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Wondering how much your house will cost you to run? And worried about how will you manage it?
There is a number of fees and costs to consider when buying a new house, including the cost of moving home when it is a relocation, and the thinking of the ‘afterwards’ could be daunting, in particular if you do not speak Italian. This guide will help you plan for what happens ’after’: after you have signed your final deed, after you have moved into your new home in Italy, after you enjoyed your little piece of Italy!
House Insurance in Italy
Buildings insurance covers the cost of rebuilding your home if it is damaged or destroyed. It also covers the cost of repairing damage to the structure of your property, and garages, outbuildings, fences are also covered, as well as the cost of replacing items such as pipes, cables and drains. The insurance should cover the full cost of rebuilding your house, also including the costs of demolition, site clearance, and architects' fees.
It is also a good idea to have contents insurance for all your possessions, and this will cover the replacement of items that get destroyed or stolen. In Italy this is not different, and it is advisable to be covered, in particular if your property is left vacant for several weeks or months at the time.
The cost in Italy for building and contents insurance is very affordable. The policy cost will vary on the amount to ensure but here some quotes to give you an idea:
2-bedroom Apartment on Lake Como: €200 euro per year
Country house with swimming pool in Umbria €240
4-bedroom Luxury villa in Tuscany €600
1-bedroom apartment in Milan €90
Luxury Villa with swimming pool in Sicily €700
2-bedroom apartment in Lucca €400
Although this cost is not high, if your property is part of a condominium you might be tempted to skip it. This would not be advisable as the condominium insurance, payable as part of your condo fees, only covers the communal areas so if there are any damages in your apartment, you would not be covered.
In Italy Building and Contents Home insurance also includes Third Party Liability Cover. What does it mean? If a neighbour, or anyone else for a matter of fact, comes to your house, trips over and gets hurt, you will be covered for any possible claims. Italian Home insurance can also have other extras, for instance covers for damages from theft, attempted theft and vandalism. Just ask when you apply for insurance. Policies generally are provided in Italian only but there are some Under Writers (although few) that also have their policies in English. In Italy Home Insurance are not mandatory and therefore you do not need to have one in place by closing date but it is certainly advisable not to wait for too long.
TARI - Collection/Garbage tax
Within 60 days from closing on your new home in Italy, you will need to submit a TARI declaration and register you as the new owner of the property. The local authority will then send you an annual bill – payable in instalments.
The cost for this annual tax depends on the size of your property and the number of people that are part of your household. The TARI tax is not very high and for instance you should budget around €100-€150 per year for 1-bedroom apartment up to €1000 for a Country Estate in Tuscany including a main house and several guest houses. For those who registered their properties as holiday homes, local authorities usually send their bills via email and payments can be made by bank transfer from any International bank.
Annual Property Taxes /Local authority taxes
IMU and TASI are annual property taxes for Italian real estate, that apply to residential homes, annexes, garages, properties in need of restoration and some type of land (depending on their registration). The amount to pay (payable either in one go or by 2 instalments, due in June and December) is based on where the property is and its valuation registered at the Land & Dwelling Registry Office – this is not the commercial value but it is called ‘Rendita Catastale’, simply its Cadastral value. Each year the local Comuni issue their rates based on which the taxes are calculated. Who needs to pay it:
- Those who bought their home as a holiday house
- Those who have bought their home as a resident but live in Italy for less than 6 months
Some local authorities will send their bills and a form to pay the tax via an Italian bank, but most of them do not send out bills for IMU and they expect home owners to self-calculate them. This is quite a convoluted system but there are several accountants and real estate managing companies that offer this service and the Annual Taxes are again not very high, comparing to annual property taxes in other countries such as the US. No wonder why many Americans want to live in the Bel Paese! Expect from few hundred Euros per year for apartments/town house to €4k-5k per year for very very large estates!
Running Costs - Utilities
It might worth asking the sellers how much they spend on utilities – gas, electricity and water – every year. But don’t forget that these should be kept as guidelines only as these all depends on the size of the household too. A family of 4-5 people certainly spends more than a couple living in a same size apartment, and a family of adults will also have different use than a family with kids and teenagers!
Generally, the switch from the sellers to you as the new owner can be made online or by phone, but in certain cases you may need to be physically present in Italy and therefore this is a task that we advise to be assisted by your agent. Important is to have a copy of the bills from the previous owners and therefore, do not forget to leave the notary’s office with copy of them (and ideally the latest meter readings) together with the keys of your new home in Italy!
Electricity
Electricity in Italy is not a cheap business… whether your property is vacant or occupied 365 days a year, you will need to consider monthly fees in addition to your actual consumption. This translates to circa €40 per month for properties with standard 3- 4kW power and €70 for those with 5-6kW. Electricity bills can be received by post or email and paid by direct debit directly via your Italian bank or by bank transfers – but be aware that transferring from abroad might incur banking fees for the receiving bank and the electricity company might account less money than what you have sent!
Gas
Gas can be via mains or via gas tanks if you are in the countryside and not connected to the main system. The bills can be received via email as well as by post and it will depend on the company providing your gas but again, direct debit can be arranged so you will not have the headache to pay individual bills and if you are not in the country, bills will not remain unpaid.
Water
Water bills in some countries have a fix cost, independently from the actual consumption. In Italy this is not the case and water consumption is measured by water meters. The registration of the water contract under your name is often done at the local authority as in many areas of Italy the water service is run by the Comune rather than by private companies. Similarly to the other utilities, you can arrange payment by bank transfer from abroad if you do not have an Italian bank account.
Internet WiFi
If you do require a reliable and fast internet connection when you are in Italy you will need to install a telephone line as both fast broadband and fibre WiFi internet connections in Italy require a landline. In terms of costs you can expect around €30-€35 per month with unlimited data, although internet providers can offer deals for the first year connection.
Too much to remember? Too much to manage? Remember we are here to make your life easier!
All our clients can ask to be followed with our after-sale services. Our office will set up all automated payments for you, send you reminders of all the deadlines to meet, to help you manage your home smoothly even from abroad!
If you'd like to know more about our services, send us an email, we'll be happy to explain in more detail!
