Relocation Country Guide: ITALY
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Relocation Country Guide: ITALY September 2017 Relocation and International Assignment Trends and Practices Located in the heart of the Mediterranean Sea, Italy shares open land borders with France, Switzerland, Austria, Slovenia, San Marino and Vatican City. The country is renowned for its arts and cultural treasures, as well as beautiful landscapes and world-leading cuisine. It is becoming a more frequent destination for assignees and the high quality of life there, means it is a popular destination for expatriates. Input from Cartus Global Supply Chain and our Destination Services Providers on the ground in Italy points to several key areas of importance to the expat community. Of primary importance is looking for a rental property, finding a school, transportation, language, cultural issues and climate. These areas are all addressed, with best practice recommendations, to help guide relocation managers as they consider policies for their assignees. September 2017 Relocation Country Guide: ITALY RENTAL MARKET As rental properties are not typically viewed as investments, landlords tend not to devote time to maintaining them. Assignees should be made aware of this before a home search trip begins, as the standard of expatriate properties in Italy may be lower than elsewhere in Europe. The types of properties available – in terms of quality, size and price – depend considerably on the area in which the assignee is relocating. In more rural areas, prices may be lower, but so is availability. Whereas, there is more choice in major cities like Rome and Milan, but prices are higher. Although, in general, properties in Rome are of a lower quality than they are in other cities and there are also less fully furnished options in the capital. Property-types available include apartments, houses and villas, although the latter can be scarce in central areas of cities. Parking places, garages and gardens are also typically only available with luxury properties and very scarce in the current rental market. Rental Rates and Charges The cost of accommodation varies greatly by location. In general, properties in the north are more expensive. Below is an outline of the average rental rates in Milan (north) and Rome (south) in Euros, per month: APARTMENTS Accommodation size 1 bedroom 2 bedrooms 3 bedrooms 4 bedrooms Rome €1,000 €2,000 €2,500 €3,500 Milan €1,500 € 2,500 €3,200 €4,500 HOUSES Accommodation size 1 bedroom 2 bedrooms 3 bedrooms 4 bedrooms Rome N/A N/A €5,000 €7,000 Milan N/A N/A €6,000 €8,000 Note: Rental cost estimates are based on partially furnished properties, excluding condo charges and utility bills. Rents shown are for personal leases. A rental increase of up to 40% may be applied for corporate leases. Negotiating with Landlords/Real Estate Agents The Italian rental market is landlord-driven and there is little room for negotiation. Most properties will be leased as viewed, with landlords often unwilling to meet tenant requests, especially in areas where demand is high. Corporate leases are not favoured by landlords either, as they are subject to higher tax rates. Verbal agreements are not binding in Italy, which needs to be remembered when discussing terms with landlords or real estate agents. The only way to secure a property is by submitting a written and binding proposal to the landlord. In some cases, assignees will also be required to make a down payment of one month’s rent, which is lost if the assignee changes their mind, so it is not advisable to conduct multiple property negotiations. CARTUS | RELOCATION COUNTRY GUIDE | ITALY | SEPTEMBER 2017 PAGE 2 OF 8 September 2017 Relocation Country Guide: ITALY Leases TOP TIPS FOR SUCCESS The two most popular property leases are: • When scheduling home search trips, • ‘4+4’ - four years with the option to renew for another four assignees and organisations should be • ‘3+2’ - three years with the option to renew for an mindful that many businesses, including additional two real estate agents close during lunch hours and stay open later, often closing at Signing a lease may take up to a month and in some cases, approximately 7pm. even longer. In some cities, local laws prevent landlords from • As signing a lease can take up to a month offering short-term leases, so organisations scheduling short-term or longer, be sure to build this possible assignments should check whether this impacts the host location. delay into your relocation schedules. This will help to avoid missing assignment Searching for a Home start dates. Assignees should avoid searching for a property online, as real • Organisations should be aware that estate websites are not updated regularly and when they are, they landlords prefer personal leases and may include inaccurate or misleading information. Instead assignees as such may opt to give the property should work with Cartus’ local destination services provider to source to someone else if a corporate lease becomes too complex. This is especially suitable accommodation. It can also