amount equal to the deposit through the Italian courts.

In the preliminary contract, the parties also set the date to finalise the conveyance in front of the public notary.

The third Stage of buying an Italian property. Completion of the sale

By law a notary must oversee Italian property transactions. The notary is a public official who has State authority to validate contracts transferring the ownership of a property. The notary is also responsible for paying all land registry fees and cadastral taxes.

A notary must remain absolutely impartial

A notary may not therefore offer legal advice to any party involved in a property transaction. The notary cannot therefore act as a substitute for a solicitor in terms of representing the interests of the buyer.

In order to ensure you have proper legal safeguards, the only way is to engage the services of an independent solicitor. Only by having your own solicitor, can you be confident that no unpleasant surprises will be revealed at this late stage of the purchase process.

Deed of sale

Buying an Italian property concludes with the, “atto di vendita” (deed of sale).

The deed of sale is drafted by the notary and has to be fully compliant with the preliminary contract. In other words, the preliminary contract dictates all the essential elements of the transaction.

Translation

Should any of the parties not understand the Italian language, Italian law requires a translation of the deed of sale. Unless you have an Italian solicitor who speaks your language, the notary may also require that a qualified translator be present at the signing.

Unlike a translator, the advantage of having a solicitor with you is that should any last-minute legal issues arise at the signing, your solicitor will be able to immediately resolve these.

You should be aware that the Italian version of the deed will prevail in a court of law if any issues arise at a later stage.

Signing day

On the appointed signing day, all parties to the transaction convene, usually at the notary’s office. The notary reads the deed aloud and all parties then sign it in front of the notary. Once signed, the buyer pays the balance of the purchase price to the seller and the new owner receives the keys of the property.

New owners can collect a copy of the deed from the notary approximately one month after the signing. It takes approximately one month to register the deed at the relevant land registry office.

If the buyer cannot be present to sign the deed of sale in front of the notary, the buyer can give a power of attorney to their solicitor. This will permit the solicitor to sign the deed of sale on the buyer’s behalf.

Finally …

As a general rule, it is wise to familiarise yourself with the legal framework regulating international property sales.

For over 55 years, De Tullio Law Firm has been providing international clients with independent legal advice throughout Italy. We are specialists in cross border property, inheritance and family law.

If you would like further information about buying an Italian property, we are here to help. We can guide you through the whole process or even organise the whole process on your behalf. Get in touch with us for a free preliminary consultation.

Buying an Italian property. Glossary
  • Proposta irrevocabile di vendita: An initial formal offer with a small deposit. It contains the price you are willing to offer and any conditions.
  • Contratto preliminare di vendita: This contract sets out, in detail, the terms and conditions of the sale and also all the relevant cadastral and land registry information. Also called a, “Compromesso”.
  • Caparra confirmatoria: Italian Civil Code regulates this deposit under art.1385 of the. If a deposit is defined as a “caparra confirmatoria” its payment gives rise to legal rights and obligations on both parties.
  • Atto di Vendita: All parties sign the deed of sale in front of a public notary. The buyer makes outstanding balance of payment and receives the keys to the property. Also called a, “Rogito”.

Renovating A Property in Italy. A Short Guide

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Renovating a property in Italy is a complex process requiring a wide range of competencies

Renovating a property in Italy means making sure all the work meets legal requirements. Otherwise, you run the risk of criminal prosecution.

Before renovating a property in Italy, do your homework

Obtaining legal assistance will make the entire renovation process easier and crucially, ensure that all legal requirements are met in a timely manner.

Legal support can save you money and mitigate the risk of criminal liabilities and prosecution.

 

If you would like to talk to us about your Italian property, please get in touch with us.

 

Legal due diligence is key

Before you buy a renovation project in Italy, it is vital to do some in-depth research about the property. This legal due diligence step verifies, amongst other things, the compliance status with municipal planning and land registry documentation.

