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You are ready to buy a property in Italy? Here is a step by step overview of what’s ahead as you make your purchase.

As recently outlined in Helpful tips on buying a property in Italy, buyers are currently spoilt for choice and prices are also relatively stable. In this favourable climate, be sure not to get too carried away and allow for adequate time to analyse and source the best investment opportunity available. Once found, prepare for the fact that some time may pass before the purchase process is completed.

Average timescales are around four to five months with more difficult cases lasting up to a year or more. Properties on the market usually come with building or planning irregularities that need resolving before the sale can go ahead. Some will be minor and easily fixed; others may even render a property unsaleable. Be prepared for some red tape!

However, with the proper assistance and safeguards in place, timing to complete can be reduced to a minimum and the purchase process can be organized in accordance with the buyer’s needs. Note that both the purchase offer and preliminary contract (if required) are binding, so they must allow for the possibility to withdraw from the purchase without any penalty or obligation to proceed.

Any contracts signed should be subject to the successful outcome of due-diligence investigations, needed to ascertain many factors including the legal status of the property, the absence of any encumbrances and the conformity of the property with building permits and regulations.

If the property is purchased with the aim of carrying out renovations works, check these will indeed be possible and whether any permission has been given for developments in the surrounding area that may block any views or decrease the value of the property. Check that the area is not at particular risk of earthquakes, landslides or other environmental hazards.

Financing

Italian banks are still fairly cautious and it is generally possible to borrow around 60% of the purchase price. The mortgage contract must be signed in front of a Notary Public, generally at the same time as the purchase deed is signed. When the buyer does not understand Italian, it is much easier for the mortgage agreement (and purchase deed) to be signed by means of powers of attorney, generally given to the buying party’s lawyer.

An Italian tax number (codice fiscale) will be necessary and an Italian bank account is advisable, both of which are easily attainable.

Purchase offer

This is a written agreement under which the buyer unilaterally commits to buy. As mentioned, the offer needs to contain the necessary conditions or contingencies (e.g. conformity of the property).

Once the seller accepts the offer, both parties are committed in the same way as a preliminary contract.

Deposit

Together with the purchase offer, the buyer is normally required to leave an initial deposit (normally between 0.5-3% of the final price). These offers can often be written in ambiguous terms and if handled incorrectly can lead to the loss of the amount.

Preliminary contract

In Italy, it is very common to sign a “preliminary contract”, particularly when the property is not ready for immediate delivery to the buyer. This may occur when the selling party is a developer or is carrying out renovation work, when some important details are yet to be resolved (e.g. checking building permits) or when a buyer does not have the full funds available and a mortgage is required. The rights on the property do not pass on signing the preliminary contract, but from that point onward, the seller is obligated to sell and the buyer is obligated to buy. If the buyer defaults, the seller may withdraw from the contract, keeping the confirmatory deposit. If instead the seller defaults, the buyer may demand double the down payment. Alternatively, a court order may be requested to ensure the defaulting party fulfils its obligation.

The confirmatory deposit (caparra confirmatoria) is an amount of money, normally 20-30% of the total price, paid to the seller by the buyer at the signing of the preliminary contract.

The purchase deed, completion and payment

The purchase deed must be in written form and must be signed before an Italian Notary, who is an officer of the State. The Notary verifies that the rights can indeed be transferred and checks whether the property is subject to any encumbrances. Each Notary has their own standard contract they prefer to use but this can be negotiated together with the buying party’s lawyer.

The full rights on the property pass when the Notary completes the procedure and registers the contract at the local land registry. If the buying party does not understand Italian, the entire contract must be translated and an interpreter nominated. Alternatively, as for the mortgage contract, a power of attorney can be given to a lawyer or Italian speaker. The power of attorney must be signed in front of a Notary in Italy or in the country of the buyer. In this case, the procedure is simplified as only the power of attorney needs to be translated and, if overseas, the buyer does not need to travel to Italy to be present at the signing.

