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Wednesday, 09 September 2015 11:13

New forms of property in Catalonia

The day August 24, 2015 came into force in Catalonia Law 19/2015, regulating two new forms of ownership: temporary ownership and shared ownership ...

While these forms of property are designed for real estate based in Catalonia, its regulation may also extend to movables durable and non-expendable they can register in Catalonia.

The purpose of this Act is to provide solutions to the problem of access to housing, easing the process of acquiring it and offering formulas to lessen the economic costs.

So far, the instruments that consumers were in the real estate market was the acquisition of real right of ultimate ownership by the purchase agreement and the acquisition of the right of use and enjoyment of the property by lease, with or without an option shopping. These forms have been the most considered despite the existence of other less common legal responses, as would the census, the right of usufruct and surface rights.

Like all real rights, acquisition of temporary ownership or shared ownership will be subject of registration in the Land Registry or corresponding record, being possible to set up a shared ownership of an asset under temporary ownership.

TEMPORARY PROPERTY

In the temporary property, the owner has, for a fixed term, identical to ordinary owner entitling her to act as sole and exclusive owner of legal power.

Once the deadline expires, the well becomes full ownership of the successive owner, whether original or it has acquired this, who can take direct possession of the property.

The minimum term of this type of property is set at a minimum of ten years for real estate and a maximum of ninety-nine.

The temporary property can sell, mortgage and submit any other encumbrance to the limit before the deadline. For its part, the subsequent holder may sell, mortgage and any other liens subject to their right.

It is also possible a pact between the landlord and the tenant, so that this, once they reach a certain duration of the lease, can become a temporary owner.

SHARED PROPERTY

Shared ownership confers on one of the two owners, who called proprietary material, an initial fee for the domain, the exclusive use of the property and the right to acquire, gradually, the remaining quota of another holder, who receives the formal name owner. This legal situation is, in any case, the exclusion of action division.

The duration of shared ownership is thirty years, unless the parties set a different time and in no case can exceed ninety-nine years.

The material and the formal owner can sell and mortgage their share. Alienation for consideration of that quota granted to the other, unless otherwise has been agreed, rights of first refusal and redemption.

Material fee owner is affected, with real character, the payment of the consideration for the current year and the immediately preceding two years.

The enforcement of any installment does not extinguish shared ownership, so the bidder is subrogated to the rights and obligations.

TAXATION

The tax rules have not changed with the introduction of these new forms of ownership. In particular, regulation of tax on capital transfers and documented legal acts (ITPAJD) as well as the value added tax (VAT) shall continue to apply as they are currently regulated.

For its part, the Government Administration must negotiate with local governments to, among other things, meliorate the property tax (IBI) of housing in temporary ownership or shared ownership, and reduce or reclaim tax buildings and works and rates of the rehabilitation and adaptation of said housing.

FORECLOSURE

Similarly, governments must negotiate with credit institutions to homes in foreclosure process is transformed into a temporary or shared ownership taking into account the amounts amortized by the acquirer.

Moisés Murcia Priego 
Lawyer specializing in Business Law, SF Lawyers