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Why 2020 will be a good year to buy and renovate a home in an Italian city

If you’ve been saving up to invest in a dream home in Italy, the country’s 2020 budget law has lots of new tax breaks to help you refurbish an old property in the country’s towns and cities.

Published: 26 January 2020 11:18 CET
Why 2020 will be a good year to buy and renovate a home in an Italian city
Photo: g_u/Flickr

Italy’s government wants to encourage people to invest in old homes in the country’s urban areas in 2020, a real estate segment that’s losing value at such a rate that it’s weighing down the property market as a whole. 

“In recent years the price of these properties had grown too much. And there’s the fact that Italians do, on average, very little maintenance on their homes,“ Maurizio Sgroi, economic journalist and author of the blog The Walking Debt, told Repubblica.

Even the briefest look at houses for sale in smaller Italian towns and cities reveals that the vast majority of houses available have not been renovated for decades, boasting appliances that belong in a museum, terrible energy efficiency ratings, and often, serious structural issues.

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For this very reason, Prime Minister Giuseppe Conte’s government will either maintain or introduce generous tax breaks in 2020 in the hope that homebuyers will stop being put off by the price and hassle of a major renovation. 

Here are some of the standout features of Italy’s 2020 budget vis-a-vis home refurbishments in urban areas (zones A and B):

– A 50 to 65 percent “econonus” tax break for energy renovation of old buildings.

– A 50 percent deduction for renovations with a price ceiling of €96,000 for each property.

– A 50 percent tax deduction when buying energy-efficient home appliances, with a price limit of €10,000.

– A 36 percent “garden bonus” or “green bonus” on personal income tax (Irpef) for anyone spending more than €5,000 on the construction of green roofs, irrigation systems and other sustainable add-ons. 

– A 50 to 90 percent tax deduction on restoring old buildings’ façades including balconies, windows, eaves, gutters and thermal coating insulation.

For these deductions to apply, the renovation work must be invoiced and paid for electronically.

The tax deductions are available to anyone who is resident in and pays tax in Italy. For more details, contact your Italian financial advisor or a qualified surveyor or geometra.

Read more: The best renovation properties you can buy in Italy for less than €50K

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PROPERTY

Can you still buy Italy’s one-euro homes in 2024?

A lot has changed since Italy's 'one-euro' home offers first made international headlines, so are they still available - or worth considering?

Published: 14 May 2024 10:27 CEST
Can you still buy Italy’s one-euro homes in 2024?

The prospect of buying a house in Italy for less than the price of a caffè normale at the local bar caused a sensation back in 2019, when news of one-euro home schemes hit the international headlines.

There was a property stampede in Sicilian towns in particular, with local mayors reporting being overwhelmed with enquiries in English and other languages.

MAP: Where in Italy can you buy homes for one euro?

Even sceptics couldn’t contain their curiosity: Was it a joke? What condition were these houses in? And how much was this really going to cost?

Several years later, we know that these schemes are legitimate attempts to breathe new life into depopulated areas and unburden local authorities of old, unwanted properties that would otherwise be left to fall apart. And in some cases, at least, it has worked – and proved very lucrative for the towns involved.

We know most of these houses are in a very poor state of repair, requiring major investments from their new owners. And we know the costs can be high, with reports of some international buyers spending hundreds of thousands of euros on renovations – many times more than the property’s potential market value.

READ ALSO: Six things to know about Italy’s one-euro homes

But we’ve also heard from some readers who tell us that, while these homes do of course cost more than one euro, for a sensible buyer they can be a worthwhile investment.

Not only are Italy’s one-euro home offers still going strong in 2024, but new towns are joining the scheme, while others continue to announce similar ‘cheap home’ projects such as the rental programme in Ollolai, Sardinia aimed at remote workers – one scheme that’s expected to take off following the introduction of Italy’s new digital nomad visa in 2024.

So what do you need to know if you’re curious about these Italian property bargains?

As ever, if you’re interested in buying a one-euro home you’ll need to meet certain requirements which vary depending on the local authority. After all, this is not a nationwide scheme but a series of small initiatives run by local councils in each town or village, so you’ll need to carefully check the terms and conditions of every offer you consider.

Generally though, the following will apply:

  • Foreign nationals can buy one-euro houses, whether they’re EU or non-EU citizens – but remember owning one will not give you any residency rights in Italy, and visa rules will still apply to non-EU nationals.
  • The prospective buyer can’t just make vague promises about doing the place up: you’ll need to present a renovation plan within 2, 3 or 6 months depending on the village.
  • Buying a one-euro home to turn into a tourist rental business is generally allowed, but you’ll need to let the local authority know your plans when you apply.
  • The cost of the house, all renovation costs, and all notary, legal, transfer and other fees are the responsibility of the buyer.

Some things have however changed in the past few years which make buying and renovating a one-euro home less affordable than it once was.

Many buyers in recent years were further tempted by generous state subsidies available to cover the cost of renovation work – most famously the ‘superbonus 110’ which covered up to 110 per cent of qualifying expenditures.

READ ALSO: What taxes do you need to pay if you own a second home in Italy?

Though the superbonus is now winding down and is no longer open to new applications, it has had a knock-on effect which means renovations in Italy generally take longer and cost more than they used to.

The superbonus scheme’s enormous popularity led to an ongoing shortage of building contractors in Italy, who were booked up months, or even years, in advance.

And as the popularity of these offers has exploded, the most viable properties in some areas now often become the subject of a bidding war, with the sale price rising from one euro to tens of thousands.

Find a map of the towns currently offering one-euro homes in Italy here.

Have you bought a property through a one-euro home scheme in Italy? We’d love to hear from you. Please get in touch by email or in the comments section below to let us know about your experience.

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