The most common method of payment is the delivery of a cashier’s cheque at the time the final deed is signed.

If there are no complications, the meeting in front of the notary generally takes one to two hours.

When the purchase involves a listed building, the Italian Ministry of Cultural Heritage can exercise its right of pre-emption so a further duration of 60 days is needed before the sale is finalized. Likewise, in the case of agricultural land, neighbouring farmers are duly informed and they also have the right of first refusal, which must again be exercised within 60 days of signing the purchase deed.

Article by Kate Taylor
Additaly – Real Estate & Consulting
Via Bonifacio Lupi, 29 – 50129 Firenze (IT)
7-10 Chandos Street, Cavendish Square, London, W1G 9DQ (UK)

In allegato l’articolo del Sole 24 ore del 21 Aprile 2016.

Il Chianti resta terra inglese

Buying a property in Italy can unfortunately be a nerve-wracking process and there are plenty of potential pitfalls. What starts out as an exciting adventure can quite easily turn into an unpleasant and costly experience. This is however no reason to be put off. Just be sure to do your research and to seek the right advice from the right people.

Why Italy? Why not. Prospective buyers are indeed spoilt for choice. Seaside villas, mountain chalets, Tuscan farmhouses, country vineyards and many interesting investment opportunities in Italy’s commercial hotspot, Milan. Combine this selection with a country renowned for its history, art, cuisine and fashion, such that it ranks one of the most visited countries in the world, and it is hard to deny the attraction.

So, am I eligible as a foreigner to buy a property in Italy? This is the first point to check. Generally speaking, yes. The Italian property market is open to all types of buyers who come from countries where Italian citizens can enjoy the same purchase rights.

Italy has always been a popular destination for overseas buyers, those looking for a holiday home and those choosing to retire or live in Italy all year round. There is an ever-increasing demand for holiday rental property so the buy-to-let strategy is very popular. Low-cost airlines have also helped to make many lesser-known parts of the country more accessible and despite Italy’s immense popularity, there are still many undiscovered areas with very reasonable prices. The remote Sicilian town of Gangi even launched a campaign a couple of years ago offering homes for a mere €1, with obligatory renovation works being the only catch.

Property prices are generally given per square metre and of course vary greatly depending on location, condition and property type. To give a few examples, a two-bedroom apartment in the centre of Milan can be found for €350,000, while a beautiful loft 600 meters from the Duomo will cost €1.9 million. Six kilometres from the city centre, a two-bedroom apartment can be found for as little as €60,000.

A three-room apartment in good condition in Venice’s San Polo neighbourhood will cost €355,000, but a well-maintained apartment in the San Marco area will set you back at least 7,500 €/sq.m.

A two-bedroom apartment in the centre of Florence can be found for €250,000 but for around €360,000 you can find a completely renovated three-room apartment in a prime location between the Duomo and the central station.

Still in Tuscany, a 320 sq.m farmhouse in good condition in the hills of Greve in Chianti, complete with swimming pool and private land, is for sale at €770,000.

In Umbria, where the countryside and way of life is entirely comparable to that of Tuscany, you can find a four-room apartment for €120,000. Instead, with €3 million, you can purchase a 1,000 sq.m renovated boutique hotel complete with private park and swimming pool.

For an apartment in the centre of Rome, prices instead fluctuate from 5,000-8,000 €/sq.m., depending on the surface area and state of maintenance.

In Puglia, you could purchase five trulli, typical local buildings in the Alberobello area, completely renovated with land and swimming pool for little more than €250,000. A typical and completely restored house in Monopoli, measuring around 650 sq.m., will instead cost €600,000.

In the main islands of Sicily and Sardinia, there are many interesting areas where you can buy a three-room apartment for less than 80,000. A 310 sq.m villa with swimming pool in Porto Cervo on Sardinia’s “Emerald Coast”, will instead cost €2.9 million.

There are even places in central and southern Italy where you can purchase a property for less than €1,000/sq.m.

