Thanks to its rich history, amazing landscapes, and unique culture, Italy has long been a top destination for expats and foreign investors who buy property abroad.
When buying property in Italy, prospective buyers have a wide variety of homes to choose from, including vacation homes in the countryside, apartments in the historic part of town, and lovely seaside homes that help you escape the noise of city life.
This guide will help you navigate the process of buying a property in Italy. It will explain in detail the current state of the Italian real estate market, the types of homes available, the costs of property purchase, and finally, the most common pitfalls.
Why Consider Buying Property in Italy?
One of the most common reasons why North Americans, UK citizens, and any other foreign nationals start considering purchasing property in Italy and moving there is due to the country’s scenic landscapes and outstanding balance between laid-back and hard-working life lifestyle.
Here are the main reasons why consider property purchase in Italy:
- Diverse lifestyles: Prospective Italian property owners can choose the lifestyle that is suited for them. They can choose from luxurious villas in calm areas like Tuscany and vibrant city life in places like Rome and Milano.
- Property price: Compared to other popular European countries like France and Spain, it might be more beneficial to purchase property in Italy given that the prices are lower outside tourist areas.
- Rich culture and history: While living in Italy, you get to discover centuries of history, world-class art, and a culinary tradition.
- Warm climate: Italy is best known for its warm climate, but there are other areas that will make buying property in Italy a worthwhile investment, like the cool alpine area in the north.
- Income potential: Italian property owners can also choose to rent out their property. This can be quite lucrative if you own a vacation home at the seaside or in any other tourist destination.
What’s the Real Estate Market Like in Italy?
The Italian real estate market varies from region to region. That means that the property sale and price change depending on the area where you are buying your real estate in Italy.
Even though the Italian real estate market has seen some fluctuations in the past, it’s fairly stable and it remains a solid option for investment. Essentially, it boils down to finding the right property for you.
Here’s the breakdown of the real estate market according to regions:
- Northern regions: Northern Italy, especially regions like Tuscany, Lombardy, and Veneto, typically have higher house prices, particularly in major cities. The most common type of buyers in this region are those who want luxury homes, vineyards, or properties in urban centers.
- Southern Italy: In contrast, southern regions like Calabria, Puglia, and Sicily have more affordable property options. Precisely because of that, Southern Italy is popular for those looking for budget-friendly purchases or investment opportunities.
It’s also worth noting that the property prices, as well as agent fees, are more expensive in large cities like Rome, Milan, and Naples. This is largely due to high demand.
Rural areas, on the other hand, have more budget-friendly prices, but you should speak Italian since most locals don’t speak English.
On top of that, the Italian government is incentivizing both local and foreign buyers to invest in rural areas by offering properties for as little as €1.
All Types of Property in Italy
Italian citizens and foreign investors looking to buy property in Italy have access to different property types. The most common types of homes house hunters will encounter include the following:
1. Countryside villas:
These are among the most sought-after properties in Italy, especially in regions like Tuscany and Umbria.
These homes are often stretching on large plots of land and usually have olive groves or huge vineyards.
2. City apartments:
For all those who prefer the hustle and bustle of urban life over tranquil villas, the best deal for you would be buying a city apartment.
The most common locations include cities like Rome, Florence, Venice, and Milan. Naturally, you can find both modern apartments and historic homes in the city center.
3. Coastal properties:
The property market in Italy also includes a variety of coastal properties. Real estate agents typically offer homes on the Amalfi coast, which offer stunning sea views and are great for short-term rentals.
Another factor that might be included in the price of the property is it being within walking distance of a beach.
4. Historic homes:
Given that Italy is known for its rich culture and history, many foreign investors are looking to buy property in Italy that holds cultural significance.
Buying this type of real estate in Italy means you’ll probably have to invest more money in renovation and restoration, and it would be good to coordinate this with Italian banks in advance.
Step-by-Step Guide on Purchasing Property in Italy
Buying property in Italy can be a bit more complex than in other countries, but if you get agents and a mortgage broker, you should have your Italian home in no time.
Here’s a breakdown of the key steps of property purchase in Italy:
1. Research the market:
First of all, it’s highly recommended you start your Italy search for a home by thoroughly researching the region you’re interested in and the types of Italian properties available.
Also, consider which type of home will suit you and your family members.
2. Hire a real estate agent:
A reputable real estate agent can help you navigate the Italian property market, find the best property for you, and make the purchase process simple.
If you’re a non-resident, you should look for an agent who specializes in international purchases and can help you meet all legal requirements.
3. View properties:
When you find a home that fits you and your family, the next step in the buying process is to visit the property and take a look at all the features this home comes with.
4. Make a formal written offer:
If find a good investment, draft a formal written offer with your agent and submit it to the seller, outlining your purchase price and any conditions.
5. Sign a preliminary contract (Compromesso):
After your offer is accepted, you’ll sign a preliminary contract (also known as the “compromesso”). This is a legally binding contract that outlines the terms of the sale.
At this stage, you’ll also pay a deposit, which is usually around 10% of the purchase price.
