housing market
More people are now opting to rent a property
Builders are now looking more into the rental market and making it more attractive for ordinary people to rent instead of buying outright
10.05.08 - 10:22 -
Until now, renting has not been a popular option. / SUR
Spain has traditionally been a country in which most people like to own their own homes, but with apartment sales falling all the time, the builders are now looking more into the rental market, and making it more attractive for ordinary people to rent instead of buying outright. Recent figures from the Public Rental Society (Sociedad Pública del Alquiler), an entity of the Housing Ministry, tell us that only in the second half of last year, this institution had a total of 6,500 new houses to rent, which represents 15 per cent of the total number the group has on offer.
Big companies such as Martinsa-Fadesa have already announced their intention of moving into the rental market, especially with respect to council housing, given that they have at their disposal enough land to build up to 20,000 new houses of this kind. Other companies, including Habitat, have also decided to go into the sector with plans to launch 1,400 new houses for rent on the market, all with options to buy. The granting of first purchase options is one of the attractions offered by these companies, allowing first-time buyers to rent at relatively low cost and save enough at the same time to purchase the property they are already living in. In the end, everybody wins.
From tenant to buyer
Emilio Jaime Sánchez, Malaga representative of the Ñ XX1 Group, explains the system his company is using. “The amount of money paid in rent by the client is eventually discounted from the purchase price of the house, if the client decides to take up his option to buy during an established period of time, which is three years. And also, while paying rent on the house, he knows what all his costs will be,” he adds.
The Hexa executive Jesús Cabello says that in the case of his company, the business of renting is separate from purchasing. “we see that renting is becoming more acceptable all the time. That is why we are renting houses in areas such as El Parque Litoral. These houses either belong to us or to other companies.”
The public administrations are also pushing the concept of renting instead of buying, and are trying to find ways to make rents more accessible to more people while at the same time seeking solutions for first-time home buyers. The government, some time ago, announced a package of fiscal measures aimed at companies involved in home building, to encourage them to restore and rent out old apartments.
Offering reduced tax rates, the government is trying to alleviate the situation being suffered by most building companies right now by helping attract more buyers.
