A comprehensive guide to buying Italian properties
A purchase of property in Italy will proceed through 3 key stages:
- Proposta irrevocabile d’acquisto (Reservation offer)
- Contratto preliminare di vendita (Preliminary contract)
- Atto di vendita (Deed of sale)
Once you have chosen your property you should engage the services of a solicitor, whether you buy through a real estate agent or directly from the vendor. The knowledge of an Italian solicitor on Italian real estate law is invaluable – plus he is there exclusively to look after your interests.
When buying a property in Italythe first document you will be called upon to sign is the so called “proposta irrevocabile d’acquisto” (reservation offer), which is normal practice when purchasing through an estate agent. In contrast, when purchasing directly from the seller (private sale) this document is not normally used. The implications of there either being a reservation offer, or dispensing with it, is one of the many reasons why a solicitor should always be engaged.
By signing the proposta irrevocabile d’acquisto you will be securing the removal of the property from the market for a limited period of time, normally 15 days. During this interval your solicitor, where necessary assisted by a surveyor, will make all the necessary searches to ascertain that the property is without any debts, mortgages, claims etc., thereby assuring that there will be no unpleasant and possibly costly surprises during the final phase of the purchase. At this stage you will be required to pay a small deposit , which is normally held by the estate agent or solicitor until the offer is formally accepted (signed) by the seller. Should you finalize the purchase, this deposit will be considered as partial payment of the purchase price. If the seller does not formally accept the offer your deposit will be returned to you. It is important to highlight the fact that the reservation offer is only binding upon the buyer until formal written acceptance by the vendor, at which point, (being signed by both parties), it becomes a legally binding contract.
Normally at this stage, buyer and seller having agreed to go ahead with the conveyance, they will formalize their agreement with the “contratto preliminare di vendita” (preliminary contract). Some estate agents (and especially in private sales) choose or recommend leaving out this particular essential part of the purchase process. However, this legal document really is essential because it sets detailed terms and conditions for the sale. This is why it is highly advisable to engage the services of a solicitor, as one of their functions is to draft this contract where possible and, when not, at least to examine it and advise very carefully and in detail on its implications before you are either cajoled or pressured into signing it.
One of the essential legal elements of the preliminary contract is the payment of a deposit (caparra confirmatoria), normally equivalent to a minimum of 10% of the purchase price. This deposit will not be returned if you back out of the contract without a valid legal reason. On the other hand, if the seller changes their mind about the sale he/she will have to refund your deposit in full. You also have the right, if you wish, to claim an amount equal to the deposit through the Italian courts.
In the preliminary contract the parties also set the date to finalize the conveyance in front of the Public Notary.
The Notary is a public official who has the authority according to Italian law to validate contracts transferring the ownership of a property. He is also charged with paying all registry fees and cadastral taxes and carrying out the relevant searches on the property. Only by having engaged a solicitor beforehand can you be confident that no unpleasant surprises will be revealed at this late stage of the purchase process.
The notary is supposed to be an absolutely neutral and impartial party in the transaction. This is why he cannot be a substitute for a solicitor in terms of representing the interests of the buyer and the only way to be assured of proper legal safeguards is to engage the services of an independent solicitor.
The final step of the conveyance is the so called “atto di vendita” (deed of sale). The deed is drafted by the Notary in his office, and has to be fully compliant with the preliminary contract. It is the preliminary contract which accordingly dictates all the essential elements of the transaction. Once the Deed has been signed by all those present at the signing, the balance of the purchase price is paid to the Seller and the keys are handed over to the new owners.
A copy of the Deeds will then be given to the new owners approximately one month after the signing. This is because it takes approximately one month for the new deeds to be registered at the relevant Registry Office. Italian law requires that the deed of sale must be drafted in both Italian and English should one of the parties not understand the Italian language.
If the buyer cannot be present in front of the Notary the buyer can give power of attorney to his solicitor who will sign on his behalf. The Notary will read and explain the contract in the presence of the parties, and if present in person the buyer will be able to read and check over the English version, and of course if our recommendations are followed, then with the buyer’s own bilingual solicitor being in attendance, questions and queries can be raised by or on behalf of the buyer with the support of his/her own solicitor.
Giandomenico De Tullio
Proposta irrevocabile di vendita: This is where an initial formal offer is made and a small deposit is left. The price you are willing to offer has been determined and also any conditions you may wish to make.
Contratto preliminare di vendita: This is the contract that sets out in detail the terms and conditions of the sale and also all the relevant cadastral and registry information. It is also known as a Compromesso.
Atto di Vendita: The moment when, in front of a Public Notary, the exchange of contracts is made, the outstanding amount of the purchase price will be paid and the keys to the property will be handed over to the new owners.
Caparra confirmatoria: This is a deposit that is regulated under art.1385 of the Italian Civil Code. If a deposit is defined as a “caparra confirmatoria” its payment gives rise to legal rights and obligations for both parties.
Please note, any statement made in this article is intended to be a general practical introductory explanation only and not formal legal advice. This firm accepts no liability or any responsibility for any statement made.