Estate Agents
In the UK they rank as public enemy number 2 (pushed off the top slot by bankers in the last couple of years, but ready and able to regain the prime position as soon as the market picks up). In Italy it’s a bit different.
There are 3 sorts of estate agent in Sicily.
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. In Sicily it doesn’t. 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. Sicilians 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. 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.
The other large professional association – FIMAA – is also technically only for legal, licenced estate agents, but in Sicily they have given membership to the bloke who owns the tobacconist and sells houses on the side – so unfortunately FIMAA no longer has the kudos it once had.
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 is the biggest in Italy, but I have to say that the Sicilian branches are pretty poor. 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. The other big franchises are Professionecasa, Gabetti, and Tree – and big doesn’t mean best.
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.
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.
Some ‘agents’ have the back up of another legal estate agent – technically its not allowed – even the man who shows you the house should be a registered estate agent. In these cases its fair to assume that the legal agent is party to whatever games the illegal agent is playing, and you should denounce them. 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 its Sicily doesn’t mean you will ‘end up with the fishes’ – the vast majority of Sicilians abhor dishonesty and lament how these agents give the region a bad name.
Basically the rule of thumb is that if your agent doesn’t want to be named in the act of sale he’s illegal – 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. If he’s a member of FIAIP he’s legal, but make sure his dues are paid for the current year.
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 Sicily. Most of these are honest people who do a good job, but there are always a few who give the rest a bad name.
A British company who has a website with property in Italy is probably not an Italian estate agent, and the majority work openly and honestly with registered Italian agents. They act as a buyers’ agent – and end up with the buyers commission, or part of it, while the Italian agent takes the sellers’ commission. There are two ways to do this – you pay the buyers’ commission to the English agent and declare nothing at act, or you pay the whole lot to the agent on the ground in Sicily and the English agent invoices him for his share after the event. If there is no Italian agent, however, they are wholly illegal.
The English sites have their place, but remember that the majority are listings for other agents – as are Italian estate agents who are based on the mainland. They earn the buyers commission for sending an email, and you will probably pay more than the local level of commission – so its not the most cost effective way to shop for a house, and an Sicilian estate agent will always prefer a direct contact to a referral.
Agents who are based in Sicily, 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 while some of them are very reliable, 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, so one Sicilian property ‘portal’ which in the Italian version lists houses, but in the English version claims commission on any sale, is acting completely illegally.
Some agencies 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.
Maltese estate agents are the latest addition to the Sicilian scene. Malta is only 40 miles from the south coast of Sicily, and many Maltese buy in the provinces of Ragusa and Siracusa as land is very inexpensive compared to Malta.
Malta recently entered the euro zone and some agents claim that they are allowed to sell in Italy because it’s a single market. European law states that this is indeed the case, BUT is subject to the law in the state where the activity takes place, not where the company is based. Maltese estate agents are run on the same model as British ones – anyone can open up shop. It doesn’t mean that a Maltese estate agent can sell property in Sicily – they should still have a patentino and be registered. The consequences can be unpleasant.
A Maltese agent I know, while undoubtedly good at selling flats in Sliema, knows nothing about Italian law or property and is adamant he is allowed to sell property in Sicily. However, if the mandate is signed in Sicily, or the compromesso is signed on Italian soil the transaction is deemed to be an Italian one and so falls under Italian law. If he really had nothing to fear he would be happy to be cited in the act, but for some reason he wants the commission paid in Malta and no notifiable presence in Italy, so its fair to assume he knows he’s being naughty – and all at the expense of his clients.
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 – and you should say how much the agent has been paid, along with his number of inscription and partita IVA/VAT number – 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. 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.
The European Directive on the free market for professional services is meant to come into force in 2010. Belatedly the professional associations FIAIP, FIMAA and ANAMA have discovered that this directive will mean that anyone can sell property in Italy. While giving a helping hand to the single market, it will also spawn a crisis in the housing market, as people who have no idea about Italian law or planning decide that they can sell a house or two to some unwitting tourist. Hopefully, the Italian government will opt out of this clause, otherwise there will be many people who buy properties through inept ‘agents’ and who end up with nothing.
Commission:
The rate of commission in Italy is technically ‘advised’ by the Chamber of Commerce in the province where the estate agent has his legal seat. It’s been 2% for as long as I can remember, much more common now is a rate of 3% and the Chamber of Commerce is silently in agreement. If an agent starts asking for 4% or often more – refuse, call the guardia, walk out of the office, issue a denuncia. He’s just trying it on. One agent near me asks for 6% from the buyer on the basis that he will obtain your codice fiscale – it must be the best paid 10 mins work of the year for him. The best thing to do is ask the agent how much commission he charges before you go and see any properties with them. Better still, the rate should be clearly written on the website.
The easiest way to find an estate agent is using one of the big sites such as www.immobiliare.it – checking out the individual agents web site and then doing a further check – a FIAIP agent will be listed on the FIAIP site – www.fiaip.it or alternatively go to the Chamber of Commerce site – www.registroimprese.it and check if the agent is registered with the CCIAA (Camera di Commercio di Industria, Agricoltura e Artigiani)– you can search by category – either agente immobiliare or agenzia immobiliare or directly by name. An agente immobiliare is a sole trader so you might have to look him up by name, whereas an agenzia is a company and will be found by the company name. If they’re not on this site, they are not legal.
Being on a site such as casa.it or immobiliare.it should technically be open only to legally operating agents, but it’s never so simple. Always check the credentials of the agency before you shortlist them – it’s the quickest and simplest way to save yourselves a lot of money and heartache.
If you end up buying using an illegal agent – the most important thing to remember is to refuse point blank to pay his commission at any point before the act of sale. The Italian civil code and custom in Sicily have the commission payable at compromesso (the preliminary of sale) – because according to the Civil Code – ‘the affair has been concluded at this point’ In the olden days of yore perhaps it was the case that the handshake and deposit concluded the affair, nowadays its not quite so black and white. Pay commission at the final act, or afterwards – the illegal agent hasn’t got a leg to stand on as 1) they are not entitled to any commission 2) the payment will be in ‘nero’ and undoubtedly cash only and 3) you’re paying.
Also, don’t do anything else illegal such underdeclaring – should the Guardia di Finanza descend on the illegal agent, you as a client will also be hounded down and have to pay fines for making false declarations in a public act – at 10.000 euros a time they can soon add up.
Commission paid (legally) to an estate agent is tax deductible if you submit an IRPEF (income tax) return. You can claim up to 1000 euros on the commission incurred on buying a prima casa.