10 Mistakes to Avoid When Renovating Property in Italy

Renovating property in Italy can be an exciting adventure, but it’s also a process strewn with legal quirks, bureaucracy, and cultural surprises. Foreign buyers often arrive armed with enthusiasm but ill-equipped for Italy’s intricate property laws and procedures.

In this guide, we’ll walk through ten common (and potentially costly) mistakes foreigners make when renovating Italian real estate, and how to avoid them. While we might be tongue-in-cheek at times, the facts are thoroughly checked. Buckle up (or perhaps allaccia le cinture), let’s go!

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1. Not Checking Building Classification (Catasto) Before Buying

One rookie mistake is rushing into a purchase without verifying the property’s cadastral category in the Catasto (Italy’s land registry). In Italy, every building (sometimes a part of a building, like an apartment) is classified in a category (like A, C, D, F, etc.) that indicates its nature and intended use. Don’t assume that charming stone “barn” is legally a house – it might be registered as a Category C/2 (“magazzino”, or a warehouse ), i.e. a storage shed, not a dwelling.

Categories in Group A are generally residential (various types of houses and apartments), Group C includes commercial spaces and outbuildings (shops, garages, storage), Group D covers special uses (industrial buildings, hotels, etc.), and Group F is for entities that aren’t fully “real estate units” – for example, a ruin or collapsed building would be Categoria F/2 – unità collabente, basically a structure unusable and without taxable value. If a building is F/2, it’s essentially a ruin that cannot be lived in until restored (more about that later).

Why does this matter? Because the cadastral category has big implications. It affects what permits you’ll need, what taxes you pay, and whether you can legally inhabit the place. As a buyer, you should obtain a visura catastale to confirm the category and make sure it matches your intended use. Italian experts stress that knowing the correct classification helps avoid “fiscal, administrative and planning” problems down the line. In plain English: if you think you bought a country cottage but on paper it’s a barn, you’ve got a problem! So, always check those A, C, D, F codes before you sign – they’re not just alphabet soup, but key to your property’s identity.

2. Underestimating Oneri (Taxes When Building) and Related Fees

Many foreign renovators get sticker shock when they realize that in Italy, getting your building permits isn’t free – you must pay oneri di urbanizzazione, a kind of development impact fee. These oneri are contributions to the municipality for the increased load on public infrastructure (think roads, sewers, streetlights) caused by your project. Italian law views it as sharing the cost with the community: as the Agenzia delle Entrate (Revenue Agency) explains, oneri di urbanizzazione serve “to compensate the community for the new urban burden your building creates”.

In addition, there’s usually a charge commensurate with the building’s value (a contributo sul costo di costruzione) – effectively the town taking a cut of the value added by your shiny renovated home. In theory this money is meant to be used by the municipality for the purposes we discussed, but in practice, this rarely happens.

Mistake number two is failing to account for these fees, which can be significant. For example, if you convert a garage or barn into a home, the law often requires you to pay the difference in oneri between the old use and the new residential use. There may also be a so-called “perequazione” or contributo straordinario if your renovation increases the property’s value due to a zoning change or special permission. This can happen if, say, you convince the town to re-zone agricultural land for your villa – you’ll owe a hefty bonus fee for that privilege.

In short, don’t assume your renovation costs end with the contractor. Plan for thousands (if not tens of thousands) of euros in permit fees, and check with a local geometra or architect what charges apply. Otherwise, those oneri can come back to bite, turning your budget upside down.

3. Ignoring the Difference Between Renovating an A-Class Property and Converting a C-Class One

This mistake is a subtle one. There are regulatory advantages to renovating a building that’s already in a residential category (Group A) as opposed to changing a non-residential structure (Group C or others) into a house. If you bought an old casa (categorized A/3 or A/4 perhaps) and you’re fixing it up, you’re generally doing a straightforward ristrutturazione edilizia. Italian law tends to encourage renovations of existing homes – often fees are lower (it could just be 200 euros or so in fees to fix an entire building), and permits can be simpler if you’re not altering the building’s use or volume.