According to economic research company Nomisma, prices are expected to remain relatively stable during 2016 and a more significant upturn is predicted for 2017.

Professionals involved in a property purchase. Who does what?

The buyer has the right to choose the Notary (notaio), who will certify, at the time of signing the final purchase deed, that the seller is in fact the legal owner and that the property is unaffected by any mortgages, burdens or restrictions. The Notary will register the deed at the local land registry and will pay the transfer taxes on behalf of the buyers.

An independent lawyer (avvocato) acting on behalf of the buyer may draft/check and negotiate all the contracts involved in a property purchase: from the instructions to the estate agent to the final purchase deed, going through the purchase offer and preliminary contract, if necessary. The purchase process should be organized in accordance with the needs of the client and the outcome of technical/legal due-diligence investigations.

A surveyor (geometra) can verify the market value of the property, check the technical specifications and whether the factual state of the property conforms with the local planning records, regulations and restrictions. The surveyor is also in a position to check the feasibility of and direct any renovation works performed on a property.

Both buyer and seller, if used, normally pay the fees of the estate agent. Italian law states that the broker’s commission is due if the deal is concluded as a result of the estate agent’s intervention. In absence of an agreement between the parties and the estate agent, the amount of the commission is determined by professional rates or local practice. To avoid unpleasant surprises, it is advisable to sign a written agreement with the estate agent, specifying the agreed fees, any expenses due, and relevant terms and conditions of payment, etc.

Commencing your search. So where do I start?

This depends on the time you have available and the type of property you are looking for. There are many websites advertising properties from all over Italy and these can help prospective buyers get a better feel for the local market and properties on offer and to organize inspections. Another option could be to seek the advice of experts who can provide you with a selection of properties that meet your specific requirements.

Article by Kate Taylor
Additaly – Real Estate & Consulting
Via Bonifacio Lupi, 29 – 50129 Firenze (IT)
7-10 Chandos Street, Cavendish Square, London, W1G 9DQ (UK)

A high-level delegation of Italian government ministers, real estate and trade officials is flying the “Invest in Italy” banner at the annual MIPIM world real estate fair, which got underway Wednesday in Cannes.

This year, Italy is showcasing more than a thousand state-owned properties, including historic villas and palaces and a range of development opportunities in both the residential and commercial real estate sectors.

Over the past 24 months, Prime Minister Matteo Renzi has pushed through a raft of economic reforms designed to cut red tape, create a more flexible labour market and lower a variety of taxes. The aim, as the Prime Minister said recently, is to show that “Italy is back” as an investor-friendly country with an economy that is growing again after years of recession.

In 2015 Italy’s privatization efforts saw the sale of €752m worth of state-owned properties, ranking Italy’s real estate disposals just behind the UK (€842m) and ahead of Germany (€699m) and France (€572m).

The Rome-based Invest in Italy office of the Ministry of Economic Development, in cooperation with the Italian Trade Agency (ITA), has also been re-energized by the prime minister’s efforts and is now offering one-stop shopping for foreign investors.

Among its recent achievements, the newly streamlined FDI office managed to clear the way for a €1.4bn investment by Australia’s Westfield group that will lead to the construction near Milan’s Linate airport of what will become in 2020 the largest shopping complex in Europe, a sprawling 235,000 square-meter development that will feature 300 shops and 50 restaurants. The project will create 27,000 new jobs. The same team is now clearing away obstacles that could see more than €6bn of new investments in 20 other major Italian real estate projects.

Among those attending MIPIM are Italy’s Defence Minister Roberta Pinotti and Ivan Scalfarotto, the newly named Vice Minister at the Ministry of Economic Development. At a special “Italy Day” conference held Wednesday and chaired by Riccardo Monti, President of ITA, the first 200 property assets went online on the new portal: http://www.investinitaly.com.

“Our presence here today,” said Scalfarotto, “is proof of our ability to bring together key players in the public and private sectors.” The Vice Minister said that total real estate transactions in Italy increased by 52.8% in 2015, to more than €8bn, of which three quarters came from foreign investment.

