Italian property news roundup: 'Superbonus' delays and tax rule changes

Superbonus bureaucracy causes delays

Italy’s ‘superbonus 110‘ is one of many government measures brought in to mitigate the economic impact of the pandemic, offering tax deductions of up to 110% on certain expenses involved in renovating a property.

While you’re very unlikely to be able to claim the full 110%, there are still significant amounts of money to be saved - and unsurprisingly, interest in the scheme has been massive.

So massive in fact that its popularity, and the complexity of the paperwork involved, has seen building companies dealing with a flood of enquiries and a backlog of work. Many are now booked up well into next year, while also facing labour and material shortages.

With no chance of starting a new project anytime soon, some people have simply given up on their renovation plans.

And others midway through projects are now concerned they may not finish in time, and are tensely awaiting confirmation that the claim period will be extended beyond the current deadline of June 30th, 2022 (for single-family homes).

Read more about the current situation here - and please do contact us and let us know if you’re affected.

Will a change to Italy's tax rules affect property prices?

You may have seen reports in the Italian media this week about an ongoing government row over changes to the rules on property taxes, with claims from certain politicians that homeowners will be out of pocket. So what exactly is going on?

The government is planning reforms to the property tax and land registry system which it says will increase transparency and help stop tax evasion - a major issue in Italy, where property tax evasion is thought to cost the state some six billion euros every year.

It’s a huge bureaucratic project, aiming to overhaul the system in order to make it easier for authorities to spot the estimated one million unregistered ‘ghost’ properties and other illegal builds in Italy.

The reform includes changes to the way property values are calculated on the catasto (the cadastral record: the property records submitted to the town hall) which, as anyone who has ever looked at one may have noticed, often show values way below market rates.

These rates are used to calculate local taxes (such as IMU), house purchase taxes and other fees -  and the reform means they would in future be changed to reflect actual purchase prices.

The reform comes after the European Commission warned in 2019 that Italy's "land and property values... which serve as the basis for calculating property tax, are largely outdated".

The details are yet to be worked out and finalised, but the political argument is based on concerns that this change would push property prices and/or taxes up in future.

But the reform would change nothing before 2026 and even after that, Prime Minister Mario Draghi insisted this week that: “Nobody will pay more and nobody less” due to the reforms.

“Everything will remain as before and the average taxpayer will not notice anything,” he told reporters.

Another part of the reform plan, that would come into effect earlier, in 2022, is to ease the income tax burden on medium earners and potentially also slash tax costs for first-time home buyers.

We’ll bring you further updates on any changes to the tax system once details are confirmed.

Thinking of installing solar panels?

With all the doom and gloom recently about soaring energy prices in Italy and beyond, the idea of switching to solar power may be increasingly appealing to homeowners - especially in a country with no shortage of sunlight.

READ ALSO: Rising energy prices: How to save money on your bills in Italy

More and more Italian households and businesses have been turning to solar energy in recent years - in fact the number of photovoltaic systems in Italy has increased by more than tenfold over the last decade, and the country now ranks top worldwide for electricity consumption covered by solar panels according to new research 

Systems are becoming more affordable and accessible, too - you can now even buy them at Ikea.

With a multitude of options on the market and many combinations of products suitable for a 3 kW photovoltaic system (the standard household power supply in Italy) it can be hard to know where to start, or whether it’s worth the investment.

Find a breakdown of the options, costs and potential savings involved here.

In case you missed it:

Until and unless Italy does slash some of those property taxes mentioned above, purchasing a home here remains an expensive - and extremely bureaucratic - process.

But if you're going to buy, there may not be a better time than right now.

From falling house prices to record low interest rates, I wrote an overview of why there are some major financial advantages to buying at the moment. (And I'm not just saying it - these are the conditions that persuaded me to buy a property myself this summer.)

If you have any tips, stories or thoughts on what we should include in the next edition of the property roundup, we'd love to hear from you. Email us here.

See more in The Local’s Italian property section.