HomeNewsLeakage In Rental Sector, 20% Of Expiring Contracts Are Put Up For...

Leakage In Rental Sector, 20% Of Expiring Contracts Are Put Up For Sale

The Rental Negotiating Agency (ANA) warns that the uncertainty generated by the new Housing Law is already having an impact on the rental market. Specifically, they warn that apartments for rent are being transferred to the sale and purchase market .

” Between 15% -20% of our clients who are owners of rental housing, when the contract expires, they decide to withdraw it from the market and ask us to sell it, ” explains José Ramón Zurdo, general director of ANA, who assures that the new Regulations, still pending approval, arouses many fears in the sector , which is made up of 90% of private owners. Zurdo points out that before this uncertainty occurred, only 2% of the flats in which the contract expired were put up for sale .

The manager warns that this trend will surely increase in the coming months , since really although it has been “said that the new Housing Law was not going to harm small landlords, it is the opposite, since the most immediate impact will be for them”. Thus, they point out that the regulation includes a “lengthening of the duration of the leases made by small landlords natural persons, made in stressed areas up to eight years with a possible optional extension of another three years, up to eleven years.”

In addition, there will be a loss of ten percentage points in the tax reduction, which goes from 60% to 50% , even in homes located in non-stressed areas (probably the majority of rental homes).

Likewise, they warn that in the event that a private owner who has a flat in an area declared as stressed decides to lower his rent by 5% to obtain the maximum bonus in personal income tax of 90%, he could incur losses . The company gives a practical example and points out that “in an area declared stressed for three years, an income of 700 euros that would last up to eight years, the owner would stop earning 1,252 euros, having accepted this formula”, he says Faustino de Vega, legal director of ANA.

This situation, of losses for the small owner, occurs because at the end of the declaration of stressed area, the tax credit goes from 90% to 50%, while the reduction of 5% of the rent continues until the end of the contract.

How to circumvent the regulations
ANA also exposes using the figure of temporary usufruct in the rental of housing , collected in article 13.2 of the urban leasing law, it would be legally mocking the longer duration of the leases that the new Housing Law will impose and this “is a question for which they are asking us a lot even from the administrations “.

Ron Willshttps://wideworldmag.co.uk
Ron Wills is Based in Cape Town and loves playing football from the young age, He has covered All the news sections in WideWorldMag and have been the best editor, He wrote his first NHL story in the 2013 and covered his first playoff series, As a Journalist in WideWorldMag Ron has over 8 years of Experience.

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