Interestingly, you will not find a section dedicated to purchasing a house and this is intentional. Some of the contributors to this blog have purchased a home in Italy and the facets are intricacies are too many for this blog to appropriately cover. Thus, we will be focusing on what we recommend the most, renting. After all, buying and selling properties in Italy is not as dynamic as it could be in most parts of North America. IF you buy, selling could be very difficult. It is true that Italy does not have property taxes on your first home, but at the same time getting a loan is very difficult.
Renting a Property
Homes comes in many forms, from large estates, to single room studios. We will be focusing on the most common, which are either single-family homes or apartments in a condominium. Single-family homes are rare in the center of town, unless they are very large, and they are more common outside town. Usually, they are not part of a condominium unless they are in a gated or private community in which homeowners share ownership and maintenance costs of the grounds and any other amenity that may be present such as tennis courts or swimming pools. This kind of housing tends to be expensive.
Most commonly, you may be looking at an apartment close to or downtown (centro storico). In very small towns, probably there would be no condominium but just shared ownership of common areas (right of way), while in a larger city there will be a condominium with a property manager. Condominiums in Italy are the source of endless jokes due to the well-known acrimonious nature of their meetings. It is said that if the courts could suddenly eliminate all litigation relating to condominium affairs, the justice system would start working again. As a renter, you will not have to endure these meetings. Do not be surprised if your next-door neighbor just says hello to you or if he\she never approaches you directly with an issue. Instead, it is common to write a nasty letters to the administrator accusing neighbors of misdeeds. As we said, condominiums in Italy are weird.
Getting an Agent
While you could look for an apartment on your own, we do not recommend it. There is a lot of paperwork involved and many critical steps that only a licensed real estate agent would know how to navigate. Avoid business mediators; go for a fully licensed agent. They are usually licensed land surveyors (geometra). The agent will cost you the equivalent of one-month rent, but you could negotiate a lower fee. Finding an English speaking agent is not going to be easy, so just look for a reliable agent that others have used and then use a third party to help with any translations (unless you are fluent in Italian). This way, you get two opinions.
What you are used to at home will seldom translate to Italy. Even if you are from New York and live in an apartment building, in Italy things will be different. The agent will be your navigator and help you avoid undesirable neighborhoods, shabby buildings, or unpleasant proprietors.
The whole process is less structured than what you may be used to, but at the same time a bit confusing. There is no credit report to be filled since it will be the agent introducing you to the owner(s) and foreigners from certain countries are highly desired. A property will be shown, a monthly rent and type of contract agreed upon and then a contract signed; that is it. That will be the end of the relation with the owner unless you fail to pay rent of there are extraordinary events related to the property. This will be explained later.
There are five different types of contracts allow under Italian civil law:
- Regula contract with unregulated rent (Contratto ordinario a canone libero (4+4))
- Temporary Contract (Contratto transitorio)
- Regulated Contract (Contratto di locazione convenzionato o a canone concordato (3+2))
- Temporary Student Contract (Contratto transitorio per student)
- Free Use (Contratto di comodato d’uso)
Let me clarify right away that four and five do not apply to you. If someone is trying to sell you one of these two types of contract, they are breaking the law. Especially the last one because payment would be under the table and thus constituting tax evasion for which you would be criminally liable. Thus, let us focus on the other kinds.
A temporary contract is only valid up to 18 months and it could be a viable option if you are just trying out a town and you know that that the place you want to rent is not going to be your final one. Usually, these apartments are partially of fully furnished. Keep in mind that any other form of rental, such as what you would do with a B&B, is limited to 30 days. Thereafter, you have to move out. Moreover, to establish residency – you will have to – you have to have a rental contract. On cannot establish residency using a B&B or a hotel.
The two remaining options will be what the agent and the owner will offer you. The first one if for 4 years. If the owner does not give you formal notice at least 6 months before the end of the contract and needs the apartment back for good reasons (such as moving in himself\herself or a close family member – wanting to increase rent is a not a valid reason) then it is automatically renewed. This kind of contract allows for rent increase, but they are regulated. In essence, it is an 8-year contract from which you can rescind at any time giving a 6-month notice.
