There are 3 sorts of estate agent in Italy.
- Legal and good.
- Legal and bad
- Illegal
Let’s start with the legal ones. In all of Italy, you can’t be an estate agent unless you’ve passed exams and got your licence. This is designed to protect the public and in some areas it works. The theory is sound. An estate agent is independent and works for both parties to finalise the transaction. As such he will take commission from both parties. Italians love the ‘trattativa’ – the arguing over nuances and the endless argy bargy over price.
You can only be really sure that your agent is legal if he or she is a member of FIAIP, (Federazione Italiana Agenti Immobiliare Professionali), the professional body. The agent must be nominated and seconded by other FIAIP members to get in, and once in you pay a fortune for the privilege. However, in recent years the nomination and seconding of potential members has been ditched, and now anyone can join – which means that a lot of rather dubious agents are now in the ranks, as is the case with FIMAA, the other professional association.
Fiaip agents have a code of conduct, and more importantly, insurance in case they make a mess of it all and leave a client baying for blood.
ANAMA is the Associazione Nazionale Agenti e Mediatori d’Affari and like FIMAA is an arm of a National business council – the Conferescenti, or in FIMAA’s case the Confcommercio – and both represent not only estate agents, but also financial agents and mediators of all types.
As far as real estate agencies themselves go, the big franchises are growing in power and presence. Tecnocasa was the biggest in Italy, but I have to say that the branches I have visited have been pretty poor. The latest all consuming franchise is ReMax, which operates on a strange system of one agent and dozens of ‘consulente’ who are only paid commission on sales. Just buying the name isn’t enough to guarantee a good level of service, and the franchising system in Italy means that it’s a cunning way round the law, as you can have a franchise without necessarily being a licenced agent. Even the odd foreign franchise has landed, such as Engels and Wolkers who promise much, charge 4% commission and have yet to make real inroads into the market but insist on exclusive contracts to the detriment of all and sundry. It all comes down to the individual agency that you use.
Don’t think that bigger and posher is best – there are some international agencies that work in Italy that employ some of the most ill-prepared and ignorant agents I have ever encountered. What these agents like to do is meet people and try to walk through fields in vertiginous heels. What they can’t be bothered with is checking any documentation or knowing the law.
Even some legal estate agents are not the upstanding citizens they should be. It is illegal for an estate agent to profit from the deal other than from his commission, but this doesn’t stop some selling their own property, signing compromessos and flipping a property, or taking back handers from the seller to get a higher price from the buyers. It is rife. If you’re asked to sign a compromesso with a different person from the owner of the property, there is usually something going on. Be on your guard and make sure you know all the possible consequences of your actions.
Unfortunately it’s not easy to know whether your estate agent is good at his job until it’s too late, but by the time you’ve seen a few properties you should have a clear idea if he knows what he is talking about.
Illegal agents fall into two camps: the ones who pretend to be legal agents and have offices and web sites, and the bloke you meet on a street corner who happens to know someone who has a house to sell. Neither of these has the right to ask for commission, and it is illegal to give it to them without it being declared in the act of sale.
There are some particularly glossy websites about offering houses and legal advice. All omit the words ‘agenzia immobiliare’ and usually promise a team of professionals who offer legal assistance. Basically, this means that the agency is a lawyer’s office, out to make a bit more money. It doesn’t make sense buying a house from the same lawyer who will prepare your contract – it’s just asking for trouble. It’s also illegal for a lawyer to act as an estate agent. They can lose their licence to practice the law – there is obviously a vast conflict of interests at work. Any lawyer who sells houses should be reported – he won’t ask for commission – they get around this particular problem by including their commission in their legal fees – but it’s a slippery slope to take, and again, you end up with no protection if things go awry.
Some ‘agents’ have the back up of another legal estate agent – technically it’s not allowed – even the person who shows you the house should be a registered estate agent. The Civil code states that an agent must be independent, impartial and not tied by obligation, collaboration or representation to either the buyer or the seller. If the agent himself or his partner is making money by selling you a property (other than their legitimate commission) they can lose their licence and pay hefty fines – so don’t be afraid to trot off the to the carabinieri or the Guardia di Finanza if you smell a rat. Just because it’s Italy doesn’t mean you will ‘end up with the fishes’ – the vast majority of Italians abhor dishonesty and lament how these agents give the region a bad name.
