⁠   ⁠

What is real estate leasing and How to Make the Best of It?

30% of national real estate transactions in 2022 were made through leasing.

In Mexico, 16.4% of the population are tenants in rental properties.

Real estate leasing is a growing trend that involves renting a property under an acquisition agreement, meaning that part of the monthly payments will cover the total cost, or that the sale will be finalized at the end of the agreed term. This alternative has become quite common among young people or those who cannot access a mortgage. According to the latest data from the National Institute of Statistics and Geography (INEGI) in 2022, 30% of real estate transactions in the country were rental agreements with an option to buy.

Although only 16.4% of the population in Mexico lives in rented homes, each year thousands of people apply for financing to purchase a home. In 2023 alone, 746,539 applications were registered, according to the National Housing Information and Indicators System (SNIIV). This figure clearly reflects the interest in transitioning from tenant to homeowner, despite the rising property prices and challenges in securing a mortgage. This is why leasing has gained popularity, as it offers a flexible option.

If you’re thinking of acquiring a home but don’t have a credit history, work informally, or don’t have enough resources to pay upfront, this could be a solution for you. Here are five tips to consider if you plan to use leasing:

• Find out if you need to make a down payment: Most real estate transactions require an advance payment, but since this option is designed for people who can’t afford a down payment, it’s rare for sellers to ask for one. This will depend on the seller and the terms of the agreement, so it’s best to confirm whether a down payment is required to avoid surprises.

• Set the terms of the agreement: There are different types of contracts. For example, you can rent for a certain period and then finalize the purchase. The owner might also ask for a mortgage, which would be paid with your monthly payments. Regardless of the agreement type, make sure everything is clear before signing. Remember that the final price should be established upfront. Don’t forget to ask for a copy of the document.

• Ensure you can cover the payments: Based on the agreement, in most cases at least 30% of the rent will go toward covering the total cost, which means these payments may be higher than a regular rent. It’s very important to consider that this will be a recurring expense for at least 10 years, so you need to evaluate your financial capacity, especially if you work informally. Consider finding additional income to strengthen your finances.

• Hire a lawyer: When you seek to acquire a property through leasing, you will sign a dual contract—one for the lease terms and another for the acquisition. These documents include personal information from both parties, so it’s advisable to hire a lawyer to guide you throughout the process. This will also ensure that everything is 100% legal.

• Choose carefully: Cost isn’t the only factor to consider when choosing your future home. There are other important aspects to take into account. While most people go for the cheapest option, they may overlook factors such as the property’s condition, the area where it’s located, or the age of the building. Compare your options and take your time to decide to avoid future regrets.

Before opting for this solution, you should be certain that you want to complete the deal, as if you decide to interrupt or abandon the process at any point, you will lose your investment. Therefore, we recommend consulting with an advisor who can explain how the process works in detail, so you can decide if this is the best option for you.

Guía rápida para Comprar Inmuebles en CDMX

Coldwell Banker México: coldwellbanker.com.mx

https://www.inegi.org.mx/contenidos/saladeprensa/aproposito/2023/EAP_Vivienda.pdf

https://sniiv.sedatu.gob.mx/Dashboard/Demanda

https://www.bbva.es/finanzas-vistazo/ae/financiacion/que-es-el-leasing.html

https://www.flat.mx/elliving/compra-tu-casa-pagando-renta

https://blog.yave.mx/renta-con-opcion-a-compra