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A UK Nationals Guide to Italian Real Estate
Buying real estate in Italy, whether it is to live there, set up a business or rent, is beneficial in a number of ways. Italian real estate is renowned for being good value for money, with ideal tax breaks and a wide selection of real estate options. However, there are various elements that you need to be aware of, including mortgages, property tax and whether or not you can buy Italian real estate in the first place. Italian property laws and requirements differ from the UK, so it is important to make yourself aware of any dissimilarities between the two.
In this guide, we will explore the buying and selling of Italian real estate, whether you can achieve Italian citizenship through buying property, and who can buy Italian real estate. We will also discuss how you can apply for an Italian mortgage, various inheritance laws and property taxes, and why working with qualified Italian real estate Avvocatos (lawyers) can help you.
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Buying Real Estate in Italy
In order to buy an Italian property, there are various steps you must follow. Similarly to buying a property in the UK, you must find an estate agent. Seek out a property you can afford and organise a mortgage if one is required. You will also need to engage an Italian notary to help manage and draft your contract. Once you find a suitable property, you can make a formal offer; this is a legally binding contract, so it is important that you seek out Italian property lawyers to review any documents before they are signed.
Once a surveyor has completed their inspections, a preliminary contract (Compromesso) will be drafted, and a deposit of approximately 20% is required. The notary will draft your final contract, and you (the purchaser) will pay the outstanding balance, and the notary will pay the stamp duty to the Italian Government on the purchaser’s behalf. To buy Italian property after Brexit, you may need a non-EU national residence permit (permesso di soggiorno).
To find out more about buying property in Italy, please read our previous guide here.
How Can I Sell a Property in Italy?
When selling property in Italy, there are six key documents that the notary will require:
Visura catastale (cadastral document)
Atto di provenienza (ownership title)
Floor plan
Building permits, if the house was built after September 1967
Attestato di prestazione energetica (energy certificate)
Documents that identify both seller and buyer, such as passports and tax codes (your estate agent will provide you with a tax code for free).
A multilingual Italian lawyer can help you gather these documents. It can take around four to five months to sell a property in Italy.
It is advised that you contact a surveyor to assess the property and provide a report, as well as an estate agent who can help you sell your property. You should also organise a meeting with a notary, and provide copies of planning permissions and other relevant documentation.
To find out more, including any additional fees to be aware of, please refer to our previous guide.
Can you Get Italian Citizenship by Buying Italian Property
Buying Italian property does not automatically entitle you to Italian citizenship. However, if you choose to consider the Golden Visa programme, also known as the Italian Investor Visa, purchase of a property up valued at €500,000 or more is an investment that qualifies under the Golden Visa scheme.
Alternatively, for the investor visa, you can also invest either €2 million in Italian government bonds, €1 million in an Italian limited company, or €500,000 in an innovative start-up company. This visa can be extended for two years and renewed for three years. However, even if you don’t have citizenship, you can still buy Italian property. There are other ways to gain citizenship, such as by descent, marriage, naturalisation and adoption.
Who Can Buy Italian Real Estate?
There are no restrictions in Italy that would stop UK nationals from buying property as there is a bilateral agreement with Italy. If you live in a country that is not a part of the EU and does not have a bilateral agreement with Italy, you may only purchase property under a reciprocity rule; if an Italian can buy property in your country, you can buy property in theirs.
Italy has many benefits for potential property owners; the Italian government created a 110% ‘super bonus’ building scheme, which encourages people to renovate Italian properties. It is also a very straightforward and convenient for UK nationals.
How Can I Apply for an Italian Mortgage?
UK nationals can apply for an Italian mortgage. However, there are various requirements that must be met, including proof of income, an initial deposit, a valid passport, a bank statement and a clean credit history. There are primarily two types of mortgage interest rates in Italy; fixed rate and variable rate.
In order to apply for an Italian mortgage, there are ways in which you can help yourself and be prepared. You can conduct pre-application research, as well as check your credit score and engage a mortgage broker. You should also select the property you wish to buy, gather all the necessary documents, and submit your application, where it will then either be approved or rejected.
Some documents may need to be translated, so it is advised that you seek help from multilingual Italian lawyers. To find out more about applying for an Italian mortgage, you can read our previous guide here.
Italian Real Estate and Inheritance Law
Real estate, just like other Italian assets, is included in the inheritance process. Italy does not discriminate between its citizens and UK nationals, so if you are named in a deceased person’s will and they have left Italian property to you, it will be honoured. However, any debts associated with the property will need to be settled before it is distributed to the heirs.
Italy adopts the concept of “forced heirs,” meaning that there is an automatic entitlement to the deceased’s estate by the immediate family. Therefore, close family members, whether they are named in the will or not, have a right to the estate. Forced heirs include immediate family, ascendants, and other relatives, in a strict line of succession. You can sell the property you have inherited, provided you have consent from the co-heirs, and you will be subjected to taxes.
Italian Property Tax
When buying property in Italy, you should be aware of the various property taxes. The taxes you will need to the real estate tax (Imposta Municipale Unica), transfer tax (Imposta di Registro) and VAT.
The amount of tax you pay on a property depends on various factors, such as the property's value and your residency status. You will also have to pay capital gains tax if you sell a property in Italy. There are also some hidden fees to consider, such as notary fees, legal fees, the estate agent’s commission, and a property survey, although this is not mandatory.
The Benefits of Working with Italian Real Estate Lawyers
It is advised that you seek help from an Italian lawyer when buying property in Italy to avoid any potential pitfalls. One of the most common issues people experience is the language barrier, whether that is during conversations with estate agents and notaries, or in documents. Multilingual Italian real estate avvocatos based in the UK can help you translate documents and communicate with relevant parties on your behalf.
To find out more about working with Italian real estate lawyers, please read our full guide here. To book a consultation with our experienced team at Giambrone and Partners today, get in contact here.