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Barely owned real estate operations grow 30% until August

MADRID, 11 Sep.

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Barely owned real estate operations grow 30% until August


Home sales under bare ownership contracts grew by 30% until August compared to the same period in 2021, according to data from Mas Vida, a company specializing in financial solutions aimed at helping older people make their real estate assets profitable.

Bare property sales are a type of operation in which those over 65 years of age transfer ownership of their home in exchange for a single payment or a life annuity, but can continue to enjoy their home until their death.

If the operation is carried out on a property that is the main residence, it is exempt from the tax on capital gains. It is a growing market as it is a way to complement pensions and obtain liquidity while maintaining the usufruct of real estate for those who make them.

According to INE data, in 2008 there were 2,989 sales of bare property in Spain, an amount that decreased to 1,046 that were transmitted in 2020 with this modality. In 2021, this market grew again and exceeded 2,500 operations, a trend that is multiplying in 2022.

"In recent months we have been noticing a great increase in interest in all these types of products that serve to complement retirement pensions: sales of bare property, reverse housing or with guaranteed rent and reverse mortgages", explains the managing partner of Mas Vida Julian Franco.

In Spain there are currently more than 10 million retirees, 85% of whom receive pensions below the Minimum Interprofessional Salary (SMI). Life expectancy in the country is 83 years and the average retirement pension is 1,255 euros.

"20% of this type of operation is carried out by foreigners residing in Spain, especially in the Mediterranean area, and 30% of those who invest in this type of property are institutions and 70% are property investors. The average time to formalize this type of transactions from the moment the pensioner signs the application until the operation is closed with an investor is about 5 weeks on average", adds Franco.