Rent 2 Buy

Following the success of Rent 2 Buy in other countries, Zafira decided that it was time to branch out and offer this exciting opportunity here in Spain.

It’s a simple idea which helps the property owner get that sale, but also helps out the buyer giving them time and space to arrange their finances and alleviates the need for a hefty deposit which I’m sure you’ll agree most buyers have trouble raising – especially first time buyers and those buying a holiday home.

So, How Does It Work?

After a sale price has been agreed, the buyer pays an initial deposit of approximately 4,000é (dependant on the agreed asking price of the property) and a rental period and rate is agreed upon (normally one year and 500é per month).

After the deposit has been paid and the rental period has been agreed upon, a comprehensive and fully binding contract is drawn up and signed by both parties which covers all the legalities of both the rental period and the subsequent sale of the property.

But Why Does It Work?

For the buyer, they only have to find the smaller initial deposit of 4,000é and then pay the monthly rental. The monthly rental money comes off the price of the property so this saves them from having to find a larger deposit and in reality gives them a year’s free rental as long as they complete the sale.

For the seller, they have a guaranteed sale that releases some income straight away, gives small paybacks throughout the year and they know when the completion date is going to be so can arrange their finances accordingly. Also, if property prices continue to drop, they are guaranteed a sale price based on today’s prices.

What If It All Goes Wrong?

Obviously nothing in life is guaranteed so both parties are covered in the event that either side backs out, though history has shown that this is less likely to happen than in a traditional sale.

If the buyer pulls out they forfeit the initial deposit paid plus the rental, so from the owners point of view the property has yielded income for them. If the owner pulls out they have to give the initial deposit paid back in duplicate, so from the buyers point of view it’s nothing more than a standard rental and they have a nice return on the deposit money.
If either side breach the contract then the above also applies.

OK, Exactly What Happens Next?

 

During The Rental Period

For both parties the rental period is exactly the same as a standard property rental, the owner of the property remains the owner throughout this time.

First of all an inventory is done of everything left in the property and we have all the facturas for the property re-directed to the Zafira office so that we can monitor the utility usage and ensure that all the facturas are being paid – the last thing anyone wants is for debt to be incurred on the property and utilities to be disconnected.

The buyers have the responsibility for covering the water, electricity and telephone bills and the property owner has to cover SUMA and community fees. On the agreed date the buyer has to come into the office to pay the rental and they will be notified of any utility facturas which need paying – the contract stipulates that the rental has to be paid within 5 days of the agreed date and non-payment will invalidate the contract and the buyers forfeit their deposit and have to move from the property.

The rental and utility money (minus a standard property management fee) are paid into the owners nominated bank account each month.

During this time the buyers have to maintain the property and contents in it’s original condition but can make improvements with the owners consent. Zafira have the right to inspect the property and will take responsibility for the owners post and ensuring that the contract is not breached (for more details of how we will look after the property see our Property Management Packages information).

After The Rental Has Ended

When the rental period is coming to an end we prepare all the paperwork and agree a date for everyone to go to the notary in order to complete the sale (if the owner does not want to return to Spain to complete we can arrange a power of attorney for you). All the conveyancing will have been done on the property so both parties have no worries about this side of the sale and can proceed worry free. As we have had a year to get everything in order you are guaranteed that all the paperwork will be ready so hopefully no hitches on the day!

Once we have completed at the notary the property becomes the new owners responsibility and all facturas will be changed over into their name –simple and painless with no disruption to either side!