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Taranto becomes the first city in Italy to sell off houses for one euro

The bargain homes offer is no longer just for remote Italian villages. Taranto has become the first city to offer houses for sale for one euro, as part of a bid to improve the city's image.

Published: 28 January 2020 14:19 CET
Taranto becomes the first city in Italy to sell off houses for one euro
The Castello Aragonese, a symbol of the city of Taranto in southern Italy. Photo: Wikimedia Commons/Livioandronico2013

We’ve all heard about remote, under-inhabited Italian villages putting crumbling houses up for sale for the price of an espresso. 

In fact, the list of idyllic hilltop villages in rural Italy offering up bargain properties for sale for the symbolic price of one euro just keeps getting longer.

But if you’re looking for something less rural, the city of Taranto is now doing the same, as the local council plans to start selling off historic properties as part of a drive to improve the city’s image.

Officials hope the one euro homes offer will help breathe new life into the run-down historic area, which sits on a strip of land between the sea and a lagoon, or mare piccolo and mare grande.

“We’re aiming to take measures which will result in the repopulation and development of the old city,” council official Francesca Viggiano told Italian newspaper Il Corriere della Sera, saying they’d already had inquiries from New York, Milan and Rome.

READ ALSO:

The council said its goal is to bring 25 thousand inhabitants to the città vecchia, or old city, which had some 40,000 residents in the 19th century.

Taranto today is a city of around 200,000 people, but the historic centre’s population has now dwindled to less than 3,000.

The council said it plans to start by offering five properties up for sale at the symbolic price, and hopes to list more if these sell.

But not everyone thinks the offer of a home in Taranto’s old town is such an attractive one.

Il Corriere della Sera described Taranto’s città vecchia as “a set of narrow alleys with dangerous houses.”

Many people reportedly left the area due to the poor condition of the streets and buildings, particularly after 1975, when a building collapsed killing an entire family in the historic centre.

A beach in Taranto overlooked by the Ilva steelworks and Eni refinery. Photo: AFP

Today in Italy the city is synonymous with Ilva, the controversial, heavily-polluting steel plant.

There are plans to bring the Ilva steel works up to acceptable environmental standards by 2024 but it needs major investment by owners ArcelorMittal.

Despite health concerns, the plant is unlikely to be closed down as, along with the Eni refinery, it’s one of the main employers in a city with a chronic shortage of jobs

READ ALSO: The towering task of cleaning up Taranto’s toxic steel plant

But the one-euro homes offer is “the nucleus from which Taranto must be reborn,” Viggiano said, “we no longer want the city to be associated only with Ilva.”

And the Italian government has recently awarded Taranto 90 million euros for improvements to the historic centre, including to water and sewage infrastructure, as well as the reconstruction of the waterfront.

As with other one-euro house schemes, which have been a hit in smaller towns and villages across the country in recent years, the one-euro homes offer in Taranto will come with terms and conditions.

Houses sold for just €1 in Italy are often in need of serious renovation work. File photos: Municipality of Sambuca di Sicilia.

And the total costs of buying and renovating these properties will of course be far higher than one euro.

New owners will need to foot the bill for extensive restorations, which could run to hundreds of thousands of euros.

That’s without considering potential costs of taxes and fees associated with buying and owning property in Italy.

They will also be required to live in the properties, a condition designed to stop property speculators snapping them up and selling them on for a profit.

The homes in Taranto are expected be listed for sale in the coming days. 

Please note: The Local cannot help you apply to buy any of these houses. Please address all inquiries to the municipality of Taranto. But do let us know if you decide to make an offer!

 

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PROPERTY

Five expensive mistakes to avoid when buying a house in Italy

Italy may be known for property bargains, but the purchase process itself isn't cheap - and certain mistakes can make it far more costly for buyers.

Published: 27 June 2024 11:05 CEST
Five expensive mistakes to avoid when buying a house in Italy

There’s always a lot to keep in mind when buying property, but the Italian purchase process may be quite different to what you’re used to in your home country.

As well as involving high taxes and fees, it’s likely to be more complex and formal in some ways – and this can lead to potentially costly pitfalls.

The Local spoke to three Italian property law experts at legal firm Mazzeschi to find out what foreign buyers should be aware of before they sign anything. 

