Calculate the value of the property in Italy in a few simple steps

Calculating the value of real estate in Italy is a must if you are planning to sell your home or if you need to know the tax base for property taxes. This is how to calculate the value of the property in Italy in a few simple steps.

How do you know how much a house is worth in Italy?

In order to calculate the value of a property in Italy, there are two main ways the owner can go about it:

• the calculation of the market value
• the calculation of the cadastral value

These are two operations that aim to achieve two distinct objectives. While the calculation of the market value makes it possible to determine the price for the sale of the property, the cadastral value makes it possible to identify the taxable base for the application of property taxes and to establish the minimum price.

How to calculate the market value of a property?

The market value of a property is used to estimate the sale price of the house on the date of valuation in order to allow the conclusion of the sale-purchase contract between parties not influenced by external factors.

To calculate the market value of a property, it is necessary to know:

• the commercial surface area of the property
• the quotation per square metre based on the location of the property;
• the coefficients of merit.

Once the variables are obtained, the market value is obtained by multiplying the commercial surface area by the quotation per square metre by the coefficients of merit. So, if we take into consideration a property with a commercial surface area of 109 square metres, in an area valued at 6,590 euros per square metre, and with characteristics corresponding to merit coefficients of 8% to be subtracted from the total, the example for calculating the market value of the property with these characteristics would be: 6,590 euros x 109 square metres -8% = 660,845.20 euros. This figure corresponds to the market value of the reference house.

Surface area, square metre quotation and real estate merit coefficient table

The property valuation parameters for determining the price are, therefore, the commercial surface area, the quotation per square metre of the location where the house is located and the table of property merit coefficients. But what exactly are they?

The commercial surface area differs from the floor area in that, in addition to the covered walkable surfaces, which are commonly regarded as the actual square footage of the house, it also includes the measurement of the uncovered surfaces and outbuildings.

Calculating the price per square metre is an operation that requires consultation of the Osservatorio del Mercato Immobiliare database. By visiting the website of the Agenzia delle Entrate (Italian Revenue Agency), it is possible to view the OMI data for calculating the value of the property, which is necessary to value the house according to the area in which it is located.

The table of property merit coefficients includes percentages of amounts that must be added to or subtracted from the value obtained from the previous parameters. These amounts are determined on the basis of certain characteristics such as the floor, the state of preservation of the property, the view, the brightness and the energy class.

How to calculate the value of a property by cadastral rent?

The cadastral annuity is the value of the property that the tax authorities determine in order to quantify the income generated by the property. Calculating the value of a property from cadastral rent means knowing the tax value of the property in order to identify the taxes to be paid on the property (e.g. IMU). The cadastral annuity is calculated by multiplying the following variables:

• the consistency of the property, i.e. the surface area, rooms and volume;
• the valuation, i.e. the numerical value identified by the Revenue Office based on the location and intended use of the property.

By multiplying the exhumation rates by the consistency of the property, it is possible to find out the cadastral income of the property.

In order to obtain the final cadastral value, it is necessary to look at the coefficients of merit, i.e. the cadastral categories in which the property is registered on the basis of its use (e.g. residential use). Calculating the value of the property from the cadastral rent is possible using the following formula: [cadastral annuity + (5% of cadastral annuity)] x coefficient of merit.

The final calculation of the house value

Calculating the value of the property is crucial, especially if you intend to sell the house. But who should you get your house valued by? If you have the necessary values referable to the house, you can rely on practical online free property value calculation tools or, alternatively, you can rely on real estate agencies and other specialised operators in the field.

• Find out how much your property is worth with idealista's free valuation tool