Types of rental contracts
When you are renting a property in Italy, you will most likely sign a rental contract. It is important to understand what you are agreeing for. There are two types of the rental contracts in Italy: a free market contract and a convention contract. The first one is conducted for four years and is renewable for an additional four-year period, in which tenant and landlord agree the conditions between themselves. A convention contract is a three-year contract with a two-year renewal option, although the initial period can be increased to five years with no renewal option.
Registration of the contract
These new contracts are replacing the old rent control and long term contracts. Luxury apartments, public housing and tourist apartments are exempt from free market contracts. A contract should be registered with the local registration office to be valid. Registration fees include 2 per cent of annual rent plus government stamps. Furnished properties registrations are around 3 per cent of annual rent. These fees are normally divided between the landlord and the tenant.
Conditions for reclaiming property
If a landlord needs to reclaim a property before the expiration of the free market contract he can do so by giving the tenant six months’ notice in writing, but only under certain conditions. The conditions include requiring the property for his own use, for a child who’s getting married or for an elderly parent or in-law or to make improvements or repairs prior to selling it. If within a year the property is not used for the purpose stated in notification, the landlord must renew the initial contract with the same tenant or pay an amount equal to three years rent as compensation.
It is possible to terminate the contract prior to the first expiration date while the landlord must give a tenant six months’ notice prior to the first expiration date. A convention contract can also include short-term leases for students and transitory workers.