The rule of thumb is that if your agent doesn’t want to be named in the act of sale he’s acting illegally – it means that you, he and possibly the notaio are breaking the law and can all be fined. Worst of all as the buyer you have absolutely no comeback if things aren’t what they seem.
Obviously, if the first you know about it is at the point of act, something has gone awry, so on first meeting an agent ask to see his or her credentials – a legal agent will have no problem!
Any agent must put his licence number on the front page of his website along with his VAT /IVA number. Again this isn’t as easy as it should be. A tobacconist will have a licence number with the local Chamber of Commerce – the Camera di Commercio – but it doesn’t mean that he can also sell houses.
With the general economic malaise, many legit agents have suspended their VAT number but continue to run their office and work under the radar. It means that they will want to be paid in cash, and again this is not in your interest.
There is now a law on illegal agents which increases the fines for all parties who use an illegal agent and pay in cash. Not only – it will also impose jail sentences (thereby becoming a criminal act and not a civil crime), and can involve the sequestration of goods (ie the house bought through the illegal agent). Needless to add – do not use illegal agents, do not pay in ‘nero’ and make sure that your agent is cited in the act of purchase when it is stipulated at the notaio. Paying an agent in ‘nero’ is only costing you money and legal protection. To re-emphasise the point: Your agent, whoever it is, MUST be cited in the act of the sale. If not you are breaking the law, you could get a 10.000 euro fine and have your act annulled.
FOREIGN AGENTS
You’ll see a large number of British, American, and assorted sites that are based in a different country and offer property for sale in Italy. Sorting out the wheat from the chaff is a virtually impossible task.
A British company which has a website with property in Italy is unlikely to be an Italian estate agent. These listing sites which offer the Dolce Vita will want paying in the country where they are based, and will not want to appear in the act of sale. The agent in Italy will act, and be paid for, solely by the seller – and therefore you have absolutely no legal recourse in the event of mistakes. In such cases you should pay your commission to the agent on the ground in Italy which will be written into the act of sale, and the English listing agent can then invoice him for his share after the event.
The English sites have their place, but remember that the majority are listings for agents or for a bloke who flogs houses. They earn the buyers commission for sending an email, and you will probably pay more than the local level of commission – so it’s not the most cost effective way to shop for a house, and an Italian estate agent will always prefer a direct contact to a referral.
There’s an American lawyer who has a large internet presence and who says he is allowed to sell property in Italy as he is a lawyer. He isn’t. If you pay his astronomical consultancy fees you will end up unhappy and poorer.
Agents who are based in Italy, but use any number of other terms to describe themselves such as a portal for buyers, a buyers’ agent, consultants, property specialists, or a holiday rental company who sell houses on the side are very unlikely to be legal, and it is entirely at your risk if you give them lots of money and get nothing in return. What is important to remember is that only a legal agent has the right to ask for and get commission. You are under no legal obligation to give anyone else a cent. Some offices will market themselves as consultants – consulente – and this is just another way to get round the law. A consulente will act for both parties and call his commission a fee – it doesn’t mean you are protected in any way – and the likelihood is the consultant knows nothing about what he’s talking about other than the price of the property.
‘Agents’ that only seem to be present on Facebook and so on are unlikely to be legal and, frankly, are best avoided.
The law requires that any agent involved in the sale of a property is named in the final act of sale. This is mainly for the law on recycling of money – all so the Guardia di Finanza can keep tabs on them. If you don’t name and shame the agent – usually because he doesn’t want to be put in the act it has potential consequences. Firstly you will have technically committed perjury, ie – made a false declaration in a public act – and that carries a fine for you of up to 10.000 euros, and since last year a possible prison sentence. Secondly, you sign away any right of recourse in the unhappy event that something is wrong. If there is no agent in the act, the law says there was never an agent involved in the sale, so you have no-one to sue. Not naming the agent saves him a lot of money – his entire commission becomes tax free, but it only saves you the VAT on his fee. It is not a gamble worth taking.