By contrast, if you take, say, an old stable or warehouse (Category C) and want to turn it into your dream home (Category A), you’re facing a change of use (cambio di destinazione d’uso). This usually triggers the full array of permit requirements as if it were a new build – and the full array of costs. Remember those oneri di urbanizzazione? You’ll likely have to pay the difference for the more “burdensome” residential use now – essentially buying the right to turn that hayloft into a villa.

There could be additional hoops: for example, meeting modern housing standards (minimum room sizes, energy performance, parking spaces, etc.) that wouldn’t apply if you were just sprucing up an already-recognized dwelling. In short, staying within the A category (renovating an existing house) is usually simpler; upgrading a C to an A is doable but entails more bureaucracy and cost.

Don’t ignore this distinction, or you might blunder into a lengthy, expensive process thinking it’s “just a renovation” when legally it’s treated as new development. Before you buy that rustic barn, consult a technical expert about the feasibility and requirements to convert it – sometimes renovating a slightly run-down house (A) can be much easier than converting a “characterful” agricultural annex (C or D) even if they look similar on the surface.

4. Not Budgeting for the Army of Mandatory Specialists (Architect, Engineers, Geologist, etc.)

In some countries, you might hire a general contractor and call it a day. In Italy, by law, you will need an army of qualified professionals to get your renovation planned, approved, and signed off. Foreigners often underestimate these professional fees and the necessity of multiple specialists. At minimum, you’ll need an architect or engineer to design the project and submit the plans to the Comune (only licensed professionals can file the architectural/structural plans).

For any significant works, you’ll also need a structural engineer to calculate the static safety of the building and a geologist to assess the soil if you are doing structural work in the ground. Yes, a geologist – Italy takes building stability and seismic risk very seriously. In fact, a geological report is an integral, mandatory part of any building permit application for new construction or major renovations in Italy. You cannot simply skip it or have your architect “wing it” – the law requires a geologist’s study to be submitted, and multiple court rulings and guidelines have underscored that the geologist’s involvement cannot be omitted or replaced.

Then there’s the termotecnico (HVAC engineer). Planning to heat or cool your home? To get your permit and, later, the habitability certificate, you must submit an “Energy Performance Project” (a Relazione tecnica ex Legge 10) detailing insulation, HVAC, and how the building will meet energy-saving laws. This report must be prepared by a licensed professional (architect/engineer qualified in energy matters). In essence, Italy mandates that a renovation addresses modern energy standards, and a termotecnico will be needed to crunch those numbers.

Finally, consider health & safety: for construction sites involving more than one contractor, Italian law often requires a safety coordinator to produce safety plans (another consultant!). And don’t forget the site director (Direttore Lavori) – usually your architect or engineer – who must formally oversee the works and certify they are done according to plan. All these experts will issue invoices – none of them cheap.

Skipping these roles is not an option: their plans and certifications are part of the approval and final sign-off process. So, when making your budget, include a healthy line for professional fees (typically a percentage of the project cost). As the saying goes, “you have to pay to play” – in Italy, that means paying your technical team. The upside is you’ll have skilled pros ensuring the building is safe, compliant, and energy-efficient. The downside? If you didn’t expect it, the extra 10–15% of costs for engineers, surveys, and studies will be an unpleasant surprise. Avoid this mistake by inquiring early about which specialists will be needed for your particular renovation and how much their fees will amount to.

Table: Main Professionals Involved In Renovating Property in Italy and Their Fees

Think of your Italian renovation as a grand opera. You’re the impresario, but you need a whole cast – the architect is your conductor, the engineers are the orchestra, and yes, the geologist is that guy in the back making sure the stage won’t collapse. It may feel like overkill, but without them, the show can’t go on!

5. Do Not Buy a Luxury-Status Property (Categories A/8 and A/9)!

Hope we didn’t sound too dramatic. There are, certainly, exceptions to this rule. However, buying an Italian property classed as a luxury dwelling is, in principle, asking for trouble.

In Italy, not all homes are taxed equally. Certain cadastral categories are considered luxury properties by default, specifically A/8 (villas) and A/9 (castles or palaces). Unwary foreign buyers sometimes fall in love with that grand countryside villa or historic manor – only to discover a raft of tax consequences. The first sting is on purchase: “prima casa” first-home tax benefits do not apply to homes in categories A/1, A/8, or A/9, even if it’s your primary residence.

