The 20 most common mistakes when buying a property in Italy

Buying a house is one of the most important decisions and probably the main investment in most people’s lives, and yet the same mistakes are often made again and again. Buying property in Italy can be profitable, but it has its pitfalls.

After years of crisis, the Italian housing market is recovering. The latest figures speak of a recovery in sales and the banks have also started to provide funds again. This, combined with historically low interest rates, can make now the right time to take the plunge and buy a home.

Find out with idealista what to have under control to avoid making fatal mistakes:

1. People generally don't calculate their finances properly. In Italy, according to several international studies, there is not a culture of financing. Buying a home is the biggest investment for many people, but they don't have enough financial preparation to afford it.
2. Many people forget to add 10% of expenses to the total price of the property. As well as the VAT (if the property is new) or the imposta di registro registration tax (if it’s a second-hand property), there are other cadastral taxes. That’s not even to mention the possible deposit, which, although it is made back, still remains a considerable initial expense.
3. Not taking into account that the mortgage loan involves expenses and taxes. Mortgage tax is usually about 2% of the loan amount, and many banks require you to take out mortgage insurance to protect against risks such as job loss or death. It is useful, but it is by no means a small expense.
4. Taxes and additional charges. Buyers often forget that homeownership involves monthly community fees and other extras that can increase the price significantly. Properties require maintenance and the other common expenses can include upkeep of the facade, the antenna, elevator and more. In the case of detached houses, the costs can be even higher.
5. Money for furniture and incidentals. When a budget is made, expenses for furniture are usually left out and no extra funds are allocated for contingencies that are not directly related to the house but can lead to a crisis in the family's budget all the same, such as the car breaking down a couple of months after buying the house.
6. Not asking for a property tax report. Ninety-nine percent of people who buy a home do not find out in advance what taxes are due, which is a big mistake.
7. Not considering the Euribor in the case of an adjustable rate mortgage. If the Euribor is at its lowest point, you have to take into account when it will be at its highest point.
8. Applying for a long-term mortgage. If the mortgage term is more than 25 years, it's not worth buying: after calculating all the interest, the house becomes too expensive.
9. Borrowing more than 30% of your income. The Bank of Italy recommends that the portion of the mortgage, added to the rest of the debts (credit card, personal loans, etc.), should not exceed 35-40% of the income of the mortgage holders.
10. Asking parents, friends or relatives to be guarantors. When you buy a house, you have to take the responsibility for it. If the situation gets complicated, you can drag other people into your problems. If you can't afford the house right now, don't buy it.
11. Often, buyers can lose all sense of what it means to be expensive or cheap. You have to look for statistical information and compare market prices. The information can be found in many ways, from local real estate agencies to reports from the Bank of Italy, and also through real estate websites.
12. A lot of people buy houses thinking that prices always go up. Recent experience has taught us that real estate does not always increase in value.
13. Not listening to agencies. Right now, you can save money by going through a real estate agency. The purchase can be negotiated and real estate agents know how to do it well. For this reason, they may have more freedom to act to lower the price and convince the seller to give a substantial discount.
14. Not discussing the price until the end. Many potential buyers discard some properties because they think they can't haggle on the price. Be prepared to negotiate and always have a counteroffer available, but always after you have done your calculations. Another mistake is to accept a price in the middle of the deal for fear of losing the house.
15. Let yourself be led by your emotions. Sometimes buying a home is more emotional than rational and this can make the purchase go wrong. If you feel tired or unmotivated after months of searching and researching, it’s easier to make bad decisions. Take time for reflection.
16. Thinking that the prices won't fall. There is still no clear evidence of a generalised recovery in housing prices. Only some partial data confirms that they have been maintained in certain areas. Just because prices in the centre of Milan or Rome have risen, that doesn’t necessarily mean they will do so in the suburbs.
17. Speculating on the house. The house must be a consumer good. If we buy it as a residence, we have at least have a bed to lie in. If we buy it to speculate on its value and then things go wrong, we will have destroyed our finances for many years.
18. Not considering whether it might be better to rent. In Italy, the culture of ownership is deeply rooted. Living in rented accommodation is an option that many people don't even consider. Be sure to consider and think about the possibilities offered by renting, such as making it easier to change jobs and cities. If the economic difference between owning and renting is very large, you can create a pension fund with savings, for example.
19. Buying a house is not like buying a car. It is a decision that may have repercussions in the next thirty years, a period in which anything could happen: births, deaths, divorces, job opportunities in other states or in other cities.
20. Not consulting a notary before signing important documents such as preliminary purchase and sales agreements. For example, not everyone knows that donated assets are subject to revocation by any heir. For this reason, many banks do not grant mortgage loans for the purchase of a property from a donation. In this case, as in others, expert advice can avoid unpleasant surprises.