At De Tullio Law Firm, we offer a complete range of services to assess the legal situation before you purchase a property or before you start renovation work.

Firstly, we can check that the current (de facto) condition and the official (de jure) condition of the property match all the documentation lodged with the cadastre. Secondly we can search for all the planning and building permits lodged with the Municipal Technical Office and check these are in order. Thirdly, we can ascertain from municipal records that the entire property – including any additions and outbuildings, have all the relevant planning consents.

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Without the above, you will not be able to obtain authorisation to commence renovation works. Renovating the property will require that you apply for the relevant permits issued by the local municipality.

Buying to renovate

Once you are sure that the property meets legal requirements and structural specifications and if you have decided to proceed with the purchase, having a legal professional on your side will be helpful in negotiating the property price and ensuring the purchase goes smoothly.

Choose a specialist property lawyer with expertise in building law and regulations. Bear in mind that if down the line, you undertake any work that is not legally compliant, you run the risk of prosecution. In Italy this can mean a protracted, costly matter and will obviously require legal services. In the long run, it may be more cost-effective to budget legal services from the outset of your project.

Steps involved in renovating a property in Italy

Design and Planning

Once you own the property, technical experts – a surveyor and/or an architect – assess its de facto condition and design the renovation work.

Plans must meet provisions of current legislation, with particular regard to energy efficiency and sanitation regulations.

You will also need to respect zoning and planning regulations in the design.

In order to draw up suitable tenders,  you should make a complete list of materials and finishes at the design phase.

Building quotes

Subsequently, you will need to choose a building company to carry out the work.

This step involves submitting the executive project – drawn up by your surveyor or architect – and the above-mentioned specification list of the works to at least three companies. In this way, you have a comparison to help choose the most competitive and suitable offer.

Usually, for refurbishment, there are three types of companies involved (construction, electrician, plumber).

To simplify management of the work, it is advisable to contract only one company, who will then sub-contract the work. It is vital to check that your chosen building company conforms with Italian fiscal requirements, in particular through the DURC (Documento Unico di Regolarità Contributiva), a document proving that the company makes social security contributions on behalf of its employees.

In order to avoid conflicts of interest, it is advisable to nominate a project manager unrelated to the building company.

Building contract

The next key step is to draw up a detailed contract between yourself and the building company. This is an area that requires a thorough understanding of the law. Your building contract guarantees your legal protection during and following the completion of your building work. The contract is of paramount importance, especially if you need to seek legal recourse at some point. You should ensure that your contract is legally binding and specifies the building company’s duties.

Tax incentives

It is also advisable to check what tax deductions and/or funding is available. Even if you have already started renovation work, incentives periodically become available.

Building permits and starting renovations

You will need to officially declare the property owner, project manager and building company and apply for the relevant building permit. Your local municipal technical office is responsible for providing a building permit. When you have received the relevant authorisation, building work can commence.

A Safety and Coordination Plan (Piano di Sicurezza e Coordinamento) must be drawn up pursuant to Legislative decree 81/08, and a Safety Coordinator (Coordinatore della Sicurezza in fase di Esecuzione) must be appointed to supervise the building procedure. The building company must comply with the terms specified in this document as well as draft its own Operational Safety Plan (Piano Operativo di Sicurezza, POS). All waste produced on the construction site must be properly managed and treated in compliance with local disposal laws.

Signing off

Once work is complete, you will need to have everything assessed, inspected and approved. Then the cadastral value of the property needs updating in the land registry and you can apply for a certificate of habitability.

Finally …

Are you considering renovating a property in Italy? Are you experiencing problems with a renovation project in Italy? If you would like support or further information, our legal professionals can help. We can make your project easier by guiding, advising and protecting you through the entire procedure. Reach us at info@detulliolawfirm.com.

 

We offer a free preliminary call to address your questions and provide insights tailored to your specific situation. The consultation is entirely free of charge and serves as an opportunity for us to offer guidance based on your unique needs and circumstances.

