# Buying in Italy - Buying slowly.



## KenzoXIV (Nov 13, 2013)

Hi all,

Just thought I would ask an out there question.

My Sicilian father in law brought his house 8 years ago, in his words, slowly and privately. It helped him not needing a mortgage and saved him a fortune in interest.

My question really is has anyone ad experience of this and how does it work..not the details as such because that would be agreed between interested parties but more so things like:

1/ Who owns the property while payment is being made,
2/ Can I modify the house while making payments,
3/ What would happen if either party changes mind mid way through, or an unexpected death etc.
4/ What type of legal representation would I need to make this agreement

Thats probably a good starting point but I am sure more questions will appear as time goes on:confused2:

As always any and all help welcome 

Kenzo


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## NickZ (Jun 26, 2009)

The normal process is

You make an offer and when it's accept you provide the deposit. This can be fairly small.

Whether or not you're allowed to do any work is up to the seller. They can say yes or they can say no. But with the market today being so slow almost anybody sensible will say YES!. It doesn't hurt if you back out the money spent on the work is your problem.

If you back out you'll lose your deposit. The seller back out? You could sue but with the market so slow highly unlikely.

Usually you use an agent to act between you and the buyer. In theory they're supposed to be neutral. It wouldn't hurt to use a lawyer especially if what you're doing is complicated.

I get the impression you aren't asking about the normal way. 

You might want to google affitto con riscatto . Which is sort of a lease. You pay a deposit up front. Then pay rent for a period (one,two or more years usually) you then pay a final balloon payment. 

It's easier for the buyer because they need a smaller mortgage sometime in the future for the balloon payment. The seller sells a house they would otherwise have problems selling these days.


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## KenzoXIV (Nov 13, 2013)

NickZ said:


> The normal process is
> 
> You make an offer and when it's accept you provide the deposit. This can be fairly small.
> 
> ...


Hi Nick,

Yeah the normal way isn't what we are looking for :heh:

In essence our situation is we are currently renting the house at €500 a month.

The owner wants 150k but the house was valued at 125k. Getting a mortgage at this moment in time is a little more hassle than we wanted to handle, but we also don't want to rent much longer and this house is in desperate need of modernisation!

We were thinking to pay €650 a month to the owner over 20 years.. we are all still relatively young....ish... this would give the owner the 150k plus a bit more, without really killing our cash flow... obviously with such a slow market I thought he might be tempted. He would also keep the last two years of rent so ultimately he will have done well, just gotta wait a while, my thinking is its a nice little pension for him and he wouldnt have the responsibility of the maintenance for the house. Obviously if in the future situations change and we could pay off quicker we would.

I have spoken to my family in the UK and they said the owner would be nuts to accept that because people selling property want a lump sum, but I cant help but feel that is a very English attitude and Italians might be better persuaded.

Thoughts? Using this method he could receive at least €156k for a house valued at €125k with no more maintenance costs, property taxes etc.

Kenzo


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## NickZ (Jun 26, 2009)

Basically you're suggesting affitto con riscatto. It's being done by builders in Italy.

https://www.idealista.it/news/etichette/affitto-con-riscatto

https://www.idealista.it/news/immob...ono-lopzione-dellaffitto-con-riscatto-annunci

The only thing unusual in your case is the twenty years.


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## KenzoXIV (Nov 13, 2013)

NickZ said:


> Basically you're suggesting affitto con riscatto. It's being done by builders in Italy.
> 
> https://www.idealista.it/news/etichette/affitto-con-riscatto
> 
> ...


Hi Nick,

Thanks for the links, how long do you think is reasonable in this case and what sort of deposits/balloon payments do you think would be expected?

Kenzo


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## NickZ (Jun 26, 2009)

No idea. The builders are doing two to four years. But if the two of you agree it's anything you pick. The balloon depends on your payments. Basically the idea is what you pay in "rent" is deducted fully from the purchase price. Deposit etc depends on how desperate the seller is. 

