Buying Property in Italy as a Foreigner: The Complete Legal Guide

An agent emails a two-page purchase proposal in Italian, asks for a signature and a small deposit to hold the property, and mentions that another buyer is interested. Many foreign buyers sign that evening. In Italy, that proposal can already bind you the moment the seller accepts it, before anyone has checked the title, the building permits or the condominium accounts. Foreign buyers rarely lose money in Italy through fraud. They lose it by committing early, in a legal system that treats early documents as more binding than they expect.

This guide explains how a property purchase works in Italy from the first proposal to the registration of the deed: what each document commits you to, which checks protect you, and what the transaction costs. It is written by Alfredo Esposito International Law Firm, an English- and Spanish-speaking Italian law firm based in Naples and listed with six diplomatic missions in Italy (United States, United Kingdom, Canada, Switzerland, Spain and Colombia). We assist expats and foreign investors throughout the purchase, often entirely from abroad.

Can a foreigner buy property in Italy?

Yes. Residence is not a condition of ownership. EU citizens buy on the same terms as Italians. Non-EU citizens can buy where a reciprocity condition is met between Italy and their country, which covers most nationalities, including citizens of the United States, the United Kingdom, Canada, Australia and Switzerland. Owning a property does not by itself grant residency or a visa: relocation plans need to be arranged separately.

A few categories of property carry extra rules. Agricultural land is subject to a statutory pre-emption right in favour of neighbouring farmers, and listed historic buildings give the State a pre-emption right on the sale. These rules do not stop the purchase, but they change its timing and must be handled in the contract.

Before you start looking

Three things should be in place before you make an offer.

The codice fiscale, the Italian tax code, is required to sign any contract, open a bank account and pay taxes. It can be obtained at an Italian consulate or, more simply, by our office under a power of attorney. See our codice fiscale guide.

Funds and financing. Italian banks do lend to non-residents, typically up to 50 to 60 percent of the value, against proof of income, tax returns and bank statements. Assemble these early: a financing condition in a preliminary contract has a deadline, and the protection is lost if the paperwork is still being chased when it expires.

A power of attorney, if you cannot be in Italy for every stage. A procura signed abroad before a notary and apostilled lets a trusted person, usually your lawyer, sign the preliminary contract and the deed on your behalf. Our guides on power of attorney in Italy and the apostille explain the formalities.

The five stages of an Italian property purchase

1. The purchase proposal (proposta di acquisto)

The agent’s proposal is usually drafted as an irrevocable offer valid for a set number of days, often accompanied by a cheque held by the agency. Once the seller signs it, a binding contract exists on the terms written in it. This is the document most often signed without legal review, and it is the one that decides whether you can later add conditions, negotiate repairs or walk away. Have it reviewed before you sign, or at the very least make sure it is expressly conditional on satisfactory legal and technical checks.

2. The preliminary contract (compromesso)

The compromesso, or contratto preliminare, is the binding agreement in which both parties undertake to complete the sale. It fixes the price, the deposit, the completion date and any conditions, such as mortgage approval or the regularisation of building works. It must be registered with the Agenzia delle Entrate within 30 days. It can also be recorded in the property registers (trascrizione), which protects you against the seller’s creditors and against a second sale in the period before completion. That protection is often skipped to save the extra notarial cost, and it is usually worth having when a large deposit is paid. Our guides cover how to sign a preliminary contract safely and what happens after you sign.

3. The deposit

Italian law distinguishes three kinds of payment made before completion, and the label matters. A caparra confirmatoria is the standard deposit: if the buyer defaults the seller keeps it, if the seller defaults the buyer can claim twice the amount. A caparra penitenziale is the price of an agreed right to withdraw. An acconto is a simple advance on the price with no penalty function. Deposits are typically 10 to 20 percent of the price and should be paid to the seller by traceable transfer, or held by the notary, not handed to the agency without a written escrow arrangement. Full detail in our article on caparra, escrow and refunds.