The Agenzia delle Entrate makes it crystal clear: the registration tax and VAT reductions for first home buyers are expressly denied for these luxury categories. That means higher purchase taxes (for example, a non-luxury first home pays 2% registration tax; a luxury home pays 9%, a huge difference).

Moreover, your ongoing property taxes (IMU) will be higher: Italy generally exempts primary residences from annual IMU property tax, except if the home is classified as A/1, A/8, or A/9 – those “abitazioni di lusso” must pay IMU even if it’s your domicile. You may gloat all you like when you tell your Italian friends you live in an actual villa, but the smile will die on your face when you discover you’re the only person amongst your friends who pays property tax.

As a final injury to the unfortunate owner of a luxury building, you will pay full VAT at the (currently) 22% rate, rather than 10%, on any renovation work you may decide to carry out. On a EUR 500k renovation, we’re talking about a EUR 60k difference!

So the trap is twofold: (a) buying a property that is already A/8 or A/9 without realizing the implications, or (b) being unable to sell this property later on. Understandably, locals are extremely wary of purchasing a property classed as A/8 or A/9. The arrival of an unwary foreigner will be bet by the current owner with the broadest smile. Lack of awareness of a property’s luxury status could cost you very, very dear.

How to avoid this mistake? Before purchase, check the current category – if it’s A/8 or A/9, factor in those higher taxes (and perhaps consider if you truly need a classified “villa” as opposed to a more modest A/7 “villino”). If you’re adamant you intend to purchase a property in this unfortunate cadastral category, ensure the price reflects this grave handicap.

6. Accidentally Triggering an A/8 or A/9 Reassignment at the End of Renovation

Related to the above, but deserving its own spot: you might start with a normal house and end up with a luxury-category house after renovation without intending to. This often catches people by surprise at the DOCFA stage – that’s when your architect/engineer files the post-renovation update to the cadastral registry. The Catasto examines the “updated” property characteristics and assigns a final category and assessed value.

If you’ve added upscale features or significantly increased the size/quality, the home can be bumped up to A/1 (luxury apartment), A/8 (villa) or A/9 (historic mansion) without you explicitly asking for it (in fact, who in their right mind would?). And as we saw, that spells trouble in terms of taxes and possibly resale (your buyer pool might shrink if the running costs and taxes are higher due to the classification).

A classic example is adding a swimming pool. A private pool is one of the elements that Italian standards historically consider when defining a luxury home (one rule of thumb: a single-family home with a pool of a certain size, or a tennis court, etc., is automatically “abitazione di lusso” per certain tax rules). Even aside from formal definitions, in practice the presence of a large pool and extensive landscaped park might prompt the cadastral surveyor to choose A/8 (the villa category, defined as a substantial home with a “notable garden or park”).

Another trigger can be total floor area – very large residences can be deemed luxury by size. Italian law (an old 1969 decree) listed criteria like having over 240 m² of useful floor space (excluding some areas), having finishes above a certain grade, more than certain number of bathrooms, etc., as markers of luxury. To add confusion, and frankly some degree of unfairness, Italy’s top court recently ruled that having 240 m² of floor space is enough by itself to deem the property a luxury building. Your protestations that you’re living in a very large, though humble, country home because you have six children and five dogs may fall on the taxman’s deaf ears.

As a small consolation, during the DOCFA process, your architect must describe the property’s features, and certain combinations light up as A/8/A/9 in the software. This will give you some warning that you’re about to enter the danger zone.

The mistake here is not foreseeing this reclassification. If you “go to town” with your renovation – and who wouldn’t want to, if budget allows – you might need to dial it back or at least be prepared for the outcome. One should consult the local cadastral guidelines (or a savvy professional) about what keeps a property in category A/2 or A/3 (normal dwelling) vs what would push it into A/1 or A/8.

For instance, if maintaining a modest exterior and not overly expanding might keep it a country villino (A/7) rather than a villa di lusso (A/8), that’s worth considering. Rather than shelling out tens of thousands for a manicured garden, opt for neatly arranged olive trees and lavender. Use the thin line between landscaping and agriculture to your advantage.