“The Government intends to build on this positive trend by accelerating its reforms and its policies aimed at making foreign direct investment in real estate simpler, more transparent and more secure,” Scalfarotto added. The new web platform, he said, would contribute to making state-owned properties available to investors.

SOURCE Italian Trade Agency

For more information visit:

http://www.prnewswire.com/news-releases/italy-to-showcase-more-than-1000-state-owned-properties-at-mipim-572221991.html

The three top regions for British second home buyers are Tuscany, Puglia and Abruzzo – and their demand for Italian property has grown by a third in the last year, says a top website.

Britons are the leading buyers of Italian property through online provider, Gate-Away.com, followed by the Americans, Germans, French and Belgians.

In fact, demand from UK property seekers rose by almost one-third (32%), according to the Gate-Away 2015 Annual Report.

The average value of property sought is around €300,000, with buyers favouring detached houses over apartments.

Most buyers (70%) are looking for Italian properties worth up to €250,000, with 39% wanting homes up to €100,000. Around one in 10 (11%) of buyers want luxury homes.

Gate-Away.com General manager, Simone Rossi, says, “The preference for properties in the medium to low bracket reveals a characteristic tendency of the English not to consider renovation as an obstacle, but to view it as an opportunity to give a personal touch to the property.

“Requests received through our portal for properties partially renovated or to be restructured come to more than 30% in total. Another aspect that characterises the British buyers, says Simone Rossi, is dealing with modernisation and restoration projects, relying on local craftsmen and using materials appropriate to the original style of the chosen property.”

Use of restoration materials, attention paid to practitioners of local building traditions and the choice of furnishings in line with local traditions are often found in English potential buyers corresponding with a typical outline: these are often people with moderate to high cultural knowledge, almost always frequent travellers, demonstrating a love of the Italian lifestyle, not only the fashion, luxury or food – the more obvious things – but also the nature of the country, with its history, roots and traditions.

“A customer’s age, education and tendency to travel – added the general manager of Gate-Away.com – ensure that, when searching for a property, there is a willingness to, as much as possible, respect the characteristics, at times giving new life to the structure in an excellent way, then adding the personal touch common to foreign buyers, especially the British.”

Tuscany remains in first place in the rankings, while the increase in interest for Puglia brings it to second place, even though up until a few years ago it was unheard of and it’s a similar case for Abruzzo, which is a close third. Liguria is fourth and Piedmont fifth place.

Looking at the favourite cities targeted by British buyers, Ostuni, Carovigno and San Vito dei Normanni in the province of Brindisi, are in demand. In addition, the Tuscan town of Fivizzano in Lunigiana and Syracuse in Sicily.

Gate-Away.com has more than 18,000 properties currently for sale by more than 360 Italian real estate agencies and more than 1,700 private owners.

For more information visit:

http://www.opp.today/british-demand-for-italian-second-homes-rises-by-a-third/#5BECJiHK2rKuBbVa.97

Tuscany has been ranked second among Mid-sized European Regions of the future 2016/17 – FDI Strategy” according to ‘European Cities and Regions of the Future Rankings’ prepared independently every two years by ‘FDI Magazine – Financial Times,’ which compares data and information on 481 locations for European cities and regions.

Second, after Greater Copenhagen, between regions with 1.5 and 4 million inhabitants where also Greater Stockholm Region, Northern Ireland, Wallonia, Basque County and the Brabant were on the Top 10 list.

Parameters used in the evaluations include: economic potential; labour environment, cost-benefit ratio (cost effectiveness), infrastructure, favourable business environment (business-friendliness) and FDI promotion strategies. The evaluations were performed by an independent panel of leading industry experts.

The judges were particularly impressed by the region’s digital offering, which includes a new website, and updated Guides on Doing Business in Tuscany and costs of setting up in our region.

The awards ceremony will be held on March 15 in Cannes, France, during the exhibition ‘MIPIM’ dedicated to real estate investments, where ‘Invest in Tuscany’ will be present.