To schedule a convenient time for our discussion, you may use the booking link provided here: https://calendly.com/detulliolaw/15min.

 

You may also be interested in Building a House in Italy: a short step by step guide.

You may also like to watch our useful info videos.

Selling Your Italian Property. A Short Guide

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Selling your Italian property can be a difficult and lengthy process 

To aid the process in the long run, it is therefore important to make things easier at the outset. Prior to selling your Italian property there are certain preparations that are worthwhile making.

Preparing a sales package

The first step is to gather all the legal paperwork relating to the property.

Amongst other things, this includes the title deeds which prove you are the legal owner. Also, land registry entries to show that the whole property has planning permission and complies with building regulations. In addition, the property’s certificate of habitability and energy performance certificate.

Having this paperwork before you start marketing the property will facilitate the whole sales process for you as well as potential buyers.

Marketing your Italian property

The next step is putting the property on the market. You can either do this as a private sale or through a real estate agent (agente immobiliare).

If you are appointing an Italian real estate agent, it is important to ensure that the agent is qualified and registered with the local Chamber of Commerce in full compliance with Italian law. Legislation governing real estate agents aims to guarantee professional qualification. An unregistered agent could be prosecuted for carrying out a reserved activity and may not be legally entitled to request commission. Legislation also ensures that the agent has adequate indemnity insurance to cover clients in the event something goes wrong.

It’s important to think about whether the real estate agent can market the property locally, nationally and internationally. Perhaps ask a few agents to appraise the property. And, be sure to discuss brokerage fees before you choose.

Checking Italian real estate agent terms and conditions

Usually, both the buyer and the vendor pay the estate agent commission. Estate agent commission is negotiable but is generally equivalent to 3% of the full sale price. Amongst other aspects, it is important to assess the agent. In particular, their brokerage fees, minimum sale price, duration of the mandate and their exclusivity.

Get Your FREE Guide to Selling Property in Italy

Our PDF guide covers every aspect of the selling process so you're ready to put your property on the market with confidence

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Frequently, real estate agents require a foreign seller to sign standard terms of engagement. The seller must carefully evaluate this before signing. All the more so if the document is in Italian. Even with the translation of the terms of engagement into your language, the Italian version will prevail.

Reservation offers in Italy

Once a potential buyer is considering the purchase of your property, the potential buyer will generally sign a legally binding document called, Proposta Irrevocabile d’Acquisto, a Reservation Offer. Often the buyer makes a small deposit to the vendor at this point.

Both the buyer and the property vendor should sign the reservation offer. In effect, the reservation offer removes the property from the market for a period of time, usually 15 days. This allows the interested buyer exclusive rights to conduct due diligence on the property.

Property checks and searches in Italy

Due diligence includes: conducting surveys, planning and building application/permission searches, local authority and land registry searches, and legal searches.

This is where preparing your sales package before marketing your property comes into its own.

The aim of due diligence, amongst other things, is to establish that the property exists in relevant records. In other words that it is as described, and the seller has the right to sell the property in question.

That there are no mortgages/charges or any third party rights or other undisclosed encumbrances affecting the property.

The property complies with all local planning and building regulations and complies with any relevant local authority urban plan.

That the property is fit for human occupancy, unless the property is selling for reconstruction, and that the owner holds the relevant certification of habitability Certificato di Abitabilità.

The seller has complied with all the relevant Italian tax legislation by lodging tax returns, and paying tax. This includes tax which may have been due in the previous tax years. In default of this requirement, the property may be legally unsaleable.

That where the vendor is the owner of a company, the vendor is not insolvent. In addition, no application to this effect should be pending against the owner; 

That where the property is in a block of flats, the vendor is up to date with all service charges due.