Italian professionals sometimes strategically under-declare certain finishings in the DOCFA within reason, but there are limits – false declarations are illegal. Ultimately, you want to plan your renovation with an awareness of the cadastral outcome. Otherwise, you may have a champagne moment finishing your dream home, only to get a letter from the Catasto saying, essentially, “Congratulazioni, it’s now a luxury villa – here’s your new tax rate.” Any architect will tell you, fighting the taxman on their assessment is a fool’s errand.

If unsure, ask for a preliminary assessment from the Catasto (some provinces offer this via your architect) or look at comparable properties in the area. Don’t let a surprise A/8 label spoil your renovation finale.

7. Letting a Renovation Permit Expire (and Facing New Rules or Zoning Changes)

Italian building permits are not open-ended – every Permesso di Costruire or major renovation permit comes with an expiration date. Typically, you must start works within one year of the permit being granted and finish within three years from the start. If you fail to meet those deadlines (and don’t obtain a formal extension in time), the permit lapses for any part of the project not completed.

Many foreigners, perhaps used to more flexible systems, underestimate how crucial these timelines are. You can’t take an Italian permit and then leisurely postpone the renovation for five years – not without consequences. If your permit expires, any unbuilt portion of the project is no longer authorized and you’ll have to apply for a new permit to complete it. That new permit application will be subject to whatever the current rules are at that future time.

And here’s the kicker: laws and zoning plans can change. Let’s say you got a permit under the 2019 regulations, but you delay and it lapses. By 2025, the city might have approved a new Piano Regolatore (town plan) or new building code provisions. If in the meantime the rules “hardened” – for instance, they reduced allowed building volumes, or your area was re-zoned to disallow certain works – you could be out of luck.

Indeed, the law states that a permit will also lapse if new urban plans come into force that conflict with your project, unless your works are already started and then completed within the three-year term. In plain terms: if the zoning changes and you haven’t begun, your old permit is toast; if you have begun, you better wrap it up in three years or the uncompleted part is at risk.

Renewals or extensions (proroga) are sometimes possible, but you must apply before the original permit expires and usually justify it with reasons beyond your control (e.g., unexpected delays, project complexity, or public authority delays). The mistake is to “set and forget” your permit. If you get busy or run out of funds, you might be inclined to pause the project. But letting the permit quietly run out can lead to a nightmare: you come back later to finish the job and discover you essentially have to start the permitting process over – and sometimes you no longer have “acquired rights” to do what was previously approved.

We’ve seen cases where people had an approval to add a floor or an annex, didn’t do it in time, and later the city’s rules had changed to forbid that addition – leaving them stranded with half-renovated structures or plans that can never be executed.

Bottom line: Always keep an eye on your permit deadlines. Mark that 1-year start date and 3-year (or whatever specified) completion date on your calendar. If you suspect you need more time, engage an architect to request an extension before it expires. And stay abreast of local planning news – if a new zoning law is in the works that might affect you, it’s all the more reason to hurry up.

Letting a permit expire is not like letting a carton of milk expire (where the worst is you throw it away) – here, you might lose significant invested effort and have to renegotiate your entire project under new rules. In the patient but ever-changing world of Italian bureaucracy, time can be as important as money.

8. Believing a “Rustico” Is Already a House (or Easily Can Be Made Into One)

Ah, the idyllic rustico! Many foreigners dream of buying a tumbledown farmhouse or country barn to convert into a charming dwelling. It’s a wonderful dream, and Italy has plenty of romantic “rustici” on the market. However, a critical mistake is assuming that a rustico (literally “rustic [building]”) is legally equivalent to a house, or that converting it is a mere formality.

In Italy, just because a building has four walls and a roof does not mean you can live in it. That structure might be classified as a rural storehouse, an animal shed, or even be an F/2 collabente (collapsing ruin) as far as the records go – none of which confer the right to inhabit it. A rustico often lacks a certificato di agibilità (habitation certificate) and may not meet the building code requirements for human occupancy (think minimum ceiling heights, window sizes for light, sanitation facilities, etc.). If you ignore this, you risk buying something you cannot legally call a home.

