Estate agents are regulated under strict legislation and there are severe penalties for malpractice.

Whereas the Exchange (compromesso) is a private contract between the parties which does not necessarily requires the presence of a solicitor, the final completion deed takes place before a Public Notary (Notaio) who’s responsible for verifying the identity of the parties involved, checking the legal validity of the title deeds, witnessing the transfer of title from one party to the other and registering the title deed.

The whole process takes place in three basic steps.

1) Once you’ve identified a property you want to buy, you need to make a written offer called “Proposta irrevocabile di acquisto” (usually prepared by the estate agent) which is normally supported by the payment of a small deposit – anything from €1000 to 10% - just to show that you are serious about the purchase. In this letter you will mention the price you are willing to pay and any contractual clause or conditions you want to add, as well as the time limit by which the vendor must take his decision. If the vendor signs his acceptance, then both parties are bound to proceed.

2) If the offer is accepted by the vendor, a contract will be drawn up in the form of a private agreement, the Contratto Preliminare di Vendita or - as it is more commonly called - the Compromesso . This document will contain details of the property as they appear in the Land and Property Registry (known as the cadastral details), agreed purchase price, payment schedule, guarantee of ownership and all other relevant terms and conditions. This contract, once signed, is binding for both parties. The deposit which is paid at this stage – the so called Caparra Confirmatoria, usually amounting to 10%-30% of the final purchase price – will be lost by the buyer if they withdraw from the transaction for any reason other than stated within the Compromesso. On the other hand, if it is the vendor to withdraw, he will have to return the prospective buyer double the amount of the Caparra Confirmatoria.

3) The definitive act of transfer – usually taking place between 1 to 3 months after the compromesso - is called Rogito or Atto di Compravendita and is prepared by and signed before a notary, a “Notaio”. This is a public official who’s got the task of establishing the legality of the transaction, of checking that there are no outstanding debts on the property and of collecting the state taxes. At this time the balance of the purchase price is paid to the vendor. Once the transaction has been completed, the Notary will register the new title within twenty-one days at the Conservatoria dei Registri Immobiliari (the Land and Property Registry) and hold the deeds at his office. The purchaser can obtain a copy of the deeds once they have been registered, usually about 2 to 3 months after purchase.

Main purchase costs

The usual costs of a property purchase can be broken down as follows:

1) Structural survey, inspection of the property deeds, new fractioning of the land, carried out
by a “geometra” – if necessary - approximately € 500-1500 + 20% IVA (VAT)

2) Purchase price, as agreed.

3) Italian Estate Agent’s fees, normally 2% to 3% of the purchase price + 20% IVA (VAT)

4) Notary fees – usually 1% to 2% of declared price (the cadastral value of the property, rather than its commercial value) + 20% IVA (VAT)

5) Taxes and stamp duty based again on the cadastral value of the property (usually much less than the actual market value of it) - 10% for a secondary residence, 3% for a primary residence plus, if applicable, 18% on the value of the land.

For example, on a property of say € 100,000.00 this would mean:

Purchase price – € 100,000.00
Agency commission - € 3,600.00
Notary fee - €2,400.00
Taxes (as a second home) – about € 6,000.00 based on a registered value of € 60,000.00

Total € 112,000.00 inc. IVA (VAT) or approximately an extra 12% on top of the purchase price.

Further costs will be incurred if an Italian mortgage is required. In Italy a mortgage contract with a bank is signed before a notary and requires the payment of a second set of notary fees in addition to the bank charges.