As the third-largest economy in Europe, Italy holds an irresistible allure with its cultural richness, art, history, stunning landscapes, appealing climate, and delectable cuisine. It is a country that has numerous reasons to attract both tourists and overseas property investors alike.
The region of Liguria, situated on the Italian Riviera, boasts a mild climate, beautiful blue-flag beaches, and picturesque villages that are gaining recognition among tourists. The area is easily accessible from Nice airport in France, and property prices here are more affordable compared to its French counterpart.
Moving northward, Lombardy stands out as a preferred destination for expatriates. This region is adorned with lakes, mountains, and the dynamic industrial city of Milan as its capital. Lombardy proudly hosts the largest concentration of UNESCO World Heritage sites in Italy, with eight out of the country's 58 sites.
For the wealthy investors seeking a historical location, Tuscany is an exquisite choice, especially the famed 'Golden Triangle' encompassing Siena, Florence, and Volterra. This region boasts some of the most exclusive real estate in Italy, and it holds the legacy of the Italian Renaissance.
Neighbouring Umbria, called the "green heart of Italy," has much in common with Tuscany with its medieval hilltop towns, olive groves, dense forests, and rolling hills.
Halfway between Rome and Florence, it is a perfect base for visiting all Central Italy and is often chosen as an ideal destination for those seeking inspiration and spirituality and desiring a tranquil and authentic setting away from mass tourism.
It is renowned for its culinary delights, particularly black truffles, chocolate, and wine.
The central part of Italy is completed by the third of its sister regions, Le Marche, which boasts a marvellous territory capable of offering both mountains and sea and a beautiful countryside with a landscape of hills embroidered with vineyards and cultivated fields that reach up to lap the slopes of the hilltops on which characteristic historic villages culminating in typical church bell towers.
The southern region of Puglia is also gaining attention, not just for its delightful wine but also as a promising investment destination for the splendid sea and the traditional architecture of the trulli and masserias, unique with their primitive charm.
Navigating the purchasing process
While investing in Italian property offers numerous rewards, navigating the buying process can be intricate for those who come from a different country and are unfamiliar with its rules. Engaging a reliable agent, especially if you are not familiar with Italian, is crucial. Collecting comprehensive information and documentation about the property before making an offer is advisable.
When budgeting for a property purchase, be prepared to add 10-12% on top of the asking price (all included: Purchase tax, Agency and Notary), although this can vary depending on property type, resident status and location. It is customary for the agent's fee to be split between the buyer and seller.
Completing a sale
To complete the property sale, a public Notary is appointed to ensure legalities, paperwork, taxes, and finances are in order. The seller must provide ownership title, floor plan, cadastral documentation, energy certificate, building permits references, and identification, while the buyer requires an Italian tax code (the agency can take care of requesting it) and ID. Only the notary has the legal authority to transfer the property's title.
Taxes, incentives and visas
Italy offers various tax breaks and incentives to promote building renovation, to improve energy efficiency, and attract high earning residents.
If you plan to make Italy your primary residence, you'll enjoy lower taxes, at only 2%, while 9% applies in the case of second homes or luxury properties. Except in special cases, it is possible to apply these percentages (2% or 9%) on the cadastral value, which is usually much lower than the actual purchase price.
Furthermore, main residences are exempt from IMU / TASI taxes and benefit from reduced electricity charges.
For non-EU citizens who wish to stay longer than the permitted 90 days in any 180-day period, there are different visas and resident permits available. The Italian Embassy or consulate can provide guidance in this regard. Financially independent individuals and couples may qualify for the Elective Residence Visa, although the annual income limit may be higher than in other countries.
One attractive feature for property owners is that there is no Capital Gains Tax on property sales after five years of ownership or if the property serves as the main residence.
For those who wish to use the property only for a few months per year, an interesting possibility is listing the property in the international circuit of tourist rentals on a weekly basis: an excellent opportunity that allows to abundantly cover all annual operating expenses and keep the property always in perfect condition.
In conclusion, Italy stands as a jewel among European countries, offering a plethora of attractions for both tourists and overseas property investors. Its rich history, vibrant culture, breathtaking landscapes, and favourable investment climate make it a compelling choice for those seeking to immerse themselves in the essence of Italy while making a sound financial decision. With proper guidance and understanding of the purchasing process, investing in property in this beautiful country can be a rewarding and enriching experience.
If you are looking for a property in Italy, please get in touch.
Author:
Alasdair Hedley
Head of International
