Buyer’s pocket guide

• After finding the dream home, an offer to purchase follows as a sign of your interest. The purchase process involves typically three steps: the irrevocable purchase proposal, the preliminary contract, and the notary deed. However, depending on the sale itself, sometimes the parties involved can skip the first or the second step. 

Read on the next question for the differences among these contracts.

• Our agency will draw up a pre-sale contract outlining the property’s details, the buyer’s and seller’s details, payments stages, and the closing date of purchase. In most cases, and to strengthen the commitment, a sum of money is attached to the proposal, often deposited as a confirmatory down-payment (pursuant to Article 1385 of the Italian Civil Code), payable to the agency at the moment of the signing. Should the offer be accepted, the vendor might cash that amount as part of the purchasing price, and the buying process moves forward to the signing of the preliminary contract. However, as an internal policy and to avoid future problems between the parties, we hold the security deposit until the final notary deed. Should the seller reject the offer, we will promptly return the security deposit. Unfortunately, the irrevocable purchase proposal is only binding on the buyer, leaving thus the seller free to consider other offers.

• The second step is the signing of the preliminary contract. This one can be drafted either by our agency or the notary and outlines and enhances the property’s details, including the agreed-upon price, the timings of the sale, payments’ stages, existing mortgages, what’s included (furnishings and fixtures), and the date of the final deed of sale. Unlike the irrevocable purchase proposal, the preliminary contract is binding on both parties and must be followed by a down payment* of usually 10% of the property’s total price. If the buyer backs out, he/she forfeits the security deposit; on the other hand, should the seller withdraw from the deal, he/she shall be obliged to pay double the amount received. *For extra reassurance, buyers can also transfer the down payment through a notary’s escrow account. The notary will release the funds only after the deed is registered.

• The third and last step is the notary deed (rogito notarile). The parties sign in front of the notary, a public figure in Italy who acts on the government’s behalf, the notary deed.
  The deed states the handover of the property by transcribing it in the real estate registers, which in Alto Adige is known as Giudice Tavolare. Together with the notary, we check on your behalf property compliance to make sure that the house will be completely free of any liens, encumbrances, easements and contracts of an obligatory nature at the signing of the notary deed. However, should one deem it necessary, he/she can appoint a lawyer at his/her expenses.

We are in contact with local banks and would be happy to put you in touch with an English-German-speaking mortgage advisor. As for many other countries across Europe, the procedure is always the same: the bank will thoroughly review your finances and ask for insights about the property you will buy. The bank will release the funds (generally the bank finances up to 50%) only after carrying out the relevant checks.

The taxes of buying a home in the Badia Valley and Italy vary depending on whether the seller is a private individual, a non-VAT registered entity or (construction company selling after five years from the building of the property) a VAT registered entity (construction company selling within five years from the construction) and whether tax breaks apply for the first house purchase.

• “First house” refers to the primary residence.

• The stamp duty is paid on the cadastral value (See the visura for the cadastral value of the house);

• The VAT is paid on the sale price. The VAT is 22% on luxury homes (cat. A/1, A/8, A/9). (See the visura for the details). 

The following table explains how much taxes differ.

Foreign buyers are also entitled to first home benefits, provided that the following requirements are met:

• The property should be used as the primary habitation;
• The property should not belong to A/1, A/8, A/9 categories (luxury homes);
• The property should be located in the same municipality where the property buyer has established or will establish the residence within 18 months;
• The property buyer should not have exclusive (either solely or jointly with the spouse) right of exclusive ownership, usufruct, use and occupancy, on another home located in the same municipality as the property to be bought, or bare ownership on another home bought by himself/herself or by the spouse. For further and always up-to-date information, head over to the Italian Agency of Revenue website. 

Alongside the taxes and the security deposit, consider the notary expenses and our commission (3% on the purchase price agreed). 

Our fee is 3% + VAT on the purchase price agreed.

With the handover of the property, the major ongoing costs for the new owner are:

•  Utility costs
•  Maintenance costs 
• Property tax, which in Alto Adige is known as IMI (Imposta Municipale Immobiliare), and the local tax (paid if buying as a second home).