Converting a rustico into a legal abode usually involves a change of use (unless it already had residential status historically, e.g. an old farm dwelling in Category A/6, though, note, if the previous owner reclassified the A into an F in the hope to save a few pennies in property tax, it’s now like Cinderella’s carriage turning back into a pumpkin: once it has lost its status as a residence, you’re starting from scratch with making it a new dwelling.

This means paying tax, building according to current code, etc.). That means you’ll need to apply for permission to change its destination to residential, comply with all current building standards, and pay the associated fees (remember those oneri for change of use? They’ll apply here too).

It can be a challenging process: the local urban plan might limit residential development in that rural zone. Many agricultural areas only allow new dwellings if tied to a farming business (more on that in the next point). In some cases, the municipality might outright deny permission to convert a picturesque stone barn into a civilian home if it violates zoning. Or they might allow it but only by consuming some of your land’s development quota (often in agricultural zones you can build X cubic meters per hectare, etc.).

Even when allowed, the rustico must be brought up to code. A cautionary tale: in one case, an owner tried to legalize a tiny rustic cantina (cellar) as a dwelling unit. The health authority (ASL) intervened, noting that the surface area and window openings were insufficient to guarantee habitability, and thus the conversion permit was revoked. Essentially, they said “you can’t call this dark little storage a home; it doesn’t meet the health and hygiene regulations.” This underscores that habitation requirements in Italy are strict – you need adequate light, air, height, structural soundness, etc. Many rustici fail on multiple counts (low ceilings, small openings, dampness, etc.) and require significant redesign to qualify as living space.

So, don’t be lured by an atmospheric ruin without doing due diligence. Ask: What is its current cadastral category? Is it A (already a house), or something like C/2 or F/2? If it’s not A, what do local rules say about converting it? Sometimes regional laws (like “recupero dei rustici” policies) facilitate it, but often with conditions. Also, factor in the cost of full infrastructure – a rustico might not have proper sewage, water, or utilities.

You’ll essentially be building a house from scratch within old walls. The key is not to assume anything: treat a rustico purchase as buying a potential building site with extra steps, not a home. And get professional advice before you buy – an architect can tell you if that charming barn can ever lawfully become your casa. Otherwise, you might end up owning a very pretty stable where you can legally store hay, but not stay the night.

9. Buying Agricultural Land and Assuming You Can Build a House on It (Without Being a Farmer)

Similar to the rustico issue, another false assumption is thinking “I’ll buy a piece of gorgeous Tuscan farmland and just build my dream home there.” In Italy, agricultural land is not freely buildable for residential purposes. Each Comune’s planning regulations designate zones, and farmland is usually Zona E (agricultural zone) where building a new house is heavily restricted. Typically, only legitimate farmers – e.g. registered imprenditori agricoli or coltivatori diretti – can get permission to erect a dwelling on agricultural land, and even then only if they meet strict criteria and the house is needed for their farming activity. The logic is to prevent random urban sprawl in rural areas; Italy doesn’t want every olive grove dotted with vacation villas.

What does this mean for you? If you are not a farmer by profession (recognized by the local agricultural authority), the land is effectively non edificabile (non-buildable) for a house. You can farm it, plant a vineyard, etc., but you can’t put up a residential building just because you own it. The planning law usually requires a minimum land size and farming income to grant a permit for a farmhouse. For example, a region might say you need at least 1–2 hectares of land and status as an agricultural entrepreneur for at least 3 years to even apply.

And even farmers are limited in house size proportional to the land’s needs. A common standard is a volume like 0.03 cubic meters per square meter of land – meaning on a 10,000 m² plot (one hectare) a farmer might build up to 300 m³ (roughly a 100 m² house), but a non-farmer cannot build any new volume at all. There are often exceptions for small tool sheds, barns, or temporary structures, but not for homes.

A foreign buyer who isn’t aware of this might purchase a lovely rural plot imagining a future retirement villa, only to find they can’t get a permit to build anything residential. We’ve seen frustrated would-be builders having to either start a bona fide farm (not easy just to get a house!) or abandon their plans. The constraint even applies to existing buildings: if there’s a dilapidated rural building on the land, you might convert that (with difficulty, as per point 8), but constructing a brand new house is a different story.