be extremely challenging to the case in areas where demand is high. organise viewings of rental properties, as real estate agents and If a corporate lease is used, then rental landlords are not always willing to open up properties for this rates may be higher, as landlords try to purpose. With this in mind, assignees will need to have patience off-set the cost of paying higher tax rates. when conducting a home search trip. • To ensure assignees secure the property that they want in a timely manner, they Learn the Language should have funds available to pay Property terms and phrases in Italy can have slightly different the security deposit and supporting documentation to hand immediately after definitions to other countries: the viewing. • Unfurnished (non arredato) means that there will be nothing • Organisations should be mindful of in the property, with walls, ceilings and floors completely bare, extra costs associated with unfurnished including the kitchen. options and need to decide (before the • Semi-furnished or partially furnished (parzialmente home search) whether the assignee or arredato) properties will typically have an installed kitchen the organisation is responsible for the and wardrobe closets, although the rest of the property will cost of household goods shipments or be empty. renting furniture for the property. Italy’s high cost of amenities (particularly gas • Fully furnished ( ) properties will include all furniture arredato and electricity) should also be considered and electrical appliances. Although this does not include bed when setting housing allowances. linens, towels, plates, cutlery and kitchen utensils. • Where local laws prevent landlords Assignees should be aware of these terms before a home search trip from offering short-term leases, begins, as it can be quite surprising to walk into a completely empty we recommend that organisations property, where not even light bulbs are included. consider serviced accommodation for short-term moves. CARTUS | RELOCATION COUNTRY GUIDE | ITALY | SEPTEMBER 2017 PAGE 3 OF 8 September 2017 Relocation Country Guide: ITALY SCHOOLING TOP TIPS FOR SUCCESS The choice of schools for expatriate children in Italy, is not as varied • Due to limited availability, assignees with as other western European countries. Having a small selection school-age children should apply for a to choose from means that availability is often low, with the most school placement as far in advance as popular ones having long waiting lists or, in some cases, being possible. Organisations should also send completely full. Indeed, often locals choose to send their children to authorisation for school assistance to their international schools, which can make it even more challenging for relocation service provider as soon as an assignees to secure a school place. assignment is confirmed. • Organisations should allow plenty of time Popular international schools include: in the relocation schedule for assignees to • Rome: American Overseas School of Rome view schools, as families may not always https://www.aosr.org/ and Marymount International be able to secure a placement in their School Rome http://www.marymountrome.org/ preferred option. • Milan: American School of Milan • As annual international school fees can https://www.asmilan.org/ and International School of Milan be high, assignees relocating without http://www.internationalschoolofeurope.it/it/milan a school allowance, may find it very challenging. Should school fees not • Naples: The International School of Naples be covered in relocation packages, http://www.isnaples.it/ and TAIS Naples organisations could consider this cost http://www.taisnaples.it/ when determining an assignee’s level of compensation or lump sum allowance. School Fees For Rome’s international schools, application/enrollment fees can cost around €800 and a capital assessment fee (per family) will be charged at approximately €5,500, which are both non- refundable. Tuition fees can range from €16,700 per year for primary level and up to and exceeding €21,500 for senior secondary level. School uniforms, school transportation, books and other materials are at an additional cost. When taking school tours, we recommend that assignees bring school reports from previous schools, copies of birth certificates and testimonials/references from teachers. CARTUS | RELOCATION COUNTRY GUIDE | ITALY | SEPTEMBER 2017 PAGE 4 OF 8 September 2017 Relocation Country Guide: ITALY TRANSPORTATION Public Transportation Major cities including Rome, Milan, Naples and Turin have extensive metro and bus services, with smaller metros in Genoa and Catania. TOP TIPS FOR SUCCESS The reliability and quality of public transportation varies by location. • To ensure a smoother settling-in process, In Milan for example, it is quite efficient and the network covers the organisations should consider providing majority of the city. Indeed, in many cases it can be quicker to get the assignee with a car and driver for the from one location to another using Milan’s public transport than first week of their assignment.