Buy your own apartment on Lake Garda

The own vacation apartment on Lake Garda – The dream of many Lake Garda vacationers

Buy your own apartment on Lake Garda – This is the dream of many Lake Garda vacationers. When we were on vacation at Lake Garda in 2014, we saw the signs of a local real estate agent. Over our obligatory ice cream at Qciari, we thought out loud, “Oh, to own such a small apartment or cottage on Lake Garda, that would be something.” We had no idea at that time and what a real estate on Lake Garda costs.

Spontaneous as we are, we called the realtor and made an appointment for a viewing in Tremosine. We all didn’t like the first apartments so much, mostly they were out of our budget or needed a lot of work.

Spontaneous as we are, we called the realtor and made an appointment for a viewing in Tremosine. We all didn’t like the first apartments so much, mostly they were out of our budget or needed a lot of work.

We were about to give up on our plan when the realtor told us about a supposed “distress sale”. I didn’t like the apartment at all, but Käthe was totally enthusiastic, especially about the gigantic view of the Lago. My better half has a very good sense for such things, so I relied on it and we decided on this apartment – One of the best decisions of our lives so far.

What is the best location for your own apartment on Lake Garda?

It’s a matter of taste: north, south, east or west: every region on Lake Garda has its charms.

Since we have preferred the western shore of Lake Garda for years, we enjoy the morning sun. Our domicile is not directly on the lake, but a little above in Tremosine. The drive to the lake takes 15 minutes, but you are away from the big hustle and bustle. Especially in August it is very pleasant to have some peace and quiet. Moreover, the restaurant La Fenice and a bakery with a food market are easily accessible for us.

How expensive is it to buy your own apartment on Lake Garda?

We were incredibly lucky…You can already speak of a bargain purchase. Our apartment is not big (about 50 square meters), but it has 2 rooms, a terrace and its own part of the garden. And of course lake view. The closer you get directly to the lake, the more expensive the real estate becomes. Of course, the lake view also determines the value of a vacation apartment on Lake Garda. Depending on location, equipment and size, you can buy apartments on Lake Garda from about 100,000 euros. Renovations are often necessary, you should plan for that. Finding craftsmen on Lake Garda was and still is a challenge for us, especially because of the language barriers….

Buy your own apartment on Lake Garda – Financing:

For EU citizens the purchase of an apartment in Italy is possible without any problems. Since we didn’t have the money for the apartment, we had to finance a large part of it. For this purpose, we concluded a loan agreement with our house bank, but only a property in Germany or other assets such as an endowment life insurance policy counted as collateral.

What to consider when buying a vacation apartment on Lake Garda?

We bought our own apartment on Lake Garda through a real estate agent. Normally, in most cases, this invites one to make a limited, irrevocable offer to purchase. This is a unilateral legal transaction, as the purchase offer is only binding for the buyer. Upon acceptance of the offer by the seller commits to purchase.

For us, the advantage of dealing with the real estate agent was that we were taken care of during all processes. Since we agreed relatively quickly with the seller, a preliminary contract was initially concluded. This is legally binding and includes all terms and conditions of purchase (including furniture sold with the property).

The preliminary contract also usually stipulates the payment of a deposit. Any contractual penalties for non-performance are also specified here. There are 2 variants of the deposit, the deposit with purchase obligation and the deposit with fine. In our case, the first variant came into play.

The down payment with purchase obligation due with the preliminary contract is between 10% and 30% of the actual purchase price. The down payment is deposited by the broker as security. Once the preliminary contract has been signed, you have a set period of time (approx. 14 days) to put the property through its paces.

The down payment with fines provides only a small down payment (usually about 2% to 4%) and is used mainly when it is uncertain whether the purchase or sale of the property can actually take place. At the time of the conclusion of the preliminary contract, there may still be doubts as to whether the buyer or the seller can actually carry out the transaction. For such cases, a right of withdrawal should be included in the preliminary contract. The withdrawal from the purchase or sale is associated with high costs.

You can also register the preliminary contract with the property register via the notary. This is particularly useful if there is a long period of time between the preliminary and main contract or if there are doubts about the economic situation of the seller. Registration also prevents the apartment or property from being sold to third parties until the final purchase contract is signed. You should also note that there are additional costs to be expected when registering the preliminary contract in the property register. We did without it and had no problems with it.

Important: The seller must give you copies of all essential documents concerning the object of purchase even before signing the preliminary contract. In addition, the seller is obliged to provide you with any information that could influence your decision to buy.

What should be checked in particular when the preliminary contract has been concluded?

If the apartment is in a condominio (community), the property manager should be contacted. Usually the broker knows the property manager, otherwise just ask a resident.

The property management should be asked which investments in the common property are planned or have been made in the past. In addition, the manager knows if there are any debts owed to the community by the previous owner.

ATTENTION: If you buy an apartment on Lake Garda and there are debts to the community of owners, these are transferred to the buyer.

Another important check is the inspection of the real estate register or the register at the cadastral office. Many properties on Lake Garda were built in the 70s and 80s. At that time, there was a somewhat looser approach to registration in the cadastral register, mainly to obtain building permits. So it can happen that an apartment on Lake Garda is listed as a garage in the cadastre. If this is the case, it is necessary to hire a surveyor who will arrange for the correct registration at the cadastral office. In the case of detached real estate, the entry in the real estate register and the cadastre should also be checked.

What happens if the buyer or the seller withdraws from the purchase contract before the deadline?

