Mortgages in Italy: New Opportunities and Restrictions for First-time Homebuyers in 2024

The year 2024 brings changes to Italy’s mortgage legislation, aimed at supporting young families and those aspiring to become homeowners. The latest Budget Law introduces several bonuses and limitations that are crucial for potential homebuyers.

State Guarantee and New Categories

First and foremost, the 80% financing state guarantee is reinstated for young individuals up to 36 years old with an annual income (ISEE) of less than 40,000 euros. However, from this year onwards, the right to the guarantee is extended to multi-child families with different ISEE thresholds depending on the number of children in the family.

First Home Bonus

Introduced by the Draghi government, the first home bonus is designed to ease the purchase of a home for young people with limited savings. This bonus provides an 80% state guarantee, allowing banks to bear only 20% of the risk.

Various ISEE Thresholds

Families with three dependant children and ISEE up to 40,000 euros can apply for guaranteed financing. With four children, the ISEE threshold increases to 45,000 euros, and for families with more than 5 children and an income limit below 50,000 euros per year, the guarantee reaches 90%.

Restrictions for Young Borrowers

However, for those under 36, except for the guarantee, the period of tax benefits concludes, and they will again be obligated to pay taxes on registration, land registry, and mortgage.

Challenges in Mortgage Accessibility

Young people also lose the right to a tax credit, complicating access to mortgages after the interest rate hike in 2022-2023. High inflation and modest changes in wages add additional challenges.

Mortgage Offers and Loan Costs

Statistics indicate that the cost of mortgages in Italy is rising, with a quarter of issued loans surpassing 80% of the property’s value in 2023. The average age of first-time home purchase has also increased to 38 years.

Bank Mortgage Offers

For those considering a mortgage, banks present diverse offers. For instance, a mortgage request of 100,000 euros over 30 years for a property worth 200,000 euros may result in monthly payments ranging from 421 euros to 444 euros, depending on the bank.

New opportunities and restrictions in Italy’s mortgage landscape in 2024 are geared towards supporting young families and those with multiple children. However, with the rising cost of loans and the complexity of accessing tax benefits, the younger generation will need to carefully assess their options before purchasing their first home

Mortgages in Italy: Steps and Rules for Real Estate Purchase

Italy, with its stunning landscapes, rich history, and unique culture, attracts many investors seeking to fulfill their dream of owning property in this beautiful country. If you are considering obtaining a mortgage to make this dream a reality, here are the key steps and rules for securing a mortgage in Italy.

1. Document Preparation

Ensure you have all the necessary documents. This includes your passport, residency permit, tax declarations, income statements, employment contracts, and bank statements.

2. Financial Stability

Banks thoroughly analyze the financial position of borrowers. Provide information about your monthly income and expenses to help the bank assess your ability to repay the loan.

3. Loan Amount and Interest Rate

Research various banks and their offerings regarding the maximum loan amount and interest rates. These terms can vary, so it’s crucial to choose conditions that align with your financial capabilities.

4. Loan Term

Select an optimal loan term based on your financial goals and capabilities. Different banks offer various repayment periods, so choose one that suits your needs.

5. Insurance

Take into account the bank’s insurance requirements. Typically, insurance for property damage and life insurance for the borrower are required.

6. Fees and Charges

Inquire about all possible fees and charges that the bank may impose. Consider these in your overall mortgage cost calculations.

7. Valuation Procedures

Prepare for property valuation procedures conducted by independent experts. They will assess the property’s value to determine its suitability as collateral.

8. Credit History

Maintain a good credit history. A positive credit history can significantly facilitate the mortgage application process.

9. Borrower’s Age

Be aware of age restrictions for mortgage applicants. Some banks may have age limits, considering the borrower’s age at the end of the loan term.

10. Collateral

Remember that the property itself serves as collateral for the loan. Ensure you have all the necessary documentation for the real estate in question.

By following these steps and adhering to these rules, you can streamline the process of obtaining a mortgage in Italy and bring your dream of living in this enchanting country closer to reality. Consult with professionals and banks for detailed information and current regulations. Best of luck in realizing your plans!





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