Everything you need to know about renting a property in Italy.
For many expats, looking for the perfect housing solution may be frustrating and disappointing unless they understand the laws and regulations. Here are some things to keep in mind when looking for a rental.
In Italy, there are three types of leases:
- A 4 year lease + 4 year extension at the same conditions;
- An 18 month (max) lease;
- A 3 year lease + 2 year extension at the same conditions.
Most landlords today opt for the 3+2 lease as it has reduced taxes on the rental income.
Residential rentals
Residential rentals in Italy are regulated by law no. 431/98, and this must be written on the lease. The tenant (conduttore) has the right to break the lease by giving notice. Italian law stipulates a maximum of six months’ notice, but this should be negotiated.
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Currently it is common to agree on a three-month break clause. Diplomats can also ask for a diplomatic clause to be included in the lease specifying that they can request a reduced notice period, which is regulated by the specific embassy or organisation and also depends on the position held by the staff. It is usually two months but could also be as little as one month. The landlord is not obliged to accept, but most do.
Breaking lease
The landlord may not break the lease before the renewal period. And the landlord may only be allowed to renew the extension for specific reasons.
Therefore the tenant has little risk of being asked to leave, unless he or she is breaking the conditions described in the lease itself.
The tenant will be asked if the lease will be under the tenant’s name or a company name. This is because the landlord (locatore) will have to pay more taxes on the revenue if the lease is in a company name.
The difference between individual and company on a 3+2 lease is often 30 per cent, making it difficult to find landlords willing to rent to a company.
Cedolare secca or flat tax
If both parties are individuals the landlord can opt to apply the cedolare secca. This is a flat tax on the revenue generated from the rent and is applicable on all types of leases. Under the cedolare secca option, the lease is not subject to registration fees or government, and the monthly rent must stay the same for the duration of the lease.
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If, instead, one of the parties is a company and the landlord cannot opt for the cedolare secca, or if the landlord decides not to opt for it for fiscal reasons, there is a yearly registration fee to be paid.
This is two per cent of the annual rent, to be divided equally between the landlord and the tenant. There are also government stamps that must be applied only on the initial registration, which the tenant must pay for entirely. It is usually one €16 stamp for every lease registered.
The landlord has the right to increase the rent each year according to the cost of living index (ISTAT). It is usually not more than two per cent maximum. In this case, if the tenant breaks the lease early, he or she will have to sustain a fee of €67 to the registrar’s office. The landlord will take care of paying it, but will then seek reimbursment from the tenant.
Security deposit
It is customary for the tenant to leave a two-month security deposit with the landlord on the signing of the lease, which will be returned at the end provided no damage has been done to the property and all bills have been paid.
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If the property is completely furnished, the landlord may ask for a three-month deposit. The lease expressly states that the tenant is not to use the security deposit against the last few months of rent. Such an arrangement can be made if no damage is present and all bills and rent have been paid, but only if the landlord agrees.
Otherwise, a check is done at the end of the lease to see if there has been any damage. The law does not specify how quickly the landlord has to return the deposit, but if there is no damage it usually happens within a day or so. When damage is involved, the landlord has to get a quote for the repair and then shares it with the tenant. This is usually done within a week.
Maintenance
In Italy the tenant is responsible for ordinary maintenance and for the items/appliances in the property. This means that if, for instance, the tenant has plumbing issues because they have not been cleaning the filters in the taps (Rome’s water is high in calcium deposits), he or she will be responsible for the cost of the repair.
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The tenant is also responsible for ordinary maintenance checks to the gas boilers every year. The landlord is responsible for any extraordinary maintenance. For instance, if the boiler breaks, the landlord has to replace it at his cost. Sometimes there is a fine line to understanding whose responsibility it is to fix household appliances.
In the USA and Canada, as well as in some other countries, the landlord pays for any and all repairs. This is not the case in Italy.
If renting a semi-furnished flat, the tenant may be expected to buy electrical fixtures too. Most landlords who are used to dealing with expats will put electrical fixtures in each room, but be aware that this may not be the case for every property.
Condominium
The tenant has to pay the condominium fee or homeowners fee. This is called le spese di condominio.
The landlord should be able to provide the tenant with the previous year’s balance in order to verify the amount to be paid. The fee goes toward paying the condominium administrator, the cleaning and lighting of the common areas, the ordinary maintenance of the lift, the gardening fees and the porter's salary. If there is no porter and no lift in the building, the amount should be minimal.
The utility contracts should be put in the tenant’s name. The gas and electricity meter readings are taken at the beginning and end of occupancy. Some utility companies require the lease to be registered before they will put the contract into a tenant’s name. The tenant can choose which internet/telephone company to use. Fiber-optic connections are available in major Italian towns but not everywhere.
Repainting
Before signing the lease the tenant should ask if the flat has been freshly painted and if the landlord expects it to be repainted before it is vacated. Not all landlords request this but they may.
If the tenant asks the landlord to repaint the flat, the latter will definitely request a clause to be put in the lease stating that it has to be returned repainted at the tenant’s cost otherwise he will deduct the cost of repainting the property from the security deposit.
Personal documents required
When a flat is chosen, it is customary for the tenant to be asked to send an email with a copy of their indentification and either a copy of their work contract or the last two pay slips. This is simply to verify that the tenant is able to afford the rent.
Italians usually have to leave a caparra, which is a a deposit to hold the property during the negotiations period. If the agent or landlord is used to dealing with expats, they may not require a deposit but they will request the documentation.
Once the offer is accepted, the tenant will be expected to send a bank transfer or leave a cheque from an Italian bank coveing one month’s rent while the lease is being drafted. Before doing this it is always a good idea to ask for a copy of the visura catastale, which is a document showing ownership.
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This way you are assured that you are sending the money to the owner of the property. Any responsible agency will make sure the tenant has this document before asking for the deposit. The deposit to hold the property will be used against the security deposit. At the signing of the lease the tenant will be expected to pay the rest of the security deposit and the first month’s rent. This is also when the tenant will be expected to pay the realtor their commission.
Check-in list
At the handover, it is common to fill out a check-in list called a verbale di consegna and it is wise to take photos of the property to document its condition. The meter readings will be taken at this time too.
It is recommended to choose a real estate agency that is used to dealing with expats because the entire process will be much easier, run more smoothly and be hassle free.
By Bonnie Rose-Zanni
Zanni Real Estate
This article was published in the May 2018 edition of Wanted in Rome magazine.