‘Invest in Tuscany’ who is behind the development of FDI strategy, is a network coordinated by the Tuscan Region whose objective is to encourage, support and develop the entry of foreign capital into the Region. Working in partnership with Municipalities, Provinces, Chambers of Commerce, universities, research centres and national institutions such as Invitalia and ICE, ‘Invest in Tuscany’ is a point of contact for companies and corporations interested in investing in Tuscany.

For more information visit:

http://www.investintuscany.com/invest_in_tuscany_view_news/260/tuscany-rated-second-among-mid-sized-european-region-for-investment-attraction-strategies

Government investment funds in Abu Dhabi and Qatar, as well as in Azerbaijan, have invested a combined $380 million in three different properties in Milan.
Wall Street Journal reported that Abu Dhabi Investment Authority has agreed to buy a 1960s building in the north Italian city, which the newspaper said will be demolished and replaced by a new tower.
Late last month, Qatar Investment Authority completed a deal to acquire the historical building that housed BNL’s (a subsidiary of BNP Paribas) headquarters in Piazza San Fedele in Milan.
The State Oil Fund of the Republic of Azerbaijan is buying a building from the Italian chamber of commerce, bring the total investment – including costs of redeveloping the sites – to $380 million (€350 million).
The investment comes at a time when sovereign wealth funds are investing heavily in Italian property, as its economy emerges from a three-year recession. Data-firm Real Capital Analytics said investment in Italian real estate last year was around $9.7 billion, up from $7.2 billion in 2014. In Milan, 90 percent of investment into city came from foreign investors, according to Knight Frank.

For more information visit:

http://www.arabianbusiness.com/abu-dhabi-qatar-funds-invest-in-milan-properties-617374.html

Baku, Azerbaijan, Jan. 6

By Aygun Badalova – Trend:

Government investment funds in Azerbaijan, Abu Dhabi and Qatar in the past two weeks have agreed to invest a combined 350 million euros ($380 million) to buy and develop three separate properties in Milan, the Wall Street Journal reported citing a person familiar with the transactions.

The State Oil Fund of Azerbaijan (SOFAZ) is buying a building from the Italian chamber of commerce, while the Abu Dhabi Investment Authority is buying a 1960s building that will be demolished to make way for a new tower, according to the person.

On Dec. 22, the Qatar Investment Authority agreed to buy a property from BNP Paribas SA. The purchase prices weren’t disclosed.

The 350 million euros includes the cost of redeveloping the three sites. All three will be managed by Italian property company Coima SGR, the person said.

SOFAZ was established in 1999 with assets of $271 million.

Based on SOFAZ’s regulations, its funds may be used for the construction and reconstruction of strategically important infrastructure facilities, as well as solving important national problems.

The main goals of the State Oil Fund include: accumulation of resources and the placement of the fund’s assets abroad in order to minimize the negative affect on the economy, the prevention of “Dutch disease” to some extent, promotion of resource accumulation for future generations and support of current social and economic processes in Azerbaijan.

For more information visit:

http://en.trend.az/business/economy/2477115.html

According to Knight Frank, Milan’s office investment volumes have surged during 2015, as improvements in the Italian economy have helped to attract a wave of cross-border activity.

After being one of a handful of European countries to be in recession in 2014, Italy has returned to positive economic growth in 2015 and its GDP is forecast to increase by c. 0.9% annually. The strengthening of the economy has encouraged a revival in investment market activity, and Milan office investment reached €1.4 billion in the first three quarters of 2015, comfortably exceeding the full-year total for 2014. Cross-border investors led transaction activity, taking a 90% investment share during this period.

As a result, Milan office investment is on course to reach approximately €2 billion by the year-end – a post-crisis record. International investors are expected to remain active in the coming months, but volumes are also likely to be boosted by increased domestic demand. The strength of demand has led to significant yield compression; prime office yields hardened to 4.5% in Q3 and could fall further over the coming quarters on the back of improved investor confidence.

