If you’re thinking about buying property in Italy, there’s a lot to get your head around. In the first instance, your Italian dream may seem out of reach. After all there’s a language barrier to contend with, different tax laws, investment rules, banking legislation and so on. However, with iad Overseas ready to help, your Italian dream can quickly become a reality.
Whether you want to invest in Italian property as a second home, relocate, purchase a holiday residence or to add to your portfolio, there are many things to consider. So, what are the key reasons to invest in Italy?
6 reasons to invest in Italy
- Italy is a member of the European Union and Eurozone, which makes it a great option for EU residents and an attractive option for non-EU nationals.
- Every corner of Italy offers something different. From the stunning beaches of Aquila to the scenic backdrops of Tuscany, or the busy cities of Rome or Venice bursting with history and culture, every taste is catered for. Add in the warm summers and mild winters, and it’s a top choice for expatriates.
- Italy is an ideal location for further travel. It borders France, Switzerland, Slovenia, Austria and Monaco, there are countless picturesque islands to explore, and it is easily accessible by air (there are a total of 77 airports and one in almost every main city), land and sea.
- In recent years, the Italian Government has introduced numerous tax incentives for foreign nationals who transfer their tax-residency to Italy. Whilst the tax rules vary between regions and are subject to a strict criterion, it does mean more than half of any income generated is tax exempt.
- In Italy, food isn’t just something you eat, it’s a way of life. Whether you’re a dedicated foodie or just want to explore your palette, Italy is the place to do it. There’s so much more on offer than just pizza and pasta and it’s a true treat for all the senses.
- Italians work hard, play hard and relax even harder. Here, the work life balance is all about getting things done whilst making sure you enjoy life and all it has to offer. An ideal place if you want to get away from the rat race and enjoy a more tranquil pace of life.
There’s something about Italy that conjures up fantasies of romance, long relaxing lunches in the sunshine, fashionable city centres and stunning coastlines.
Despite this beauty and culture-rich reputation, lots of British expats choose countries such as Spain and Portugal instead. Perhaps it seems easier, and less challenging to move where so many others have moved before. But could you be missing out on the hidden gems of the Italian dolce vita?
Here we look at the different regions of Italy and what they have to offer.
Shaped like a boot, this 302,073km2 southern European country has a population of nearly 60 million and is renowned for its historical contribution to art, music, and fashion.
It can be roughly divided into three sections, with each offering something completely unique to its inhabitants.
The busy cities of Milan and Venice offer modern living alongside iconic historical architecture. The hustle and bustle of the Northern cities are balanced out by the stunning landscape of the Italian Alps and the picturesque towns in the Lombardy region surrounding Lake Como and Lake Garda (home to the rich and famous). The Lakes are extremely popular with wealthy foreign buyers, whilst Liguria is great for people looking to invest in holiday homes.
From the rolling hills and olive groves of Tuscany to the capital city of Rome, in Lazio – central Italy is bursting with culture, diversity and history. If you love history and wine, you’re in the right part of Italy to satisfy both desires.
Tuscany is true wine country and offers land and property at higher prices than the similar, more rural, yet equally breath-taking areas of Abruzzo and Marche.
From Sardinia to Sicily, the Amalfi Coast to Puglia – the ‘heel’ of Italy offers a sun-soaked climate and competitive property prices. In fact, the gorgeous coastline around Calabria boasts some of the cheapest property prices in the country. However, this is in part down to the fact it’s more remote and less connected than other seaside areas.
The cost of living in the South is far less than other regions of Italy and the lifestyle is much slower and relaxed.
There is lots to explore and do in Italy, but before investing or making plans to relocate, make sure you research your chosen region carefully. For example, if you’ve got a young family your needs may differ to a couple looking for suitable retirement options.
Current prices In the Italian housing market
The property market is unpredictable at the best of times, but as Italy puts the global pandemic behind it, the market seems stable, experiencing small levels of growth. However, whilst property prices are on the up, the uplift has been minimal. Prices per square meter currently average €1,967 (in March 2023) compared to €1,934 in the previous year.
Prices vary from region to region. Some popular areas such as Liguria are seeing prices of €2,539 per square meter and Trentino Alto Adige at €3,138 per square meter. Property prices in the south of Italy are considerably lower, with areas such as Sicily and Molise under €1,200 per square meter.
The Banca D’Italia’s quarterly Italian Housing Market Survey found there was a downward trend in new sales listings and a decrease in the number of potential buyers. This lower demand for property from Italian nationals, may mean the market is more favourable for foreign investors, so now could be the right time to start looking.
Investing in Italian rental property
Whilst the demand for rental properties in Italy is strong, as a foreign investor it’s important to think about the type of property and region you’re investing in to understand what your returns will be. For example, are you buying a holiday let? Or a city flat? There is demand for both, however, the region you choose to buy in will be of utmost important. Speak to our iad advisors to work out what’s best for you.
Recent research has shown that landlords can expect rental yields of anywhere between 12.4 per cent and 6.1 per cent depending on the region of investment. Southern Italy offers the highest return, whilst central Italy offers the lowest. Cities such as Rome and Milan, vary between approximately 6% rental yield and 5%.
How to purchase your Italian property
There are no rules or restrictions on foreign nationals buying or selling real estate in Italy. For more detailed information on the process of buying property in Italy, our iad Overseas consultants* can help. For a quick overview of how the process works, read on.
- You will need an Italian bank account and tax code before you start your property search. It’s also important you have a lawyer to guide you through the legal steps of purchasing a property.
- Once you’ve found the property you want to buy, you will need to make a written offer of purchase which outlines the amount you are offering, evidence of the deposit, and a deadline for the seller to accept or reject the offer.
- If an offer is accepted, your legal representative will draw up a ‘compromesso’ or a preliminary contract setting out the details of the sale.
- Once the compromesso is signed, the deposit (typically between 20 to 30% of the purchase price) needs to be paid. This is dealt with by a notary, an officer of the Italian State.
- The usual property searches and contract preparations will be carried out. The final contract signing will need to be witnessed by a notary and the outstanding purchase cost, fees, taxes and so on will be paid.
Your lawyer will advise you of your tax obligations, however, it may be a good idea to speak to an Italian finance advisor to fully understand the cost implications of buying property. Our team can refer you to the relevant professionals to help navigate the Italian tax system.
How iad can help you
iad has consultants* based in 8 different countries, including Italy. So, if you’re considering relocating or investing, our agents are here to help. They are fluent in English and Italian and will be able to support you throughout.
Our iad Overseas consultants* work closely with immigration experts, financial advisors and a whole host of professionals that can make your move (or investment) as stress free as possible.
We can help you find your dream home in the right region of Italy and for the right price. We offer value for money, useful advice, and a network of professional contacts.