Let's put it this way. I've been looking at places in the province of Rome. The initial deposit isn't much more than a fancy smartphone. There are houses that have been on the market for almost a decade and every six months or so the price drops. I'm not going to say they'll accept virtually anything but sellers far out number buyers.


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## KenzoXIV (Nov 13, 2013)

NickZ said:


> No idea. The builders are doing two to four years. But if the two of you agree it's anything you pick. The balloon depends on your payments. Basically the idea is what you pay in "rent" is deducted fully from the purchase price. Deposit etc depends on how desperate the seller is.
> 
> Let's put it this way. I've been looking at places in the province of Rome. The initial deposit isn't much more than a fancy smartphone. There are houses that have been on the market for almost a decade and every six months or so the price drops. I'm not going to say they'll accept virtually anything but sellers far out number buyers.


Yeah down here in Sicily its the same if not worse!

Seller is keeping his cards close to his chest but he really hasnt done anything with the property since inheriting it 5 years ago...

I'll have to test the water soon!

Thanks Nick!

Kenzo


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## NickZ (Jun 26, 2009)

One thing. If you have a seller who hasn't figured out prices have come down you may be better off looking elsewhere. There are sellers with unrealistic ideas of prices. 

At least if there is an agent involved they have an incentive to explain things to the seller.


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## KenzoXIV (Nov 13, 2013)

NickZ said:


> One thing. If you have a seller who hasn't figured out prices have come down you may be better off looking elsewhere. There are sellers with unrealistic ideas of prices.
> 
> At least if there is an agent involved they have an incentive to explain things to the seller.


So I went into Intesa to ask about mortgages and they said that as I am a foreign national I would need a member of my wifes family to garuntee the mortgage... as none of them work (legally:tape that will not be possible.

Seems a little harsh if you ask me, my wifes sister has just got a mortgage in England and she didnt have to have a garuntor at all. She isnt even married to an English man or European...

Anyone have experience getting around this hurdle?

Kenzo


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## GeordieBorn (Jul 15, 2016)

Have you had a look to see if you can get a mortgage in the UK?


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## KenzoXIV (Nov 13, 2013)

GeordieBorn said:


> Have you had a look to see if you can get a mortgage in the UK?


To buy a property in Italy? I did not think this was even possible. 

Any ideas what sort of companies would offer such a facility?

I spoke to Lloyds and they said they couldn't, but then again I ruined my credit rating in the UK during my youth. Silly banks ignorantly lending young men money!:rolleyes2:

Kenzo


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## GeordieBorn (Jul 15, 2016)

I've not looked into it, but do know (before they were told off for lending to easy...) there were adverts around for buying "holiday homes abroad). Just thought it might be worth a look as you never know.


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## Tucsonsteve (Mar 26, 2013)

KenzoXIV said:


> Hi Nick,
> 
> 
> 
> ...




I agree with your family that he’d have to be nuts to accept that deal. Between average inflation and the time value of money, your offer is equivalent to something like 50k in present euros (at a 6% average annual earning rate). Since these concepts are fundamental to banking, which Italy arguably gave birth to, I don’t think it’s a peculiarly English way of looking at it. If he accepts, give me his name and contact information so I can find out if he’s got other properties to sell.


Sent from my iPhone using Tapatalk


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## Italia-Mx (Jan 14, 2009)

The only way an Italian would be persuaded by a deal like that is if you let him continue to live in the house until he dies. This might work for you but only if he's elderly.


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## KenzoXIV (Nov 13, 2013)

Just as an update had a relatively positive conversation with the current owner and the deal looks like it may happen, not exactly as I wrote out but near enough..

There will be risks to it of course but we are all very honest people so hopefully it all works out, time will tell.

Kenzo


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## Light (Jun 9, 2018)

I read that Italian citizens residing in Italy pay no property tax on their primary home. I think it might be the same for permanent residents.

The primary home in Italy for residents that reside primarily at that home are exempt from IMU and TASI. They only need to pay TARI which is for the waste collection service.

I can't post links or I would give a source from late 2016 for the 2017 Italian Tax Year.


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