In order to realise your dreams of buying property in Italy, you will need to consider the financial aspects of your move in detail.

The minute you decide that buying in Italy is a possibility you’d like to turn into a reality, you need to assess your finances, and how much you can afford to spend on a property.

In order to prepare for your purchase, you should establish from the outset how you will pay for your property.

It’s possible to fund a purchase in a number of ways, for example, from your savings, or through a mortgage. You will need to research each option to determine which works best for you.

In addition to the cost of your Italian property, and the costs associated with the purchase (i.e. legal fees, buying costs), you may also need to factor in a renovation budget, as well as how much you will have to pay each month to maintain the property.

Italy - Buying - Finances

You will need to ensure your tax affairs are in order, to avoid paying taxes in both countries

Hidden costs

When determining your budget, rather than just noting down the actual purchase price, you need to delve deeper to avoid being caught out by additional costs that will arise during the buying journey. These “hidden costs” are detailed in our Italy Buying Guide, helping our readers to get more of a grasp on the amounts they will have to shell out for costs like estate agent’s commission, legal fees, taxes, and the cost of transferring funds to Italy. As these costs can really add up, it’s important to budget for them from the start.

The Italy Buying Guide looks into this in detail, and guides you through everything you need to consider. Download your free guide today.

Financing your property

In order to prepare for your purchase, you should establish from the outset how you will pay for your property. If you plan on purchasing with a mortgage, you will need to assess the different mortgage options available, whether you want to take out the mortgage in the UK or in Italy, and what restrictions and conditions on a mortgage you are likely to encounter.

To determine the best options for your personal circumstances, we recommend speaking to a professional advisor. Speak to our trusted mortgage provider about your options today.

We cannot stress enough how important careful consideration to currency exchange is to the success of your purchase in Italy.

Tax planning

If you plan on moving to Italy on a permanent basis, to avoid paying taxes in both countries, you will need to establish your tax liabilities in the UK taking into account your new residential status. As your circumstances will be changing, you may be subjected to taxes on selling your UK home, on purchasing your Italian property, and inheritance tax.

As every individual’s circumstances are different, we again recommend speaking to an expert who will be able to help you get your head around all the jargon, and ensure your tax affairs are in order.

Overseas money transfers

Setting an accurate budget to buy a home in Britain is relatively straightforward: you take your income, savings and any proceeds from the sale of your existing property and calculate what you can afford. This figure remains static throughout the buying process, allowing you to work within your means. Budgeting to buy a property in Spain requires the application of the same principles, but with the added risk of being exposed to exchange rates and the political and economic variables that influence them. As exchange rates rise and fall the price of your overseas property is likely to fluctuate between making the deposit payment and paying the outstanding balance. Just when you think your pound is looking good against the euro, it might fall in value, potentially making your dream property unaffordable.

Italy - Before purchase - Opening a bank

Manage risk with a Currency Exchange Specialist

Don’t just sit back and leave your money at the mercy of an interest rate decision back in Britain, GDP data from the Eurozone or the latest employment figures from Italy. You have the power to control your destiny. That is why we recommend speaking to our trusted partners, Smart Currency Exchange. They offer solutions that help you avoid the risks associated with rates dropping, thereby protecting your budget and keeping your plans on track. For example, they can lock in an exchange rate to protect the price of your property from adverse rate fluctuations, so you know how much it will cost when the time comes to part with your money. Contact Smart today to find out how they can help you.

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Save money when buying overseas

Whether you are buying a property abroad, making regular payments, sending money overseas or back in to the UK, you want the most cost-effective, safe and easy way to transfer your money.

That’s where Smart Currency Exchange can help. As one of the UK’s fastest-growing currency exchange specialists, we save our clients thousands of pounds every day by minimising the risk associated with transferring money overseas.

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