One of the most cost-effective ways of investing in the Italian real estate market is buying a fixer-upper property.When investing in a ruin, it is possible to spend $175,000 on the purchase and renovation, then flip the property for twice as much when work is completed.Apart from the impressive return on investment, the other advantages include being able to stagger the costs of renovation over as many months or years as you feel comfortable with. In addition, mass migration from Italy's countryside has left a large stock of empty rural properties.As with any real estate investment, though, there are basic guidelines to follow to ensure things don't turn sour.Some pointers (already covered elsewhere on this site) include:

In addition, there are dos and don'ts specific to investing in renovation real estate.What to buy: Many investors are tempted by the idea of starting with an empty plot of land. But it is often advisable to purchase land with a ruin already on it, which you can then either renovate or demolish and reconstruct. This ensures that the plot has been legally classified as building land. Some plots on the market are classified as agricultural land and cannot be built on.Location: An Italy real estate listing website such as this one should give you a good choice of options. Assuming you view this as an asset you plan to resell, keep in mind locations that will maximize later saleability. That typically means being within easy reach (90 minutes or so) of an international airport as well as the coast. Sea or countryside views, good transport links and being close to amenities such as grocery shops are always a plus. Tuscany and Umbria are most popular with foreign buyers but are also among Italy's most expensive places in which to buy. Regions such as Abruzzo, Calabria and Sicily are less expensive alternatives.Costs and financing: For the most basic work, budget at least $550 per square meter. For a comprehensive renovation in, say, Tuscany, that can rise to $2,500 a square meter – or $250,000 for a 100 square meter property. Extras that can send your costs spiraling include improving countryside access lanes (expect up to $12,000-$13,000 for a 100-metre stretch) and swimming pools, which can set you back up to $50,000.Owner-financing is virtually unheard of here, which leaves you reliant on a cash purchase or obtaining a mortgage. Italian financial institutions will lend around 80 percent of the total cost of your property plus associated renovation work.Mortgages are typically not granted for complete ruins, for properties costing less than $100,000, or if you do not already have planning permission. Cash is typically advanced to the buyer at various stages of rebuilding.Planning permission: This is a country steeped in bureaucracy – there is no getting around it. A surveyor should design your project, which then needs to be submitted  to the local authority for approval. This usually involves a lengthy wait – six months is not uncommon for major projects – for which the application fee can be up $15,000.Don't be tempted to go ahead without permission as it is illegal, and will make selling the property a nightmare. Generally, buildings can be extended by up to about a third, with greater leeway if you are demolishing an existing property to rebuild it. Permits typically last three years and can be renewed for a further two.Getting started: Your realtor should have a shortlist of experienced builders. Try to visit examples of their work in person. Building projects have a habit of running over time and budget, so ask your realtor or surveyor to draw up a contract with your workmen specifying costs, and when you want the work completed. You can insist on cash penalties if these requirements are not stuck to. Your surveyor can also keep an eye on the progress of work in your absence, keeping you up-to-date with photos and videos.