What to do to safely buy and sell. Due Diligence on Properties: Expert Tips
a) Titles
Ascertaining titles that is checking on the property owners ‘history.
This entails obtaining true copies of deeds, successions, donations, and/or any transaction or arrangement involving real estate over the preceding 20 years.
Relevant copies can be obtained from agencies in every major administrative town in Italy (Umbria has two: Perugia and Terni) or by applying to the Conservatoria dei Registri Immobiliari (Land Registers) and paying all necessary duties.
Any application for documents dated from the 1980s and later can be completed online, thanks to computerised recording of notarised deeds which was introduced in those years. For any older deed, you must make an appointment with the office in charge of the area where the property is located. For example, for any real estate located in Citta’ di Castello administrative area, the office in charge is in Perugia – thus you should contact Conservatoria dei Registri Immobiliari di Perugia to make an appointment. Here are two links for more details on Registri Immobiliari and their relevance to this section.
b) Burdens
Excluding burdens entails conducting specific searches online or at relevant agencies in the jurisdiction where the property is located. It is crucial that what is briefly referred to in Italian as ispezione ipotecaria, or mortgage and lien searches, be processed online and in the relevant area of the Italian Revenue Agency. This area is still only in Italian and not immediately accessible; access codes are necessary to process any such search, hence the relevance of getting qualified advice through experts that carry out all relevant checks at least BEFORE any preliminary contract of sale-purchase is signed. The notary too will carry out the above searches so as to make sure that in the time elapsed from when the contract was signed to when titles are transferred at the notary’s, no burden or lien is encumbering the property. These checks (which extend to company’s owners when properties are not privately owned! Hence involve other agencies too) should be carried out by vendors and their consultants BEFORE any property is put up for sale, when not! they ought to be made a condition precedent to ANY handing in of confirmatory deposits to vendors; so any effect of the preliminary contract should be suspended while searches are conducted for mortgages and liens—not just those, but at least those. Professionals in real estate negotiations and transactions, that is, brokers under Italian law, showing their licence to prove their role, are expected to carry out the above checks as part of their due diligence, and costs remain covered by fees unless otherwise specified. Any of the above searches start from Agenzia delle Entrate and the online search generally starts here:
Identifying easements, or potential third-party rights that could restrict how a property is used. The most common easements are the right of passage across properties (also used for pipelines by national agencies), the right of view, the right to use water from a well on the property (which is rather common in the countryside), farmers’ pre-emptive rights on land, and so on. Not all easements are apparent or easily identified, yet they are relevant to any property evaluation and must be investigated.
Ascertaining National Heritage burdens because properties may be listed, and this specific set of burdens needs to be checked specifically when dealing with historic edifices in towns but also traditional ones in the countryside, and with the specific sections of Ministero della Cultura through Sovrintendenza dei Beni Culturali e Ambientali (our National Heritage Department), which has an agency in every region, and here’s the main link to start checking formally when in doubt: https://www.soprintendenzapdve.beniculturali.it/attivita-istituzionali/tutela/
c) Compliance with Building Regulations
The real estate planning status is to be verified! This phase frequently requires contacting relevant municipal authorities at the Ufficio Urbanistica (town planning department), which exist in every Comune (municipal administrative unit) and Regione (region), to search for documents indicating that initial or additional works on edifices have been authorised. In Italy, these procedures are referred to as ‘accesso agli atti’ and vary depending on the history of the building. Vendors must make every document pertinent to the notarised transaction available by the notary stage at the latest. Yet, given the significance of permits and licences in any sale and purchase, vendors, who remain legally accountable for any declaration they make when sitting before a notary, are strongly encouraged and, as for me, also helped to carry out the aforementioned search and to do so before officially putting properties up for sale.
Many vendors still believe that since they bought their property with no in-depth searches on the property, this is how they will sell it, possibly trusting the over abused phrase ‘as seen and liked by the buyers’ in contracts! But this has NO legal relevance. Buyers would confirm the above, but this does not do away with the vendors responsibility for the regular status of what they sell. That regular status had better be ascertained before they make false declarations when at the notary’s, with all the negative consequences that would come with it. Brokers are the professionals you go to in Italy for relevant advice at this level too. Actually, few are trained to carry out the above searches, but all know of its relevance, and skipping this part is a recipe for problems!
Nowadays any search is made easier by modern technologies, and given the increasing relevance, notaries too are giving surveys emerging from the above investigations (be aware that notaries DO NOT carry out any search at this level!). nor have to; they lack the technical training to check on this specific part). It is vital for buyers to get the FULL set of relevant permits, licences and proceedings on any work carried out on a property and prior to any written undertaking or at least make these checks a condition precedent to any preliminary contract of sale-purchase. More often than not, vendors are in good faith, but the technicians they hired may not have been so. Only by checking on the property’s compliance with building norms will the truth emerge. For decades the planning side of works has been neglected in Italy! or handled superficially, especially around the 50s and 60s and through the 90s and early 2000s! Any professional in real estate knows this and must make sure that any agreement drawn up for the parties, even for just one party, covers vital information that ensues from relevant searches on the planning status of any property too. The complex set of regulations this country has on licences and building norms began to take form in 1939, FYI!
The importance of this set of searches for vendors and buyers is evident and helps ascertain the real estate cadastral plans too. Great confusion re what actually makes a property sellable vs what proves its being compliant with our complex set of building norms and regulations sometimes reigns among professionals too, but the ones worth hiring know how to make complex things simple and, more importantly, would do what makes any sale and purchase safe for the parties.
d) Energy Performance certificate and EPC index
EPC is essential for any sale or purchase at both notary and marketing levels, effective from 1st July 2010. Furthermore, from 1st January 2012, all advertisements must also display the EPC index. You should expect to see these details displayed in any real estate agency’s presentation. Although compliance is still quite rare, there are very few exceptions to this requirement regarding advertisements and indeed sales, for vendors and brokers.
Getting the above basics right from the very early stages of selling and buying is the best piece of advice that an expert can give you. An expert by your side will make the difference in any move you make in selling and buying real estate easy, safe, and enjoyable. These checks are basic but not yet standard at the level suggested here; hence, the relevance of getting qualified advice that makes sure that this recommended level is reached. A stitch in time saves nine!
