965 Estate Agent fees

Italian estate agent fees are higher than those of the UK - typically somewhere in the region of 2 to 4% of the price paid for the property (rather than its declared value).
In addition, it is common for the responsibility for payment of the estate agent fees to be split between the purchaser and vendor 50/50, so that can be a surprise hidden cost for the unwary.

I think it can be be more than 4% - split between the purchaser and the vendor. It can be between 4% - 8%, depending on what they (the agent) do for you - like get it all sorted!!!

Naive purchaser ( although he did do a great deal).

ps. I suppose the message is get it all in writing and signed. Italians like this, very much, very renaissance.

The provisions made in article 1755 Codice Civile and article 6 legge 39 dated 03/02/1989 regulate the subject of commissions payable to agents/brokers.

Normally commissions are between 2% and 3%. In some places like Tuscany for example, they can be higher (5%). However, the law sets out that terms for mediation may be implied, with the exception of any specific conditions that may apply, by custom of a locality. This means that you could be asked for more but my advice is not to pay more than the 3%.

Usuallly, In Italy, an estate agent would get 3% from the seller and 3% from the buyer.

Paola

[QUOTE=latoca]Usuallly, In Italy, an estate agent would get 3% from the seller and 3% from the buyer.

Paola[/QUOTE]

Now I know why so many estate agents are starting up here ! Where I come from, the agent only gets between 1.5 and 2 % from the Vendor. The purchaser doesnt have to pay anything. LaToCa - you're in the wrong place - you should be practising here in Piemonte !
Ciao Karen

That's sort of what I am doing!

Paola

We work in collaboration with nearly 70 estate agents throughout the whole of Umbria and have never found one that charges less than 3% commission. This fee is levied on both the buyer [U]and [/U] the seller. A few charge more and I believe that IPN charge 6%! There is a reason why charges are higher than in the UK. The bureaucracy in Italy is legendary and agents do a lot of work between making an offer and the final contract. In addition, foreign buyers are unlikely to speak Italian well (it's a whole new vocabulary when buying a house even if you are nearly fluent), need an Italian fiscal code ([I]codice fiscale[/I]) and a bank account, which is all additional work for the agent.

Generally speaking you can expect to pay between 2 and 5% depending where in Italy you are.

However, when you decide on a property you want to buy, you can try negotiating with the agent as to the fee payable to the agent. I have done this for many of my clients :)
Linda Stubbs
[url]www.intouchitalia.co.uk[/url]

In response to Graham, if people get the chance whilst they are in Italy they can, of course, get their own codice fiscale and open a bank account. Both very straight forward tasks in our experience and I'm not sure whether it's worth doing it through an agent. Obviously if you are paying an agent anyway then I suppose you may as well get them to do it for you - although it's no bad thing to get to know the bank manager yourself (and them to know you). As has been mentioned before on this forum you can also get your codice fiscale from the Italian Consulate in the UK - which is in fact what we did and it took us 10 minutes.

Well daid Brendan, but how else can an agent justify charging the sort of charges they bandy around, the system in England isn't exactly simple, yet charges a quarter, or less than here, they get paid to both sell the house, and, allow you to buy it, confuses the heck out of me, yet I meekly paid the charges too, to an English based agency who squirmed when I tried to get the "professional service" promised at this end (18 months to register for ICI tax) Ohh, and we were left to sort out the bank acc. and Codice ourselves...
I know all agents are not rip off merchants, the problem is that by the time you realise yours is, you're probably locked into the sale.

[QUOTE=GeorgeS]I know all agents are not rip off merchants, the problem is that by the time you realise yours is, you're probably locked into the sale.[/QUOTE]

Yep, and just wish there was a way of ensuring it doesn't happen to others. :(

I'll bet the bad ones would sue you the instant you mentioned their name...

how would they sue if you are not making any derogatory or slandering comments??

Freedom of expression is one of the best things of living in a democratic country, so I believe that, if anyone has had any experiences of bad estate agents/solicitors/geometras/notaries and the lot, they should be named and shamed so that others will not fall in the same trap?

Or are we only allowed to discuss about "good" service received?!

