Italy: Real Estate Leasing

Last Updated: 16 August 2017
Article by Calogero Boccadutri

Thanks to the guidelines provided by the government with the Stability Law 258/2015, Real Estate leasing was also introduced in Italy, which involves the possibility of releasing possession of a house to use as a first home, after paying instalments for a determined period of time to the leasing company that acquired it on our behalf.

Now you can buy a house in instalments, release it only at the end of the payment and decide to keep it or change plan.
It is called Real Estate leasing and offers the possibility of entering into possession of a house before you acquire it.

Real Estate leasing is a financial instrument largely qualified and widespread both in the United States and in many European countries.
In Italy, it has been introduced and regulated only in the recent past, with the 2016 law of stability, but before the main banks have created products that specifically allow access to residential leasing to their clients.
It is a formula that is liked by (and rewards) young people above all else, if they have an income that does not exceed fifty-five thousand euros, a decrease of 19% of lease payments, up to a maximum of eight thousand euros annually, plus a detraction of 19% on the final payment (no more than twenty thousand euros) which leads to the release of the residence.

For people of the same age, or older than 35, it does not change income obligations, but lower than this is the amount of detractions since 19% would be calculated for a maximum amount of four thousand euros annually, while the additional deductible 19% at the moment of release will not be applied to figures that exceed ten thousand euros.

How much age counts

Wanting to bring in a practical example, the acquisition of a first house for the cost of one-hundred and fifty thousand euros, with a lease of 20 years at the rate of 2.9%, supposing monthly rates of €592 and calculating detractions at the end of twenty years, would cost a twenty-four year-old one-hundred and €70,000.
If they bought the same house through a mortgage over twenty years, paying an advance of thirty thousand euros and a monthly instalment of six hundred and sixty euros, you would find that you had paid, at the end of twenty years, €183,000.

The argument is different for over 35's since detractions would be lower because, in that case, this formula would be evaluated for its particular process, more than for a saving that cannot be quoted, compared to a mortgage.

Who can request it

A Real Estate lease is aimed exclusively at those who want to buy their first house, so to request it you will not need to already be in possession of a residence. Another discriminatory factor is income: the applicant must not exceed a total annual income of 55,000 euros.

How the Real Estate lease works

The client, once they have chosen the real estate to buy, whether it already exists of is to be built, is aimed at lease companies, which could be a credit institution, a bank or an authorised financial intermediary.
The intermediary and client stipulate a financial rental contract in which the first one commits to acquiring the real estate chosen by the second one.
The client can access residence bought by the intermediary and become the user of it. They begin to pay a monthly rent to the intermediary, as a rule however the first instalment is more substantial.
Once the fixed set of years of effectiveness of the contract have passed, the client can release ownership of the residence by paying the final planned instalment.

There still exists the possibility for clients to ask to continue with the formula of leasing or even to completely give up the acquisition.

Suspension of the contract

In the leasing contract, there is the possibility of suspending the payment of the lease for 12 months in case of loss of work. The suspension may be requested only once and for no longer than twelve months.
The same does not apply for commission or investigation expense, nor does it involve the accruing of interest on the residual debt.
To access it guarantees are not needed. It would only involve the only postponing of the end of the contract for a period of time equal to that of such a suspension.

What happens in case of defaulting

If the client can no longer manage to pay regularly and is therefore made a debtor, the lease company can evict them and sell the house straight away.
Once the residence has been sold, the lease company will have to pay the user however much the net of the unpaid rent was and of the agreed price due for the maximum payment instalment.

What happens in case of acquisition

A situation in which the client/user decides to change house or move to another region could occur. In this case, it is their duty to release the real estate in advance or cede the lease contract to another person.
The transfer of the contract is subordinated to the acceptance of the company that supplied the lease that should make sure of the financial reliability of the person that succeeds it.

Ownership and use: rights and obligations

The company that supplies the lease becomes (and remains) owner of the residence bought on behalf of the client until they release it.
In case the client were to end up the defaulting party the company would be able to evict them and sell the real estate straight away.

The client, even if they are not the de facto owner, takes on all the risks and benefits linked to the use of the good, the reason for which the lease contract sets out as a rule an agreement for a specific insurance policy.
By the same principle the client/user must respect all the residency obligations that normally are owed to the owner and will have voting rights during the condominium meetings.
All the communal, ordinary and extraordinary expenses will be at their own expense.

In order to ratify the transfer of ownership once the last rent has been paid, a sale contract will have to be stipulated.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Emails

From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.