It wasn't $1.
You’ve probably seen this headline before: Charming Italian town is selling beautiful homes on a picturesque mountain for $1. It immediately fills your imagination with dreams of living the Eat Pray Love life in the heart of Tuscany, while eating grapes straight from your own vine. All of your vacation plans for the next few decades are squared away. All you have to do is come up with the cash to renovate the house–say $20,000 minimum–and/or establish a business in the town by a specified period to establish residency. Sounds easy enough, right?
My dream has always been to own my own hotel or B&B. So when I heard about these $1 houses in Italy, I immediately came up with a million ideas for monetizing this opportunity not just for myself, but for the local community. So on two different occasions, I submitted an application to buy this $1 house, thinking I’d be vacationing in my future B&B in no time. However, the experience was much different than I expected.
The Application Process
The application process for securing a $1 house in Italy varies. The first time I did it, the website was completely in Italian and so was the application. There was no English version to switch to, so I had to turn to Google Translate to make sense of it all. When I finally managed to read and submit the application, I got an email (again, in Italian) stating there was a waitlist and I’d be notified if a house became available. I never heard back.
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So, more recently, I submitted another application for another $1 house in Sambuco, a small town in Sardinia. This time, there was an English version of the website, which made it significantly easier to navigate. I submitted an email, as instructed, stating my interest and intentions for the property. I received a reply inviting me to review the list of available properties and submit an application. Which, thankfully, was available in English as well. It looked like I was well on my way to securing a $1 house.
The Catch
If you do snag a house for $1 and you get your 5,000 euro deposit back, there’s still more money to spend.
Upon reading the application instructions, I noticed some language about transferring 5,000 euros to secure a bid. I scrolled down further and there was additional language about the sale being carried out via public auction, and that $1 is the first bid. I followed up with the contact who sent me the instructional email and he did not mention anything about an auction, but he did confirm that I would have to submit a 5,000 euro deposit. This deposit is refunded after renovations are complete.
At this point, the $1 houses were advertised all over the United States. How would I know that I’d get my deposit back if I wasn’t able to snag one of these houses?
The Other Catch
If you do snag a house for $1 and you get your 5,000 euro deposit back, there’s still more money to spend. Buyers must spend at least 15,000 euros to renovate their new home over three years. How bad could these houses be? It varies. As Jim Higginson learned on House Hunters International, these $1 houses range from perfectly acceptable fixer-uppers to uninhabitable. And it’s hard to tell which is which based on the few photos that come with each property. So it really is a good idea to go there and look at the property in person before submitting a bid. If you don’t, even though you’re only paying $1 (plus a 5,000 euro deposit), you may end up in a 430-square-foot home that looks like it barely survived the bombing of Baghdad. To then spend approximately $20,000 renovating a place that small may turn a bargain into a money pit.
My Decision (and My Advice)
In the end, I decided to pass on the $1 house in Italy. I knew these houses required renovations, but to purchase a home sight unseen meant I might end up with one half as big as I had anticipated. With so many people expressing interest in these homes, I knew they had more applicants than homes available. Sending 5,000 euros to a government official in a foreign country to secure a house that may already have been sold didn’t sound right to me. Especially since there would be no way to get those funds back if the home wasn’t available.
Should you consider buying one of these $1 homes? Maybe. They do exist and people do buy them. To cut down on the risk you’re taking in this gamble, I recommend that you take your list of properties, fly to their location and hand-pick one yourself.
When I realized the extent of time, work, and commitment, I saw that I couldn’t do all of those things remotely. Maybe when the next Italian town runs a sale I’ll be better equipped and ready to spend a little while in Italy house hunting. But at the moment, I don’t have the time to plan out a major home renovation in a foreign country.