Make sure the preliminary contract fits your buyer’s specific needs when selling your Italian property

Having a tailored preliminary contract will facilitate your sale. Often estate agents use a standard form for this, but this may not meet your buyer’s specific circumstances. What happens, for example, if your buyer is purchasing subject to getting a mortgage? Make sure you cover all the bases to ensure that selling your Italian property doesn’t become more protracted than it needs to be.

Conditions precedent in a preliminary contract protect all parties when buying and selling property in Italy. However, to provide protection, conditional clauses must actually be written into the preliminary contract in order for them to be legally binding.

Selling your Italian property: completing the sale

This usually takes place in the offices of a notary (Notaio). In Italy, sellers and purchasers often use the same notary to oversee the transaction. However, you are perfectly within your rights to have your own notary.

The notary will draw up the deed of sale based on information contained in your preliminary contract.

Liability relating to an Italian deed of sale, involves not only the selling and buying parties but also the notary. Failure to disclose all relevant facts about your Italian property represents a complex legal matter which can have far-reaching consequences.

Finally …

For more detailed information about selling your Italian property, we have prepared a free Guide to Selling Property in Italy. 

If you are thinking of selling a property in Italy, why not talk to us? We offer a pre-sales service. This ensures that all the legal sales-related paperwork is correct before you put your property on the market.

De Tullio Law Firm can advise and guide you throughout your Italian property selling journey. We have over 55 years of experience working with clients on their Italian and cross border property, family and inheritance matters. Get in touch.

 

You may also be interested in Selling Property in Italy. A Short Guide.

You may also like to watch our info videos regarding Italian property law.

New Build Warranty in Italy

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Buying a new build home in Italy should mean you encounter fewer problems than you would with an older property. Unfortunately, that’s not always the case. If you purchase a newly built property, or a property that is under construction, you want reassurance that the builder will fix any issues with your new build property. If problems occur, a new build warranty should help.

What is a new build warranty?

Legislative Decree No. 122 of 20 June 2005 introduced new build warranties in Italy. A new build warranty is essentially a ten-year indemnity insurance policy for newly built homes or property projects that are under construction. The warranty is taken out by the builder or developer but is in place to protect you, the buyer.

In Italy, a new build warranty typically covers you for any construction and material defects and direct damage to the property, as well as damage caused to third parties. The policy takes effect from the date of completion of construction work.

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When is a new build warranty mandatory in Italy?

The obligation for a builder or developer to provide a new build warranty exists exclusively for:

– Purchases of new build properties and construction projects by private individuals (art. 1 paragraph 1 a) Legislative Decree 122/2005). It does not therefore apply if the purchaser is, for example, a company.

– For real estate that is subject to a preliminary contract signed prior to the completion of construction. In this case, the promissory purchaser will need to show the new build warranty to the notary appointed to draw up the Deed of Sale.

Ministerial Decree No. 154 of 20 July 2022, which came into force on 5th November, 2022, stipulates that the notary must verify the details of the warranty, acknowledging its compliance with Italian legislation.

In particular, with the recent introduction of the new build warranty standard template, the notary must verify the existence of the following essential elements:

Annex A. This is the Standard Form (Schema Tipo) of the warranty. The clauses it contains constitute the minimum content of the ten-year new build warranty pursuant to Legislative Decree 122/2005;

Annex B. This contains the Technical Datasheet (Scheda Tecnica) which serves the sole purpose of simplifying the policy activation procedure. It contains the main identification information of the parties and the scope of the insurance cover. The Technical Datasheet forms an integral and substantive part of the contractual agreement.

Annex C. This is the Certificate of Compliance (Modello di Attestazione di conformità). It serves to certify that the new build warranty complies with the standard template. This is in order to comply with Article 4 paragraph 1-quater pursuant to which, the deed of transfer of ownership must contain the identification details of the new build warranty and the certificate of compliance.

What if there is no new build warranty?

Failure to issue a new build warranty at the time of the transfer of ownership constitutes grounds for invalidating the sale and purchase agreement. Withdrawing from the purchase can only be exercised by the purchaser (it is in fact a ground for relative invalidity).