Until the expiry of the deadline set by you as the buyer, you are strictly bound by the offer. In the event of death, the purchase offer made would even pass to your heirs! If you want to withdraw from your purchase offer, you risk losing the deposit you made. In addition, in most cases you even have to pay the agreed brokerage commission.
The seller can decide within the set period whether to accept or reject the offer. If he agrees to the offer, the seller must also observe all relevant points for the subsequent purchase contract at this stage and accept the purchase offer in writing.

The final purchase contract for your dream home on Lake Garda

Once you have put everything through its paces, you can finally go to the notary to sign the final purchase contract. The “transfer of ownership” takes place directly after the conclusion of the notarized purchase contract, there is no entry in the land register. For the notary appointment you need an Italian tax number
(see checklist) and the following documents:

• copies of identity documents of all persons mentioned in the contract
• Notarized power of attorney for representation by authorized representatives
• Proof of marital status for private individuals
• Certified extract from the commercial register for companies
• Shareholders’ resolution on the purchase/sale of real estate in Italian companies
• Current cadastral extract
• Official floor plan and site plan
• Contract of sale or certificate of inheritance of the previous owner
• Proof of any mortgages and their extinguishability upon payment of the purchase price
• Confirmation that there are no property-related and personal tax arrears of the seller
• For houses: Building permit; certificate of habitability; possible subsequent approval of a black building, including proof of payment of the penalty; energy performance certificate.
• In the case of land: Rental or lease agreements, insofar as the land is rented or leased out.
  For building plots: Proof of suitability for building
• In the case of agricultural land: Non-exercise confirmation of those entitled to pre-emption (tenants and/or direct neighbors).

In addition, the contracting parties are obliged to name the sales price and participating brokers. The notary also checks whether all the conditions included in the preliminary contract have been fulfilled. In principle, the final purchase contract is a confirmation of the preliminary contract. Once the purchase agreement has been concluded, the notary public arranges for the new owners to be entered in the Italian property register.

Payment:
The purchase price is paid directly after signing the contract at the notary. In this case, the payment flow must be stated under oath in the purchase contract. Cash payments are not allowed, the purchase price can be paid either by bank transfer or by circular checks. Furthermore, the notary fees are due directly after the conclusion of the contract. The cost of the land transfer tax – which the notary pays to the land registry on your behalf – is also payable directly to the notary.

Since 2006, the tax rate for real estate transactions in Italy is calculated on the cadastral value and not on the actual purchase price. So there is no reason not to state the full sale price in the purchase agreement if you do not want to pay taxes. If you don’t include the full price in the purchase agreement, you may lose money if you want to sell the property later. In case of false declarations and verification by the Italian state, in the worst case high fines are to be expected.
Within 30 days, the notarized purchase agreement must be registered with the Real Estate Registry. Without this registration, the purchase contract is not effective against third parties. The registration of the purchase contract is done by the notary.

What are the additional costs when buying an apartment or a house on Lake Garda?

Brokerage fees:
If you buy a property through a real estate agent, they will charge you a fee for their services. This is usually between 3 and 4% of the purchase price. Please note that the Italian Value Added Tax (IVA) will be added to the fees. It makes sense to set the commission at the beginning of the cooperation with the broker.

Notary fees:
Of course, the notary also charges appropriate fees for his services. These are quite variable and of course also dependent on the amount of work. In any case, you should expect costs of 3,000-4,000 euros here.

Taxes:
As in Germany, land transfer tax is due on the purchase of a property in Italy. The assessment basis is the sales price stated in the purchase contract. Furthermore, VAT is due, this depends on the use and whether the purchase is made from “private” or through a construction company.
There may be further costs, depending on whether you have consulted a lawyer, expert or similar.
A detailed overview of the costs incurred can be found, for example, at Garda-Living.

What are the running costs after buying a property on Lake Garda?

After the purchase of your own property, there are of course ongoing costs. Even if you bought the house or apartment in good condition, you should budget for maintenance costs every year. If you have bought an apartment in a condominium, there are annual costs for the property management and the maintenance of the common property. Maintenance measures are usually decided annually at an owners’ meeting.

Other costs that should be considered are:

• Garbage fees: These are set annually by the municipality. We pay here about 100,- Euro per year
• Taxes: Every owner is obliged to pay an annual property tax. This is usually paid in two installments, once in mid-June, once in December. The amount of taxes is determined by the respective municipality. We pay about 100,- Euro / year.
• Electricity costs: In addition to the actual electricity consumption, a basic fee is also charged by the energy supplier. Our energy supplier is A2A Energia.
• Internet: If you use an Internet provider, you will also incur corresponding costs here
• Income tax, tourist tax, etc.: If you rent out your apartment professionally, you must declare this to the municipality. Some municipalities charge a tourist tax, and you will also have to pay income tax.

Step by step to your own apartment on Lake Garda – Checklist

1. Use the appropriate real estate portals to find the properties you are interested in, contact the agent and arrange viewing appointments.
2. If you have found a suitable object, you submit a limited, irrevocable purchase offer
3. If all parties agree, you conclude the preliminary contract with the seller (legally binding!)
4. Then you check the property register and the entry in the cadastre.
5. Before signing the final purchase contract, you must apply for an Italian tax number: this can be obtained outside Italy from the Italian Embassy or Consulate: https://conscolonia.esteri.it/consolato_colonia/de/il_consolato/la-rete-consolare
6. Conclude the final purchase contract at the notary – registration of the new owners in the Italian real estate register
7. Payment: This takes place directly after the signing of the contract by bank transfer or check.
8. Entry in the property register by the notary. This is the last step before you fulfill your dream of buying your own apartment on Lake Garda!