6. Sign the final contract (Rogito):
After signing the preliminary contract and it’s been approved, you should draft the final contract (the “rogito”) in the presence of an Italian notary. Once this contract is signed, you’ll officially own the property in Italy.
7. Pay closing costs:
After you sign all contracts, make sure to pay all closing costs, including notary fees, stamp duty, and other taxes.
Can Foreigners Buy Property in Italy?
Yes, foreigners can buy property in Italy. There are no legal restrictions on non-residents buying real estate, regardless of whether you come from a European Union or non-EU home country. Besides that, foreigners can get an Italian mortgage too.
Non-EU buyers may need to consider visa requirements, especially if they plan to live in Italy or spend long periods in the country.
However, if you have plans to rent out your property or live in Italy full-time, you may need to apply for a residency permit. It’s also recommended to seek local advice from lawyers to help you with tax obligations.
Take a look at our guide on how to get Italy Golden Visa.
The Cost of Property Purchase in Italy
While buying property in Italy, it’s important to take into account the price of the property, and various additional costs involved in the purchase process such as taxes and fees.
Here’s the breakdown of the most important costs of property purchase in Italy:
- Purchase price: This is the first and the most important cost you should take into account. The prices vary by location.
- Estate agent fees: Estate agent fees are usually split between the buyer and the seller. Expect to pay between 3%–7% of the property’s purchase price.
- Notary fees: In Italy, you need to find a notary to oversee the legal aspects of the property purchase. Notary fees can vary, but they should be around 1%–2% of the purchase price.
- Stamp duty and registration tax: Stamp duty is calculated based on whether the property will be your primary residence or a second home. For a primary residence, the registration tax is 2%, but it rises to 9% for a second home.
- Land registry tax: This is another cost to be mindful of, especially when registering your property with local authorities.
- Final costs: Costs such as legal fees, surveys, and inspections typically add around 10%–15% to the total purchase price, and they are typically the final expenses you need to pay.
- Additional Costs: If you’re buying an older or historic property, make sure to budget for potential renovations, reconstructions, and any additional fees that might come with that.
4 Most Common Pitfalls When Buying Italian Real Estate
While buying property in Italy, make sure not to fall for the most common pitfalls, such as:
- Overlooking additional costs: Many buyers focus solely on the purchase price and they forget other costs of taxes, fees, and renovations.
- Legal complexities: Italian property laws are quite complex, especially if you’re not familiar with them. So, it’s highly recommended to work with a qualified lawyer and notary to ensure all documents are in order.
- Unclear ownership titles: Make sure that the property has a clear title and it’s free from any disputes or debts.
- Ignoring local regulations: Each region has its own building regulations and laws. Make sure to check these before buying property in Italy.
5 Best Places in Italy to Buy Property
Even though you should always look to buy a property that suits you the best, there are locations in Italy that attract the most property buyers.
It’s worth noting that some may be hit by natural disasters, and you should consider that too, when buying a property in Italy.
Here are the best locations in Italy to purchase a property:
1. Tuscany
Tuscany is one of the most iconic locations in Italy due to its stunning landscapes and charming villages. So, for those seeking luxury countryside villas or vineyard properties, Tuscany would be a perfect home location.
2. Rome
If you buy a home in Rome, you can’t really go wrong. Not only will you have plenty of historical sights to explore, but you can also discover Italian cuisine and all the other aspects that make Italy worth moving to.
3. Lake Como
Lake Como is a popular choice for international buyers seeking a glamorous lifestyle since it’s brimming with luxury homes with breathtaking lake views and it’s known for its laid-back lifestyle.
4. Puglia
This southern region is known for its affordable property prices and stunning coastline, making it an excellent choice for budget-conscious buyers.
5. Sicily
Sicily offers some of the most affordable real estate in Italy, with plenty of opportunities to purchase historic homes at great prices.
Taxes on Property in Italy
When you buy property in Italy, you will need to take care of a variety of property taxes, such as:
- Stamp duty (imposta di registro): This is 2% for Italian residents and 9% for non-residents buying a second home. It’s important to note that those who don’t plan on living in Italy will have to pay tax if their income exceeds a certain threshold.
- Capital gains tax: If you sell the property within five years of purchase, you may have to pay capital gains tax.
- Property Taxes (IMU and TASI): These are annual taxes based on the property’s value and its location.
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Frequently Asked Questions about Buying Property In Italy
Can a foreigner buy a house in Italy?
Yes, foreigners can buy a house in Italy without any restrictions. Italian law is different for EU nationals and non-EU citizens, and it’s worth consulting with a lawyer before making a purchase.
Is buying property in Italy a good idea?
Yes, buying property in Italy can be a great investment since it offers diverse real estate options, from villas to city apartments, with relatively affordable property prices.
The beautiful landscapes, rich culture, and favorable climate make it ideal for vacation homes, retirement, or long-term investments in the real estate market.
What is the process of purchasing property in Italy?
The process of purchasing property in Italy involves finding the right property, making a formal offer, signing a preliminary contract, and completing the purchase with a notary through a final contract.
Also, you should account for other costs like agent fees, notary fees, and property taxes.
