Italy protects against bankrupt builders

This month a new law comes into force protecting buyers in Italy against bankrupt builders, reports Italian magazine.

The Law Decree 122/2005 will offer protection to those purchasing new builds on the condition that they are a private buyer, they have bought from a building company and that the property has not been declared habitable before 21 July 2005.

Construction companies are now legally obliged to provide a bank guarantee of the price of a property for a contract to be valid. Under the new law, building companies must prove to the financial institution providing the guarantee that they are financially stable.

The law stipulates that contracts must include a full list of all building materials and contractors used. It is also now compulsory for builders to supply a 10 year building insurance.