How much to save to buy a home in Italy in 2026: complete guide for expats

One of the biggest surprises for people buying property in Italy — especially expats — is how much capital needs to be mobilised beyond the down payment. Italy's transaction costs vary significantly depending on whether you are buying a prima casa (primary residence) or a seconda casa (second home), and the differences are substantial.

Total capital required to buy in Italy

As a practical planning target, you should have access to approximately:

• 25–30% of the purchase price for a prima casa (primary residence)
• 30–40% of the purchase price for a seconda casa (second home or investment)

This accounts for the 20% down payment plus transaction costs plus a reserves buffer.

The 20% down payment

Italian banks typically finance a maximum of 80% LTV (Loan-to-Value) for primary residences and 70–75% LTV for second homes. The remainder must come from your own funds.

Key nuance: Italian banks calculate their 80% on the lower of the purchase price or the bank's own appraisal value (perizia). If the appraisal is lower than the agreed price (common in competitive markets), you must cover the gap from your own savings.

Example: you agree to pay €200,000. The bank appraises the property at €185,000. The bank offers 80% of €185,000 = €148,000. You must provide: €200,000 − €148,000 = €52,000 (26% of the actual purchase price).

Transaction costs for primary residences (prima casa)

Italy's prima casa regime applies significant tax reductions to buyers establishing the property as their primary residence.

The key benefit: registration tax is 2% of the cadastral value (not the market price), and the cadastral value is typically 20–50% below market value in many Italian cities. This means the effective rate on the actual purchase price is often much lower than 2%.

Transaction costs for second homes (seconda casa)

If you are not establishing Italian residency or already own a prima casa in the same municipality:

This substantially increases the capital required. A seconda casa purchase at €200,000 requires approximately €40,000–60,000 in transaction costs and down payment combined.

New build properties (nuova costruzione)

For new builds, registration tax is replaced by VAT:

• Prima casa: 4% IVA on the sale price
• Seconda casa: 10% IVA on the sale price
• Luxury properties (cadastral category A/1, A/8, A/9): 22% IVA

Plus notary fees, cadastral and mortgage fixed taxes apply.

Recurring ownership costs: budget for these from day one

IMU (Imposta Municipale Propria): Italy's annual property tax.

• Primary residences: exempt (significant advantage)
• Second homes: 0.46–1.14% of the cadastral value, depending on the municipality and any local additional rate (aliquota)
• Typical annual IMU for a second home: €500–3,000

TARI (Tassa sui Rifiuti): Waste collection tax. Annual charge typically €150–500 depending on municipality and property size.

Condominium fees (spese condominiali): For apartments. Monthly charge covering building maintenance, lift, common areas. Typically €80–250/month. Request the piano di riparto (cost allocation plan) from any seller.

Home insurance (assicurazione sulla casa): Required if you have a mortgage. Typically €300–600/year.

The codice fiscale: get this first

Before you can do anything in Italy's property market — open an Italian bank account, sign any contract, apply for a mortgage — you need a codice fiscale (Italian tax identification code). This is a non-negotiable first step for all foreigners.

Obtaining a codice fiscale:

• Can be done at the Italian consulate in your home country
• Available at the Agenzia delle Entrate (Italian Revenue Agency) offices in Italy
• Typically free and issued on the same day or within a few days
• Does not require Italian residency

Summary savings targets by purchase price and type

Based on 20% down payment + appropriate transaction costs + 3% reserves