Buying a house at auction: a practical guide in 4 points

Thinking of buying a house at auction? No, you don't need to be a lawyer or a legal expert, but a bit of preparation does help!
If the idea of landing a property at a great price appeals to you, here's everything you need to know to approach the auction with the right mix of awareness and boldness.

1. Why buy a house at auction?

Let's start with the good news: buying a house at auction can be a bargain. Here's why:

• 📌 Good price: auction houses usually cost less than on the traditional market.
  Do you know why? For 2 main reasons: first because the auction value is based on the real value estimated by an expert, but also because, if there are no bids, the judge schedules a new auction and lowers the price by ¼.
  And if you're the only bidder? You could take it “home” at the reserve price!
• 📌 Wide choice: large or small houses, in town or in the countryside. Just search the right portals, such as pvp.giustizia.it, astegiudiziarie.it or fallcoaste.it.
  Here you'll find all the information you're looking for, even if you found the listing on aggregator sites such as immobiliare.it or idealista.it.
• 📌 Smart investment: for example, you renovate and resell at a higher price. If you love DIY or property business, it's an opportunity to seize.

But be careful not to be charmed by the price alone! Read EVERYTHING there is to know about the property and follow our advice.

2. How to find out whether the auction house is a good deal? 💰

Before diving in, do your homework. Here's what to check:

• The Auction notice contains all the relevant information, including:

• • Date, time and place of the auction.
  • Auction base price.
  • Minimum acceptable bid.
  • Any minimum bid increments.
  • Deposit required.
  • Conditions for taking part.
• The Expert report: it's the document of truth. Here you'll find:

• • Floor plan (i.e. the layout of the house).
  • Estimated market value.
  • Condition of the property (vacant or occupied).
  • Possible problems, such as unauthorised building work or non-compliance.

You can usually find these documents on the official site where the auction is advertised.

• Total costs: on top of the auction price, you need to consider:

1. • Registration fees, taxes and notary charges.
   • Any costs of regularising building non-compliance or unauthorised work.
   • Possible costs of freeing the property (if occupied).

Finally, if possible, book a viewing: seeing it with your own eyes makes the difference.
Contact the court-appointed custodian and arrange an inspection. You may find that the “sea view” is more of a “ring-road view”…

3. How to take part in the auction 👨🏼‍⚖️

Have you found the listing for your dream house? Good, at this point you need to check how the auction will be held and how to take part.
In general, auctions can be in person or online:

📍IN-PERSON AUCTION:
It takes place at a set physical location, usually at the court or at the office of the professional delegated to the sale.
Here's how it works:

1. Taking part
a) Pay the deposit (usually 10% of the base price) by bank transfer or banker's draft.
b) Submit the application by the deadline stated in the notice and deliver to the court or the delegated professional:

• • Receipt for the deposit or banker's draft.
  • Application to take part with your personal details.
  • ID document and tax code.

c) Bring your documents: on the day of the auction, make sure you have a copy of the application and a valid ID document.

d) Registration: on arrival, you'll be registered as a participant.

Once bidding has closed, the property is provisionally awarded to the highest bidder. Over the following days, the court or the delegated professional checks that all the paperwork is in order for the final award.

2. How the auction runs

1. • The delegated professional opens the auction by reading the notice.
   • The property starts from the base price and follows the minimum-increment system (specified in the notice).
   • Bidders make their bids.

3. Provisional award

Once bidding has closed, the property is provisionally awarded to the highest bidder. Over the following days, the court or the delegated professional checks that all the paperwork is in order for the final award.

4. Balance and transfer of ownership

• • Payment of the balance within the set deadline (usually 60-120 days).
  • Transfer decree issued by the judge. The decree transfers ownership, replacing the notarial deed, and cancels any mortgages or attachments on the property.

👨🏼‍💻ONLINE AUCTION:
It takes place entirely online through an authorised platform. Depending on how bidders take part, it's further divided into asynchronous (no simultaneous participation, more common) and synchronous (with simultaneous participation). Here are the steps:

1. Registration and preparation

• • Register on the online platform: create an account on the platform stated in the notice and log in with SPID or a digital signature.
  • Pay the deposit: by bank transfer to the IBAN stated.
  • Upload the required documents: Fill in and submit the application online, uploading:
    • Receipt for the deposit payment.
    • ID document and tax code.
    • Valid contact details.

2. Taking part

• • Asynchronous auction:
    • You can make bids within a set period (e.g. 3-5 days).
    • You can enter a maximum bid that the platform will raise automatically up to your limit.
  • Synchronous auction:
    • It takes place in real time with all participants connected online.
    • Bids must respect the minimum increments stated.
    • The property is awarded to the highest bidder after a period with no further bids.

3. Notice of the award: you receive an email or a notification on the platform with the outcome of the auction.

4. Balance and transfer of ownership

• • Payment of the balance: Within the set time limits, pay the balance and the taxes due.
  • Transfer decree: The judge issues the decree transferring ownership.
    The procedure is identical to that of the in-person auction.

4. What if the house is occupied?

The scariest scenario: you buy the house and find… another tenant inside 😱

Don't worry! Straight after the award, the judge orders vacant possession with the transfer decree, which is also the title for starting the procedure with the bailiff 👮🏼‍♂️. The time needed to free the property generally ranges from 60 to 120 days.

Practical tips

📌 Be prepared: auctions can be very competitive and it's important to study the whole file to know what to expect and prepare a strategy.

📌 Careful with bids: once you've made a bid, you can't withdraw it. If you win and don't pay the balance, goodbye deposit!

📌 First time? A professional's help can be useful to avoid mistakes at the various stages of the procedure. Once you understand how it works, you can manage on your own too!

Good luck and happy bidding! 🏡

Applicable law

• Italian Code of Civil Procedure (CPC):
  • Art. 490 et seq.: Govern how court sales and property auctions are advertised.
  • Art. 560: Concerns the debtor vacating the property. After the award, the judge orders the property to be handed over, within 120 days (in extreme cases with the help of the court bailiff).
  • Art. 571 et seq.: Govern how to take part in the auction and how properties are awarded.
  • Art. 572 CPC: Provides that the award is made by the judge or the delegated professional appointed by the court.
  • Art. 586 CPC: Governs the order transferring the property to the successful bidder, which amounts to a transfer of ownership
• Ministerial Decree 32/2015: Governs the advertising of auctions on the Public Sales Portal (pvp.giustizia.it).
• Law 132/2015 (Reform of property enforcement): Introduces rules to speed up enforcement and make the sale process more transparent.
• Italian Civil Code, Art. 1470 et seq.: Apply to the sale of real estate, including in court proceedings, on a “sold as seen” basis.