Legal tip 176. Easy "rent with option to buy" market
06 November 2009 @ 14:45
As you all know, many developers who built flats to be sold and now can not find buyers are trying to allocate the property “to rent with option to buy”.
The taxes doctrine stipulated that this pass from the sale to the rent market represented an auto-consume and therefore they could not deduct the VAT paid on the purchase of the ground or floor. This has been making very difficult for developers to turn sales into rents with option to buy.
A recent consultation of the General Office for Taxes, states that a housing developer may deduct the VAT when putting their properties on the market for rent with option to buy. So a door open for the strengthening of this sector of the real estate market.
In the other side, the tenant´s side: Congress last month approved a reduction from 16% to 7% on VAT paid by tenants in leases with option to purchase, which is another incentive to this form of rent.
Have a great weekend. Weather keeps being awesome in Spain. It feels like our September is still here!
Information obtained from Cinco Días, 06th Novemeber 2009
Autumn´s remains by Xavier Fargas at Flickr.com