How rent to buy in Javea works
The Rent to buy contact is an agreement between the Owner/Landlord and the Tenant where a specific property is rented to the Tenant over a specified period, a monthly rental amount is agreed and also the sale price of the property is agreed, A deposit normally between 5% - 10% is paid upfront and a one months rent is paid in advance. The Owner/Landlord is responsible for the upkeep of the property until the completion of the purchase at the Notary, also the Owner/Landlord is responsible to pay for Town hall taxes, or community charges if the property is located in a complex, garden and pool maintenance. The Tenant is responsible to pay the monthly rental amount, the rubbish collection from the town hall (Basura) plus all of the utility bills including Water, Electricity, Gas, Wifi, alarm. at the end of the agreed term all rents and deposits that have been paid are deducted from the sale amount. The completion date can be brought forward at any stage. If the Tenant decides at any stage that they cannot proceed, they would lose all deposits and rent paid.
For the Tenant
1, Find a suitable property
2, Offer and agree the sale amount (between 5%-10% of this amount is payable as deposit)
3, Agree monthly rental amount (One month rent payable in advance * total paid to be deducted from sale amount)
4, Agree the term of the contract (Between 1-3 years)
5, Sign an official Rent to buy contract
6, Move into your new Property
With the Rent with option to buy in Javea the Tenant would search and find suitable Rent to buy properties in Javea or surrounding areas, once the Tenant has found a suitable property they would then rent it for a period of 3 to 5 years, all rental terms and conditions are exactly the same a normal long term rental contract. At the end of the contract you then have the option to purchase the property, this allows you to live in the property and save up over the period to make the final purchase. if you decide that the property is not right for you, you are not obliged to purchase the property at the end of the contract period also at any stage throughout you have to right to 1, Bring the completion date forward (All payments at this stage would be deducted from the sale price) 2, Cancel the rental agreement and leave the property (All payments would be lost at this stage)
Responsibilities and payments of the Tenant:
1, Pay the monthly rental amount
2, Pay for all utility bills, Wifi, alarm
3, Agents administration fee equivalent of 1 months’ rent + IVA at the start of the agreement.
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For the Owner/Landlord
1, Agree the sale amount (between 5%-10% of this amount is received as deposit and is none refundable)
2, Agree monthly rental amount (one month rent payable in advance * total paid to be deducted from sale amount)
3, Agree the term of the contract (Between 1-3 years)
4, Sign an official Rent to buy contract
By entering a contract to Rent to buy in Javea or any other area, you are increasing the chances of selling your property, you might have had your property on the market for sale for a long time and not have been successful in finding a buyer. If at the end of the Rental period the Tenants decide not to go ahead and purchase your property, at least you would of had the benefit of the monthly rental that you have received, plus the none refundable deposit. As the Owner/Landlord you allow the tenant to rent for a period of 3 to 5 years, all rental terms and conditions are exactly the same a normal long term rental contract. At the end of the contract or at any time during the rental period, the tenant has the option to purchase the property, all monthly rental payments, plus the deposit will be deducted from the purchase price. If at the end of the rental period the Tenant decides that the property is not suitable for them, they are not obliged to purchase the property, all monthly rental amount paid plus the deposit will be kept by the Owner/Landlord. The Tenant is also allowed to cancel the agreement and vacate the property at any time during the rental period, they would lose any rental amounts paid plus the deposit.
Responsibilities and payments of the Landlord/Owner:
1, Town hall, mortgage payments, community charges must to be kept up to date.
2, To Maintain the property including pool and garden maintenance and to take care and pay for any repairs
3, Agents administration fee for Rental equivalent of 1 months’ rent + IVA at the start of the agreement. to cover the whole of the rental period
4, Sales Commission for Sale Initial fee to the equivalent of 25% of the initial payment instalment plus IVA at the start of the contract.The Sales commission payable by the Owner/Landlord would not exceed more than 5% + IVA commission of the sales value.(until sold at notary) The initial fee and annual rental admin charges are deducted from the 5% + IVA commission (of the sales value) when contracts are finalised at notary.
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