Only 30% of foreclosed properties are sold by auction

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The foreclosure time has decreased in 2018, but most end without foreclosure properties being put up for auction to be bought by new owners. Buying a property at auction is an excellent way to buy cheap houses for sale, but many of the foreclosed properties do not reach this stage.

According to the latest data, Italian law has reduced the time to repossess a property by court order. While in 2017 this period was 5 years, in 2018 the average decreased to 4.21 years.
In addition, 60,238 procedures were registered in 2017 and 49,622 in 2018, a decrease of 10,616 (-17.62%). The productivity of the courts continues to increase, and the number of cases resolved is 26% higher than that of those registered (compared to 11% last year).

There are still a large number of pending proceedings, some 240,000 of which are more than 10 years old, in some regions, especially in the southern, with major delays, which are difficult to resolve in the short term.

Pending this year’s report, idealistic / news got an idea of ​​the effectiveness of foreclosures in terms of the actual allocation of buildings, the focus of these execution procedures. On average, according to data from the 2017 report (also available for those who are not members of the T6 Association website), 49% of the registered files (282,206 out of a total of 585,829) reached the final phase, varying depending on of court.

It is necessary to distinguish between the different categories of closed files, if they have been closed because the property has been auctioned or for other reasons. The 2017 study showed that, at the national level, files in the first category (closed because the property was sold at auction) accounted for 29.8% of the total number of completed procedures, while those in the second category had represented approximately 69.6%.

Taxes, fees, and expenses when buying a property at auction

If you decide to buy a property at auction, you have to pay certain taxes and commissions. Let’s see what these are.

As for the taxes to be paid on the purchase of a property at auction, they are the same as those levied on a traditional sale-purchase transaction. That is, you pay a different amount depending on: if the property is your home or is a second home and if the seller is an individual or a real estate developer (in this case you will pay VAT if the sale takes place within five years of completion ).

Expenses for the purchase of a home at auction

Buying a home by auction also involves expenses, some mandatory, others only possible:

  • First of all, you need an advance of between 10 and 20% of the bid, which will be returned to you if you do not win the property in the end or will be deducted from the total if you win the auction.
  • Auxiliary expenses related to taxes and delegated to the sale or to the person appointed by the court for all bureaucratic activities related to the auction.
  • Condominium expenses: If the previous owner did not pay the association expenses, you will be asked to pay them instead for the current year and the previous year.

To these mandatory expenses should be added those for urban and cadastral amnesty (in case of surface discrepancies or construction abuses) and any costs for the release of the property, which can be borne by the court of the buyer.

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