Real estate leasing: an alternative to home loans

Are you buying your own home and looking for alternatives to traditional home loans? Real estate leasing may be an option to consider.

This financing model is based on a lease-purchase contract. The financial institution acquires the property and lets it to the client for a monthly rent for a contractually defined period. At the end of the contract, the client can exercise the option to buy by paying the residual value – i.e. the amount remaining to purchase the property, corresponding to the difference between the total value of the property and what has already been paid over the course of the contract.

Duration and legal framework

Under current legislation (Decree-Law no. 149/95), the duration of a real estate leasing contract cannot exceed 30 years. During this period, ownership of the property remains with the financial institution and the client has the exclusive right to use it.

Advantages of real estate leasing

• Contractual flexibility: the possibility of adjusting monthly rents to the client’s financial capacity, with extended terms of up to 30 years.
  
• Lower initial costs: there is no immediate mortgage registration, which reduces notary and tax charges in the initial phase.
  
• Option to buy at the end: the client decides whether to buy the property, paying the residual value, or return it to the financial entity.
  
• No need for a mortgage: this can be advantageous for those who want to avoid this type of encumbrance.
  

Disadvantages to consider

• The property is not immediately owned by the client: ownership is only transferred once the residual value has been paid, if the client exercises this option.
  
• Owner’s responsibilities during the contract: the client assumes charges such as maintenance, compulsory insurance and payment of IMI, even though they are not legally the owner.
  
• Residual value at the end: the client must be prepared to pay this amount, which can represent up to 10% of the initial value of the property.
  
• Less liquidity in the event of withdrawal: if the customer decides not to buy, the rents paid are not refunded.
  

Real estate leasing can be particularly interesting for companies, self-employed professionals or individuals looking for greater flexibility and not requiring immediate ownership of the property. However, its suitability should always be assessed on the basis of each client’s financial situation and objectives.

We help you analyze all the options available to you, in a clear and personalized way, so that you can make informed and sustainable financial decisions.