Moreover, as a result of the amendments introduced by Legislative Decree 14/2019, in addition to possible action to void the sale, the purchaser has the right to enforce the warranty in the event of a breach by the builder, provided that the purchaser notifies the intention not to proceed with the completion of the transaction (art. 3 paragraph 3b of Legislative Decree no. 122/2005).

Finally …

Buying a property in Italy is always exciting, but when your new Italian home is a new build, it’s extra special. You’ll be the first to make the property a home, having everything exactly as you would like it to be. But before you buy, you’ll want to check that all the building work and related paperwork is correct. At De Tullio Law Firm, we have decades of experience specialising in Italian property law. Get in touch and let us help you make your Italian new build property purchase safely.

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.

Abuso edilizio (Unauthorised Construction) in Italy

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Abuso edilizio (Unauthorised Construction) in Italy is not uncommon

Abuso edilizio, or anauthorised Construction, in Italy is a common issue that you might have encountered if you have bought, or are in the process of buying, an Italian property.

What constitutes unauthorised construction in Italy?

In general terms, unauthorised construction occurs when someone makes changes to a property without obtaining legally required permission.

Depending on the seriousness of the offence, a range of sanctions is applicable. There are three categories of unauthorised construction offences in Italy.

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1) Total violation

Work without a building permit or where the work is in total breach of permission. In other words, there is no permit or the building completely differs from the provisions of the permit.

2) Substantial violation

This is work that substantially diverges from the building permit. The work comprises significant qualitative and quantitative differences compared to the authorised project.

3) Partial violation

Here, work partially deviates from the building permit. That is to say, although the work has authorisation, it is not in accordance with the permit.

Unauthorised construction in Italy is a criminal offence

All of the above violations are criminal offences. As such, they are subject to criminal prosecution as well as sanctions. Building offences are punishable not only with administrative sanctions but may also involve arrest and a fine.

In some cases, where someone has unlawfully developed land not zoned for construction purposes, a judge may order the confiscation of the land and property. The land and property therefore become the property of the local municipality and owner receives neither compensation nor damages.

Article 44 of the Consolidated Law on Construction (Presidential Decree no. 380/2001) provides for fines ranging from a minimum of €10,328.00 to a maximum of €103,290.00 depending on the type of offence. In addition, offenders may receive a custodial sentence of up to two years.

Remedial action is possible

For example, you may have increased the volume of your property or carried out renovation work without following the legally required administrative procedure. Or, perhaps you have inherited a property along with zoning and cadastral discrepancies. In both cases legal remedies are available.

Regarding total and substantial violations of building permits you will need a, “Permesso di Costruire in sanatoria”. This may provide an amnesty (condono) which regularises the property. However, this remedy is not applicable to properties in heritage zones or on land in zones where property development is unlawful.

The process of obtaining a Permesso di Costruire in sanatoria is both complex and costly. It involves paying the municipality the normal fee to obtain a building permit to start a new construction project. In addition, penalty payments may amount to double the fee for a building permit. Precise amounts are set by the Italian Regions in accordance with the Consolidated Law on Construction.

A CILA offers a retroactive remedy for partial violations. CILA stands for Comunicazione Inizio Lavori Asseverata (Notice of commencement of certified works). It is a notice you must submit to the municipality prior to undertaking non-routine work on a property. For example, work that does not change the structure of the building but impacts internal layout.

If you submit a CILA once work has started or after the work has finished, this is a CILA “in sanatoria”. Because it is a communication after the event, it entails a fine. €1,000 if the work is already complete and a penalty of €333.33 euros if the work is still in progress.

Finally …

The Office for Italian Statistics (ISTAT), estimates that nationally, some 20% of Italian properties constitute unauthorised constructions. Even more in the southern regions of Italy. On top of these statistics, many properties partially violate legal requirements. For example, they comprise an unauthorised outbuilding or extension.