These days, the most common contract is the regulated one because the owner receives a substantial tax break on the income. These contracts are similar to the one described above, but with a duration of 3 plus 2 years. Rent increase is regulated by the government and it is minimal. In most cases, is not even implemented.
As said, if you want to break your lease, usually you must give a six-month notice. If the owner wants the apartment back, they must offer compensation and you may always refuse to move out. It will take the courts a long time to establish who is right, often years. Security deposit is usually the equivalent of two-month rent and, in theory; the owner should pay you interests on your deposit.
In actuality, if you want to leave before the six months, have the agent negotiate. Finding a good tenant who pays reliably is hard, so the owner will usually do whatever it takes to assist you, unless you are a chronic complainer. Let me spell it out, you are going to be a ‘premium’ tenant. In many cases apartments are not advertised because the owner rents only to ‘special’ people; you would be one of them.
The rental agreement will have to be recorded. This will require your tax number ‘Codice Fiscale’. So, remember that getting your tax code is the most important first step. Ordinary maintenance will be your responsibility, plus some extraordinary one. This is very different from the USA, so let us expand.
Especially for furnished or semi furnished apartment, make sure to have the agent conduct a full inspection. Once you take possession, anything broken will be your responsibility. Here are some steps before you take possession:
- Take a detailed inventory
- Take pictures
- Do a walkthrough with both the agent and the owner
- Test all appliances: heater, A/C, appliances, plumbing, shutters, keys, TV outlets, power outlets, etc.
The most expensive repair you may face is the boiler (caldaia), so make sure you receive an up-to-date inspection booklet and verify that the unit is not too old. If it is, have the owner agree to replace it. Aswe listed above, inspect all electrical outlets, TV outlets, speakerphone (citofono), heating and cooling (if present), windows, shutters and especially appliances. Check with the condominium what your responsibility is and what they cover. It could be that you have to repaint the outside shutters and that could be costly.
Once you move in, you have full use of the apartment and the owner may not come in unless you received a certified mail from the post office in which a date, a time and valid reasons for entering the premises are specified. You will have to be present because the owner will not have the keys. Entering the house without your permission is a felony.
You can make any minor modification without having to request permissions, but for anything major, you should. It is good practice to have the agent talk to the owner because this professional will be able to provide for the necessary filtering. Remember, it is not just the language: often the different culture gets in the way.
Remember that there will be additional costs for transferring utilities and those are documented in the utility section. Make sure to verify that the previous occupant paid all utilities up-to-date, or you will not be able to have the service transferred over to you. So, before closing the deal, ask for copies of the latest utility bills.
There will be two additional costs, condominium fees and T.A.R.I., the garbage tax. Condominium fees will only include ordinary costs, extraordinary, such as major repairs, will be the responsibility of the owner. Before you rent, check what the current condominium fees are. The garbage tax is not only your responsibility, but you also have to go to City Hall and change the tax bill into your name. We cover this tax in the tax section, but be prepared because it is based on the size of the apartment and it could be very expensive.
Does and Don’t
If possible, always have the agent deal with the owner. If you have to communicate, keep it to business and do it in writing. Official communications, such as your desire to leave the property, will require a certified mail.
Get copy of the condominium rules. Technically, you should get it as part of your contract, but you will not. Have someone translate it for you. If you have a pet, make sure that there are no restrictive rules. Usually they are illegal, but why getting into a controversial situation if it can be avoided?
If you are gone for extended periods, secure the apartment by turning off water and ga but especially have someone come over and check it out at least once a month.
You are not required to have insurance, but we highly recommend it. This is mostly liability insurance in case you cause damage to others. Remember that if you have a water leak and damage the apartment below costs could be very high and you, not the owner, would be liable. Spend little money and sleep well by having insurance coverage. You can also get theft insurance, but usually it will only cover a limited amount. If you have valuable items, you will have to have them appraised and documented.