1) Check your estate agent’s contract

If you use a real estate agency in your Italian home search, normally you’ll need to sign a contract with them. That contract should stipulate their fees, their duties, and their tax information.

There is one other thing in the contract which potential buyers must look out for: an exclusivity clause, meaning the potential buyer may use only that estate agent in their property search for a set period of time.

“Usually in Italy estate agents like using this exclusivity clause. It is normally the same for sellers as it is for buyers. It means you cannot have another estate agent and usually contracts say this, “says Caterina De Carolis, Lawyer at Mazzeschi.

READ ALSO: How to avoid hidden traps when buying old property in Italy

“If the time frame is not yet up, and the potential buyer uses another agency, they may still be liable to pay the agency fee for the initial estate agent they entered their contract with,” she adds.

Some contracts might not have an exclusivity clause. It’s always worth double-checking.

“If you use another agency to find a house, you’ll be liable to pay the agency with the exclusivity clause in the contract around 2-5 percent of the house’s sale price,” says De Carolis.

“The exact percentage is always in the contract.”

2) Make sure to agree on a price beforehand

This rule is universal, and may sound obvious. But there are costly consequences in Italy if the price is not formally agreed and written down.

Lawyers at consultancy firm Mazzeschi urge their clients to make sure the full price of the property is declared in the transfer deed (l’atto di trasferimento).

This is because if you resell at a market price higher than your purchase price, you are subject to pay a capital gains tax called plusvalenza. Plusvalenza is the difference between purchase and sale price.

Checking the price of the property beforehand will save you in the long run. Photo by Kirill KUDRYAVTSEV / AFP.

3) Don’t change your mind – it will cost you

If the potential buyer has signed a binding proposal (proposta vincolante) – the process before a preliminary contract is drawn up – it becomes less straightforward to withdraw from the purchase.

“This is because the binding proposal in Italy is a lot more formal,” says Mario Mazzeschi, Head of and Attorney at Law of Mazzeschi Consultancy. 

The binding proposal works similarly to an offer. When the potential buyer puts forth their offer, the potential seller decides whether or not to accept. The period of time for this part depends on the proposal drawn up.

READ MORE: Five things non-residents need to know about buying property in Italy

If, before the time is up, the potential buyer decides to withdraw their offer for any reason, they will likely lose their deposit.

“This deposit is usually around 5-10 percent in most cases, so the buyer will have to pay that,” says De Carolis.

“If the buyer decides to withdraw, they are usually liable to pay the seller twice the amount of the deposit.”

If the proposal is not accepted by the potential seller, the potential buyer pays nothing.

4) Don’t pay anything before the preliminary contract is signed

With the exception of the above, buyers are advised not to pay anything until the preliminary contract is signed. The preliminary contract allows both parties to set out clear guidelines.

“The buyer should check with a lawyer before signing the preliminary contract as it will save them in the long run,” says Mazzeschi.

A notary should be present at this signing, adds Giuditta De Ricco, Lawyer at Mazzeschi Consultancy.

“Notaries are public functionaries. They are never on the side of the buyer or the seller, but for sure a notary is needed.”

“They are completely neutral and often it is wiser and safer for the potential buyer to put their deposit into the notary’s escrow account so the notary can transfer the money to the potential buyer.” 

5) Have the property checked beforehand

While the notary will normally check the paperwork before the sale goes through, you’ll need a different professional to check the property itself.

It may then be in the buyer’s best interest to hire a contractor themselves (this will normally be a qualified geometra, or surveyor) to get the structure of the building checked out and detail any faults or repair work needed.

This should be done before the negotiation stage, as unless there is something specific in the preliminary contract you may lose anything you have paid by pulling out of the purchase at this stage.

“The only way out of this after signing a contract is if you can prove the seller acted maliciously,” says Mazzeschi.

Key vocabulary

Transfer deed – l’atto di trasferimento

Binding proposal – proposta vincolante

Notary – notaio

Preliminary contract – contratto preliminare di vendita

Final contract – atto di vendita or rogito notarile

Deposit – caparra

Surveyor – geometra

Estate agent – agente immobiliare 

Please note that The Local cannot advise on individual cases. For more information about how you can buy property in Italy, contact a qualified professional. 

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