Choice of Property, Searches & Negotiations
To begin with, the foreign buyer will need to select the area in Italy where they wish to buy their property, decide which type of property they wish to buy and whether to operate directly on the open market or to seek the assistance of a local agent (Mediatore or Agente Immobiliare).
If, as frequently happens, an agent is appointed, it is important to select the right person. Under Italian law the agent is paid a commission (Provvigione) both by the buyer and the vendor, if it is a Mediatore, or only by the buyer if it is an Agente Immobiliare. It is possible to agree other legal arrangements, whereby the agent is paid by the buyer or the vendor only. Usually, the Mediatore has a duty to put both parties to the contract in touch with each other, and to inform each of them of anything known to him which may be material or relevant to their clients.
Under Italian law an agent must be registered with the local Chamber of Commerce, and should also lodge with the Chamber of Commerce a specimen of their draft terms and conditions. This will involve a form of supervision, and ensure a minimum of professional qualifications. Where the agent is not registered, he will be liable to fines and other penalties and, more importantly, will not be entitled to the commission.
Frequently, in dealing with an Italian agent a foreign buyer will be required to sign a standard contract, (obviously written in Italian unless dealing with an English speaking company) which should carefully be considered before signature. This applies especially to the term relating to the amount of commission and the time when it will become payable. As mentioned earlier, this or other documents offered for signature frequently include a "booking" for the particular property (Prenotazione) and the payment of a deposit. The signing of these documents at such an early stage is to be avoided if possible, but if payment is made, the contract should expressly state that any payment effected by the foreign buyer is on account of the purchase price for the property in question. Other restrictive clauses may be included, such as limitations of liability, lack of any commitments on the part of the seller, etc. The presence of these one-sided clauses are usually shown to be evident by the tell tale request to sign the same document twice. This is a requirement of Italian law for unfair, unbalanced or unusual clauses, and should be a warning to the foreign buyer.
Italian law requires both parties to a prospective transaction to act in good faith. Thus, before any form of legally binding obligation is accepted it is normal for the vendor to pass to the buyer or their legal advisers, copies of all the documentation relating to the property, and to inform them of any material fact which may affect the decision of the foreign buyer to proceed with the purchase. At the same time, and before considering any draft contract, the foreign buyer or (Acting Consultant/Agent) should organise a survey of the property and effect all the searches required to satisfy themself that the property is what it has been described to be and is legally saleable.
In particular, and with the assistance of independent professionals, the foreign buyer will need to check that:
- the property exists, it is as described, and belongs to the prospective seller who, in turn, must have a valid title to sell it, and
- there are no third parties' rights, mortgages or other undisclosed/encumbrances affecting the property, (or, if there are any, they should be considered with great care), and
- the property complies with all the applicable local planning and building regulations, and with any relevant building plan approved by the Local Authority (Comune). The property must also be fit for human habitation unless purchasing to re-construct and a certificate to this effect (Certificato di abitabilit?) should normally be available, and
- the vendor has complied with all the relevant Italian tax legislation by lodging tax returns, and paying income tax (Imposta sui Redditi), which may have been due in the previous tax years. In default of this requirement, the property may be legally un saleable, and
- - where the vendor is a trader or a company, they should not have been adjudged bankrupt (Fallito), and no application to this effect should be pending against him.
- where the property is in a block of flats (Condominio) , all service charges due should have been paid.
It is important to ensure that the property complies with any planning or building regulations which may be applicable, and this should be considered with great care. Breach of this legislation may result in the avoidance of the purchase contract and heavy penalties. In case of breach, if the vendor has applied for the benefit of a Planning Amnesty (Condono Edilizio) as introduced by law since 1985, it will be necessary to obtain copies of all the documentation, and to check that it is complete and in order. All required returns should have been lodged with the authorities and charges effected within the statutory deadlines.