The Milan occupier market has also shown positive trends, with office take-up during Q1-Q3 2015 totalling c. 190,000 sq m. Annual take-up for 2015 is expected to reach as high as 240,000 sq m, in line with the 10-year average.

Alessandro Riboni, Chief Executive, Knight Frank Milan, commented: “There is an ongoing interest of institutional foreign investors in the Italian market. We expect an increase in deals and in the values of the real estate market.”

Heena Kerai, International Research Analyst at Knight Frank, commented: “Cross-border demand for Milan offices was the major driver of investment activity in the first three quarters of 2015. US buyers took the largest share of activity, accounting for 46% of transaction volumes, followed by European investors. While Italian investors have largely focused their demand on office assets in other Italian cities, we could begin to see them moving back to Milan, as market sentiment continues to improve.”

For more information visit:

http://www.worldpropertyjournal.com/real-estate-news/italy/milan/milan-office-market-report-knight-frank-office-space-for-rent-in-milan-milan-office-buildings-for-sale-alessandro-riboni-heena-kerai-9559.php

Auctions are a superb opportunity to buy property in Italy at knockdown prices – especially with an estimated 80,000 available on the market at any one time.

However, they are an option that remains very much ignored, especially by Brits and other foreign investors.

Yet the advantages of purchasing a home in Italy via auction are considerable.

Apart from the fact that you’re buying a home at a fraction of its true market value, you also avoid paying geometra (surveyor) and notary fees, which between them can cost around £4,000-£5,000.

In addition, in some auctions overseen by a court, an amnesty may be granted if you purchase a property that has partly or entirely been built without the appropriate planning permission – normally a serious breach that can prevent a property being sold.

Below is a broad outline of how the process works.

However, as with all overseas property purchases, and particularly in Italy, it is advisable to use the services of a reputable estate agent or company specialising in auction sales.

Properties in Italy come up for auction for three main reasons:

When the owner has defaulted on mortgage repayments meaning the property has been or is about to be repossessed;
When a governmental or a public body owns them and wishes to dispose of them;
When they have been confiscated in criminal proceedings.
The process of purchasing at auction in Italy has been made much easier since a change in the law a decade ago.

It made a previously arcane arm of the real estate industry suddenly more transparent – principally allowing for auction notices to be made publicly available, along with details of the properties due to go under the hammer.

That, and the global economic crash in 2007-08, has seen a surge in the number of available foreclosure and other auction properties.

Auctions are typically held in the offices of a lawyer/accountant etc, if they are bankruptcy/foreclosure sell-offs. Judicial auctions, on the other hand, usually take place in court.

Ahead of an auction, a surveyor will provide inspection report on the asset for sale, outlining any issues such as subsidence. In addition, prospective investors can examine the property in person for themselves.

Auctions are open to anyone except the existing owner, as long as they register in advance. This sometimes has to be done as early as 60 days before the sale.

A deposit must also be paid, equal to ten per cent of the auction starting price, plus the costs of registering the property under your name should your bid eventually be successful.

Most Italian financial institutions offer mortgages to cover properties bought at auction. However, if you intend to buy using a mortgage, you must provide a promise letter from the lending bank.

Auctions are conducted either “with reserve” or “without reserve”.

If they are “with reserve”, prospective buyers hand in offers in sealed envelopes, which are opened just before the sale gets under way.

The highest offer is used as the starting point for all bids. The winning bid must be at least 20 per cent of the reserve price for it to be accepted. In any case, the seller has the right to refuse any winning bid.

Where sales are staged “without reserve”, the highest bid wins out, irrespective of price.

In both types of sale, the winning bidder has up to 60 days to pay in full for the property. There is no cooling-off period and if for whatever reason they change their minds afterwards, they lose whatever deposit they have already paid.

Other prospective buyers whose bids were unsuccessful simply have their deposits returned to them once the auction closes.

For more information visit:

http://www.homesgofast.com/blog/3321-buying-homes-under-the-hammer-in-italy/