How to Buy Real Estate in Italy

It is fortunate that there are no restrictions on foreign ownership of real estate in Italy but there are a few requirements in order to effectively  complete the transaction process.

A foreign citizen who wishes to purchase property in Italy must first obtain a tax identification number (codice fiscale). In addition, in order to simplify payments, it is recommended to open a bank account in Italy, then both  buyer and seller can delegate someone to act on their behalf. In this case, the assignment of a special proxy will need to be signed in the presence of a notary (in Italy) or at an Italian Consulate or Embassy. Even though it’s not mandatory to retain a translator, it is desirable to seek assistance if you aren’t fluent in Italian.

For most buyers, the Italian legal process will be completely unfamiliar, long (The entire process usually takes between six to eight weeks) and difficult to understand due to the complexities of Italian law and taxation. For all of the above-mentioned steps, it is suggested to request specialized legal assistance, in order to best to protect your interests, it would also be important to note that Italian law provides for pre-contractual liability. Furthermore, we suggest seeking qualified fiscal advice, however, we shall provide the following steps to follow to buy real estate in Italy for your reference:

Phase 1: Irrevocable offer (Proposta irrevocabile d’acquisto)

It is usual practice when purchasing through a real estate agent for the buyer to make an irrevocable offer to purchase and set a deadline for acceptance. The irrevocable offer binds the buyer to purchase the property for its period of validity, but it does not bind the seller until the moment the seller formally accepts it.

Phase 2: The preliminary contract (compromesso)

The preliminary contract is a private agreement between the buyer and seller. It is usually drawn up by the seller’s attorney and must contain the specific terms and conditions of the sale, including the sale price and is binding in a court of law. Once both parties have signed, they are both committed to the transfer of the property. Upon execution, the buyer usually pays the seller a down payment (caparra confirmatoria) for the amount between 10% and 30 % of the purchase price, at this point the buyer may still withdraw at the risk of losing the deposit. The seller may also withdraw but he will have to return double the amount of the deposit.

It is highly recommended to register the preliminary contract as a precautionary measure, the purpose of registration is to prevent third parties from charging any other interests against the property during the period between the date of the preliminary contract and the date of the deed of sale.

Under these terms, a preliminary agreement is very rarely broken and generally speaking leads to the signing of the final contract. 

Phase 3: Deed of sale (Rogito)

The Rogito is a public sales act drawn up by a notary (notaio). He/she oversees the signing of the deed, registers it at the Property Register and collects the tax on the property (hence the need for a Codice Fiscale). The necessary government duties must be paid for the sale to be officially registered. The notary also has the responsibility of performing due diligence as he acts for both parties.

The process described above also applies in cases where the buyer, or the seller is a company. In addition, in the case of a foreign company purchasing property in Italy, the notary may require copies of documents regarding the registration and incorporation of the company in its country of origin.