I can see Graham’s point about the level of bureaucracy. We all know how cumbersome, slow and unpredictable the system can be. There’s also the question of time wasters. I’ve lost count of the number of people who have asked to view properties only not to turn up without so much as a simple phone call to say that they have changed their plans.

But this is part of the job and something the agent has to accept and I don’t see the justification for charging commissions of higher than 3%. As previously stated, between 2% and 3% seems to be the norm and although terms for mediation may be implied according to local custom, try not to exceed 3% (and don’t part with any money if you are dealing with abusivi).

Returning to Graham’s point, helping a client obtain a codice fiscale or to set up a bank account is something I feel should be included in the service at no extra cost. With regards to doing “a lot of work between making an offer and the final contract” this doesn’t excuse the poor standard of contractual documents or the lack of proper guidance, advice and communication that is so often the case; a fair number of proposte d’acquisto, contratti preliminari and other important contractual documents are drawn up by people with very little understanding of the main legal provisions pertaining to Italian property law and that is why you get problems.

Every industry has its cowboys, real estate included. This is an unfortunate fact. Some buyers feel under a lot of pressure not just from the agent but also because of fulfilling the dream of owning a place in the sun. Of course the unscrupulous will take advantage of that too, so it is in the buyer’s best interest to be careful.

Some friends once told me that certain buyers want 100% guarantees and do not feel comfortable with any of the "unspoken" rules of buying a house. Some on the other hand, are ready to take the "plunge" without even thinking about it. Although this is digressing a bit from the core theme, here are some additional points:

It is easy to get carried away by the dream so give yourself a cooling off period.

Don’t be pressured into signing contracts or into paying cash deposits immediately.

If you are paying a large deposit it is wise to have the vendor provide you with bank guarantees. This should give you extra peace of mind in the event the deal is off. If the vendor pulls out or refuses to perform the contract without lawful reason, yes you are entitled to get your money back but remember this can result in a long and drawn out process. Bank guarantees are a way to avoid this problem.

Get to know what the best way to structure your overseas purchase with regards to taxation and inheritance issues. In short, seek out proper, professional advice.

Never sign a preliminary contract or a proposta d’acquisto if you don’t understand it.

Seek an explanation of the provisions made by the Civil Code that regulate contractual conditions. Agents and vendors love quoting them in their drafts but how many bother to explain what they really mean or what their implications are?

Don’t pay commissions straight away. If you are using a solicitor, then have a condition drawn up whereby the agent will be paid upon successful completion. A reputable agent would not object to this.

Try to get any pre-contract searches and enquiries done early on in the process.

Get an independent, English-speaking solicitor who is well versed in Italian property law (especially important if you are trying arrange everything from the UK). Don’t allow agents or anyone else for that matter to dissuade you from using your own solicitor. This is a good acid test because the less scrupulous agent would object to you appointing an independent solicitor or advisor.

If you need conditional clauses, then make sure they are defined precisely because if they are vague they can be declared void for uncertainty. For example, if your condition relates to your obtaining a mortgage then specify the amount required, the details of the proposed lender and any timescales required for obtaining the mortgage offer.

Obtain an independent valuation, which should highlight potential problems and defects. Again, if you were making your contract conditional, then I would specify the type of survey, the name of the Geometra or Architect and the possible defects that would entitle you to withdraw.

Get yourself a codice fiscale (via your nearest Italian consulate) and open up a local bank account.

Allow for higher transaction costs.

Never assume anything. Check things out and don’t be afraid to ask questions, especially about rights of pre-emption.

[QUOTE=Laura72]how would they sue if you are not making any derogatory or slandering comments??

Freedom of expression is one of the best things of living in a democratic country, so I believe that, if anyone has had any experiences of bad estate agents/solicitors/geometras/notaries and the lot, they should be named and shamed so that others will not fall in the same trap?

Or are we only allowed to discuss about "good" service received?![/QUOTE]

Totally agree but how could you say they were "bad" without the risk of it being libelous? Not that they would stand a chance in court, have enough evidence to write a book. Anyway couldn't face going through a court case as well.

Best thing is to spread the word about getting professional help from the start and don't believe a word an agent says until it has become a fact. That way good agents won't have a problem because they are upfront in the first place.