When you buy an Italian property, it is impossible to tell if there is any unauthorised construction work just from viewing it. To avoid issues such as finding your property is difficult to sell or even unsaleable later on, you should check municipal planning and zoning records and land registry files to ensure that the whole property has all the relevant consents.

The key to making your Italian property project as safe and smooth as possible is to appoint a legal team that speaks your language. De Tullio Law Firm has a thorough understanding of Italian property law and decades of experience managing Italian property transactions.

Get in touch with us: info@detulliolawfirm.com

You may also be interested in Italian Property: Who Is Liable for Defects in Building Work in Italy?

Certificato di Abitabilità – Certificate of Habitability

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What is a certificato di abitabilità?

A certificate of habitability, or a certificato di abitabilità in Italian. This is a document that validates the suitability of a residential property for human habitation.

The certification is issued by local municipal offices. It follows verification that the building and its systems comply with health, safety and building regulations.

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According to Italian law, prior to issuing this certificate, the competent authorities should also verify that the building complies with planning permission.

The case law of the Italian Supreme Court is unanimous. In property transactions, the vendor must supply a certificate of habitability to the buyer. Furthermore, the vendor must give the document to the buyer before, or at the latest, at the signing of the deed of sale.

“The vendor of a property intended for residential use has a duty to deliver to the buyer the Certificate of Habitability without which the property is unmarketable”. (Cass. 23rd January 2009, n. 1701).

A buyer has the right to verify that the property is suitable, that it is useable and will be saleable at a later date. Because it has direct effects on the legal use of the property as stipulated in the contract, a certificato di abitabilità is an essential requirement for all properties.

Does a lack of a certificato di abitabilità consitute a breach of contract?

Unless otherwise stipulated in contractual agreements, the responsibility to provide the certificate of habitability belongs to the vendor. Where there is a delay or a failure to supply the certificato di abitabilità, there is a clear case of non-execution of a contractual obligation (breach of contract).

Where no certificate of habitability exists, a buyer can still buy the property. However, the buyer must expressly consent to the lack of certification. In addition, the lack of certification must be included in the notarial deed of sale. The onus is on the buyer to verify the existence of the certificate of habitability before completion. It should form part of the buyer’s legal due diligence.

Finally …

If you are looking at a real estate investment in Italy, why not talk to us? De Tullio Law Firm can advise and guide you throughout your Italian property purchasing journey. We have over 55 years of experience working with clients on their Italian and cross border property, family and inheritance matters. Get in touch.

 

For more information, you may find our buying and selling property in Italy guides useful.

Procura. Applying A Power of Attorney in Italy

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Unable to travel to Italy? Do you need to set up a procura?

Do you need to deal with Italian legal matters but you cannot travel to Italy in person? The solution may be to confer a Power of Attorney. This is known as a procura in Italian.

How does an Italian procura work?

A Power of Attorney (PoA) is a legal instrument. It allows someone (an agent or attorney) to act on behalf of someone else (the principal). A procura specifies exactly what powers a principal gives to an agent.

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Generally speaking, if you use a PoA for an Italian property transaction, it is not advisable to grant a PoA to a real estate agent.  This is to avoid any conflicts of interest. As estate agents work on a commission basis, they may have a vested interest in making the sale.

What are the different types of procura in Italy?

There are two types of PoA in Italy.

Procura speciale

The principal gives limited powers to an appointed agent. The agent can only conduct specified tasks on behalf of the principal. For example, for an Italian property purchase, if you cannot be in Italy to complete the sale, you can grant this power to your appointed agent who can then sign the deed of sale on your behalf.

Procura generale

The principal grants a wide range of powers to their agent. In effect, the agent can do almost anything the principal could do.

The principal can revoke either type of PoA at any time.

Does Italy recognise foreign Powers of Attorney?