4. Due diligence

Ideally the checks are done before the proposal is accepted; at the latest, between compromesso and deed, with the contract conditional on their outcome. The core checks are:

• Title: the twenty-year chain of ownership and any mortgages, seizures or easements, through the property registers (visure ipotecarie) or a notarial title report
• Cadastral data (visura catastale) and whether the registered floor plan matches the actual property
• Planning and building compliance: permits for the original construction and for every later modification, and the certificato di destinazione urbanistica for land
• Energy performance certificate (APE), which is compulsory
• Condominium position: unpaid charges, approved works and pending litigation, since the buyer is liable together with the seller for the charges of the current and the previous year
• Occupancy: tenancies, rights of use or family members living in the property

Unauthorised building works are the single most common problem in Italian purchases and can make the deed void or the property unsellable. We cover the checks in depth in our guides to remote due diligence, what to verify in person, surveys and technical reports and title deed problems.

5. The deed (rogito) before the notary

The final deed is signed before a notary, a public official who verifies identities and title, drafts and reads the deed, collects the taxes and registers the transfer. The notary is neutral by law and does not advise either party. If you do not understand Italian, the deed must be read with a sworn interpreter or drafted in two languages, or signed through a power of attorney. Payment is made by banker’s draft or bank transfer, and the means of payment are declared in the deed. Since 2017 the buyer can ask the notary to hold the price in a dedicated account until the transfer is registered, an additional safeguard when there is any risk of intervening claims. On completion the notary registers the deed and records the transfer in the property registers and the cadastre. Read our comparison of notary and lawyer: who reviews what.

Costs and taxes when buying

Purchase taxes depend on who the seller is and on how you will use the property.

• Buying from a private seller: registration tax of 9 percent of the cadastral value (not the price) for a second home, reduced to 2 percent for a prima casa, plus fixed mortgage and cadastral taxes of 50 euro each
• Buying from a developer: VAT at 10 percent of the price (4 percent for a prima casa, 22 percent for luxury categories), plus fixed taxes
• Agricultural land: 15 percent registration tax for non-farmers

The prima casa reduction is available to foreign buyers too, on condition that you take residence in the municipality within 18 months of the deed and do not own another prima casa in Italy. Notary fees are usually between 1,500 and 3,000 euro for a standard residential deed. Agency commission is normally 2 to 3 percent plus VAT from each side. Legal fees are agreed in advance: see how lawyer fees work in Italy. A budget of 10 to 15 percent of the price for all costs is realistic for a second home.

After completion, the annual municipal tax IMU applies to second homes and is not due on a non-luxury prima casa; TARI covers waste collection. Our IMU guide and property tax guide cover the details.

The mistakes we see most often

• Signing the agent’s proposal without conditions, then discovering unauthorised works and having no way out
• Paying the deposit to the agency or directly to the seller without escrow or a registered preliminary contract
• Relying on the notary as if the notary were the buyer’s advisor
• Accepting a floor plan that does not match the property, which blocks the deed or a future sale
• Underestimating condominium debts and approved works that pass to the buyer
• Buying through a foreign company without checking the tax consequences in Italy

If a deal has already started to feel wrong, our article on legal exit options for expats explains what can still be done at each stage.

After completion

Utilities are transferred into your name, the IMU position is set up with the municipality, and residence is registered if you intend to claim prima casa benefits. If you plan to rent the property short term, a national identification code (CIN) and local registration are required before advertising it. Owners living abroad should also consider how the property will pass on death, since Italian forced-heirship rules may apply: see inheriting Italian property as a foreign owner.

Related guides

• Types of property ownership in Italy: full ownership, usufruct, bare ownership and co-ownership
• Italian real estate terms and misleading listing wording
• Contract clauses that protect foreign buyers
• Buying property in Naples: local guide

Have the first document reviewed, not the last

Most of what can go wrong in an Italian property purchase is decided in the earliest paperwork: the proposal, the reservation agreement, the compromesso. By the time you sit in front of the notary, the terms are largely settled. If an agent has sent you a proposal to sign, or a seller is asking for a deposit to hold a property, that is the moment a review changes the outcome. Send us the document, the listing and anything you have been told about the property’s history, and we will tell you what it commits you to and what is missing from it.

Alfredo Esposito International Law Firm works with expats and foreign investors across the whole purchase, in English and Spanish, from the first proposal to the registration of the deed. Contact us or book a 15-minute call.