Authored by the expert who managed and guided the team behind the Italy Property Pack
Yes, the analysis of Milan's property market is included in our pack
If you're reading this, it's likely that the charm of Milan has caught your attention, and you're thinking about investing in an apartment there.
But what does the buying process entail? Is it straightforward? How long should you expect it to take? What challenges might you face along the way?
In this article, we'll walk you through each step of the journey.
Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Italy Property Pack
The Steps to Buy a Condo in Milan
- 1) Research and Choose a Neighborhood
- Understand the different neighborhoods in Milan, such as Brera, Navigli, and Porta Nuova.
- Consider proximity to public transport, amenities, and lifestyle preferences.
- Research local property prices and trends to set a realistic budget. - 2) Engage a Real Estate Agent
- Find a reputable real estate agent who specializes in the Milan market.
- Ensure the agent is familiar with the needs of foreign buyers and can communicate in your language.
- Discuss your requirements and budget to receive tailored property listings. - 3) Visit Properties and Conduct Due Diligence
- Schedule visits to shortlisted properties to assess their condition and suitability.
- Verify the legal status of the property, including ownership and any encumbrances.
- Check for any condominium rules or restrictions that may affect your use of the property. - 4) Make an Offer and Negotiate
- Work with your agent to make a formal offer to the seller.
- Be prepared to negotiate the price and terms, considering the competitive Milan market.
- Once agreed, sign a preliminary contract (compromesso) and pay a deposit (caparra). - 5) Secure Financing and Legal Assistance
- If needed, apply for a mortgage with an Italian bank, providing necessary documentation.
- Hire a notary (notaio) to oversee the legal aspects of the transaction.
- Ensure all legal checks are completed, including property registration and tax compliance. - 6) Finalize the Purchase
- Sign the final deed of sale (rogito) in the presence of the notary.
- Pay the remaining balance, including taxes and notary fees.
- Obtain the keys and officially take ownership of the condo. - 7) Register the Property
- Ensure the property is registered in your name at the local land registry (Catasto).
- Update utility accounts and condominium fees to reflect your ownership.
- Consider hiring a property manager if you plan to rent out the condo.
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What You Need to Know Before Buying an Apartment in Milan
What are the average property prices in Milan?
The average price per square meter for an apartment in Milan is approximately €4,800, but this can vary significantly depending on the neighborhood.
In prestigious areas like Brera or Quadrilatero della Moda, prices can exceed €10,000 per square meter.
Conversely, in more suburban areas, prices might be as low as €3,000 per square meter.
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How long does the buying process typically take?
The process of buying an apartment in Milan usually takes between three to six months from the initial offer to the final deed.
This timeline includes property searches, negotiations, and the completion of legal and financial procedures.
Delays can occur due to complex negotiations or issues with property documentation.
What are the additional costs involved in purchasing an apartment?
In addition to the purchase price, buyers should budget for additional costs such as notary fees, which are typically around 2% to 3% of the property price.
There are also registration taxes, which can be between 2% and 9% depending on whether the property is a primary residence.
Other costs may include real estate agent fees, which are usually 3% to 5% of the purchase price.
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What is the role of a notary in the buying process?
A notary in Italy is a public official who ensures the legality of the property transaction and verifies the identities of the parties involved.
They are responsible for drafting the deed of sale and ensuring that all taxes and fees are paid correctly.
The notary's role is crucial in protecting both the buyer and the seller from potential legal issues.
Are there any restrictions for foreign buyers purchasing property in Milan?
Foreign buyers from EU countries face no restrictions when purchasing property in Milan.
Non-EU buyers may need to obtain a "residenza elettiva" visa if they plan to reside in the property long-term.
It's advisable for non-EU buyers to consult with a legal expert to understand any specific requirements or restrictions.
Buying real estate in Italy can be risky
An increasing number of foreign investors are showing interest in Italy. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
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What financing options are available for purchasing an apartment?
Italian banks offer various mortgage options to both residents and non-residents, typically covering up to 80% of the property's value.
Interest rates for mortgages in Italy can range from 1.5% to 3%, depending on the loan type and duration.
It's important to have a good credit history and sufficient income documentation to secure favorable mortgage terms.
How does the property inspection process work?
Before finalizing a purchase, it's recommended to conduct a thorough property inspection to identify any structural or maintenance issues.
Buyers can hire a professional surveyor to assess the property's condition and provide a detailed report.
This step is crucial to avoid unexpected repair costs after the purchase is completed.
What is the significance of the preliminary contract (compromesso)?
The preliminary contract, or "compromesso," is a legally binding agreement that outlines the terms and conditions of the sale before the final deed is signed.
It typically requires the buyer to pay a deposit, usually 10% to 20% of the purchase price, to secure the property.
This contract protects both parties by clearly defining the obligations and timelines involved in the transaction.
What taxes are applicable when buying an apartment in Milan?
When purchasing a property in Milan, buyers must pay a registration tax, which is 2% for primary residences and 9% for secondary homes.
There is also a cadastral tax and a mortgage tax, each typically amounting to €50.
These taxes are usually paid at the time of the final deed signing.
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How can I ensure the property has no legal issues or debts?
Before purchasing, it's essential to conduct a title search to verify the property's legal status and ensure there are no outstanding debts or liens.
This can be done through a notary or a legal advisor who will check the property registry for any encumbrances.
Ensuring a clear title is crucial to avoid future legal complications or financial liabilities.
What are the common pitfalls to avoid when buying an apartment in Milan?
One common pitfall is not thoroughly understanding the terms of the preliminary contract, which can lead to unexpected financial obligations.
Another is underestimating the additional costs, such as taxes and fees, which can significantly increase the total purchase cost.
It's also important to verify the property's condition and legal status to avoid costly repairs or legal issues post-purchase.
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What should I know about the neighborhood before buying?
Researching the neighborhood is crucial, as factors like public transportation, amenities, and future development plans can affect property value.
It's advisable to visit the area at different times of the day to assess noise levels, traffic, and overall ambiance.
Understanding the neighborhood's characteristics can help ensure it aligns with your lifestyle and investment goals.