Always check the land’s zoning use (destinazione urbanistica) in the certificato di destinazione urbanistica (CDU) before buying, and never rely on a seller’s vague promise that “sure, you can build here” without official verification. The Comune can provide information on what, if anything, is buildable there.

Keep in mind also that Italy distinguishes terreno edificabile (building land) from terreno agricolo. The latter is taxed very differently and valued cheaply because it’s not for development. If you buy it cheap, there is a reason! Some unlucky buyers have also been hit by an unexpected tax if they managed to get it re-zoned and built a house: the increase in land value can trigger taxes or fees (remember the contributo straordinario sharing of value increase from point 2 – that applies here too).

But the main point: to build a home in an agricultural zone, you generally must be a farmer or have an agricultural purpose. If you’re not, your “house in the Italian countryside” fantasy should focus on already-designated residential plots or existing houses. Avoid buying just land with vague building hopes – that’s a recipe for heartache and a field of grass as the only thing to show for it.

10. Failing to Keep Invoices and Receipts Properly to Claim Tax Breaks or Defend Future Value

Our final mistake veers into the financial/tax realm. Italy offers some fantastic tax incentives for renovations – from the 50% Bonus Ristrutturazioni income tax deduction to eco-bonuses for energy improvements, not to mention credits for seismic upgrades (Sismabonus) and even the recent Superbonus (110% credit, now scaled down). However, to take advantage of these, you must follow strict paperwork and payment procedures. It’s not like other countries where you might just claim a deduction for home improvement costs.

In Italy, you typically need to pay every contractor and supplier by a special tracked bank transfer – the famous bonifico parlante (“speaking bank transfer”) – that includes specific information: the tax code of the payer, the VAT number of the company paid, and a specific reference to the law (e.g. “Pagamento fattura X per lavori edilizi detraibili ai sensi della L. 449/97”).

If you pay cash or even by ordinary bank transfer, you forfeit the tax deduction. Moreover, you need to keep all the invoices and receipts in the proper format. The tax office can ask to see them even years later to confirm your claims. The official guidelines clearly state: to get the renovation deduction, one must pay by the dedicated bank transfer with all required details and retain the document as proof.

So, one common mistake is not informing your overseas bank or not using the correct payment method – an error that can nullify a 30,000€ tax credit in a blink. Always ensure your payments are done correctly (Italian banks have a specific “bonifico ristrutturazioni” form). And yes, keep copies of every fattura (invoice), bonifico receipt, and related paperwork in a safe place.

Beyond immediate tax rebates, good record-keeping helps in other ways. If you ever resell the property, you might need to justify the higher price due to improvements. Italy taxes certain capital gains on property sold within 5 years of purchase – basically the profit is taxable unless it was your primary home. But the law allows you to subtract documented renovation costs from the taxable gain.

Imagine you bought at €100k and sold two years later at €180k; you have an €80k gain. If you spent €50k on renovations (with invoices to prove it), you could reduce the taxable gain significantly, potentially saving a lot in tax. Without those documents, the taxman might tax the full difference. Also, under new rules, even sales beyond 5 years can incur some tax if boosted by Superbonus renovations, with only documented costs being deductible. In short, paperwork is king. It can secure your bonus claims and protect you in audits or future transactions.

Conclusion: Renovating Property In Italy Is Feasible, If You’re Careful

Renovating in Italy is an immensely rewarding endeavor – you get to bring new life to timeless structures and become part of a local community. But it’s also a journey through a labyrinth of regulations that might seem like an initiation rite from ancient Rome. By avoiding these ten mistakes, you’ll steer clear of the most common quagmires: you’ll verify what exactly you’re buying, budget for the less obvious costs, stay compliant with permits, and leverage the system to your advantage (hello tax credits!), rather than stumbling into its traps. When in doubt, consult professionals and don’t rush. Take your time to understand the rules – hopefully, our fact-checked pointers have shed light on them.

Buona ristrutturazione – happy renovating! Enjoy the process with eyes wide open, and soon you’ll be living la dolce vita in that beautifully restored Italian home, with far fewer headaches along the way.