If you draw up a PoA in your home country, you will need to take steps to get it recognised overseas. To do this, your PoA will require an apostille.

Apostilles certify official documents for international use. Apostilles are valid in all jurisdictions that are signatories to the provisions of the Hague Convention (1961) on the mutual recognition of documents.

Italy, the UK, the USA and Australia are all signatories to the Hague Convention. In the UK, you can obtain apostille services through the Foreign Commonwealth & Development Office. The U.S Department of State is responsible for apostilles in the U.S.A and in Australia you should contact the Department of Foreign Affairs and Trade.

Finally …

A PoA is a sensitive legal matter. You are entrusting the management of some or all of your legal and financial affairs to someone else.

You should only appoint someone you are confident will act responsibly in your interests, has the necessary skills and is competent, reliable and willing to act for you. We therefore recommend that you confer your Power of Attorney on a professional such as a solicitor.

While you are waiting for formalisation of an apostille, we are able to check the validity of signatures. We can provide a provisional confirmation that these appear genuine.

Before you prepare a PoA applicable in Italy, it is worthwhile seeking legal advice from a cross border legal specialist. If you would like to discuss your situation, please get in touch with us at info@detulliolawfirm.com

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Apostille for Italy: What is an Apostille?

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How can you ensure official documents are recognised abroad?

If a document is intended for use in another country, you may require a formal recognition in the form of an apostille. The procedure is generally described as a “legalisation” although it is sometimes referred to as “consularisation”. In order to use an official document overseas, you may therefore require an apostille. What exactly does this mean?

In this article, we are going to explain apostilles and how you can go about getting them.

What is an apostille?

Firstly, an apostille is a stamp that is placed on a document by a designated competent authority. The stamp should read, “Apostille” and confirms that an official source has issued your document and that the receiving country can accept the document as authentic.

Secondly, the Hague Convention (1961) governs mutual recognition of documents between signatories. Therefore, apostilles are valid in countries that have adopted provisions of the convention.

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The information in an apostille follows a prescribed format

1. Country of issue

2. Who has signed the document

3. The capacity in which the person signed the document

4. Details of any seal on the document

5. Place of issue

6. Date of issue

7. Issuing authority

8. Apostille Certificate number

9. Stamp of issuing authority

10. Signature of representative of issuing authority

What type of documents require an apostille for use abroad?

All apostilles are similar. However, not all documents are processed in the same way. There is a wide variety of documents that may require an apostille. It is therefore important to prepare properly and submit the correct version for authentication with an apostille.

For example, you may require apostilles for documents of an administrative nature such as, birth, marriage and death certificates or a grant of probate or a power of attorney.

If you are, for instance, doing business overseas, you may require an apostille for official documents. These might include extracts from commercial registers or other registers; patents; notarial acts such as property titles; notarial attestations of signatures. If on the other hand, you want to study abroad, you may need an apostille for school, university and other academic diplomas.

Where can you obtain an apostille?

This depends where your document originated so check that and then apply for an apostille in the issuing country.

Signatories to the Hague Convention designate who can deliver apostilles. For example, in the UK, the Foreign Commonwealth & Development Office provides apostille services. In the USA, the U.S Department of State is responsible. In Australia you should contact the Department of Foreign Affairs and Trade.

The authorities in the receiving country may require a translation. In this case, you will need to get the translation of your document certified rather than the original document. Depending on requirements and the type of document, you may need a translation by a sworn translator.

As the subject of apostilles can be somewhat complex, the Hague website has published a useful brochure, which includes a FAQ: The ABCs of Apostille

Finally …

If you need support with an apostille for Italy, please get in touch with us. While you are waiting for formalisation of an apostille, we are able to check the validity of signatures. We can provide a provisional confirmation that these appear genuine.

For over 55 years, De Tullio Law Firm has been providing international clients with independent legal advice throughout Italy. We are specialists in cross border property, inheritance and family law.

 

You may also be interested in Power of Attorney