Renting housing with a buyout option: under what conditions does the property transfer ownership
Renting housing with a buyout option involves the transfer by a legal entity to an individual of property rights to an unfinished construction object or finished housing for a term of up to 30 years.
As reported by the Main Department of the State Tax Service in the Kharkiv region, according to the Tax Code of Ukraine, renting housing with a buyout option involves the transfer by the legal entity-lessor to an individual of property rights to an unfinished construction object and/or finished housing based on the relevant contract.
Such a contract is concluded for a long term — up to 30 years. After full payment of rent, and in the absence of other encumbrances or restrictions on the housing, the property transfers to the tenant’s ownership. Ownership rights can be formalized either after the contract term ends or earlier if all financial obligations are fulfilled.
The State Tax Service also noted that the rent-to-own contract may provide for the assignment of the right to claim payments under such a contract.
As previously written by the "Judicial and Legal Newspaper", rules in the housing policy sphere in Ukraine are changing. As is known, President Volodymyr Zelensky signed the Law "On the Basic Principles of Housing Policy" No. 4751-IX. The document cancels the 1983 Housing Code and the law on the privatization of the state housing stock, completely updating the approach to management, rental, and acquisition of housing.
One of the new mechanisms is renting housing with the right to buy. This is housing that can be obtained in ownership after ten years of rent.
Ukrainians who have lived in housing from the state or communal stock for more than 10 years have gained the opportunity to conclude a rent-to-own contract. This concerns not social housing but ordinary properties. It is important that such a purchase is made only at market price — a lower price is not allowed. Funds received from rent-to-own are directed exclusively to a special revolving fund.
Subscribe to our Telegram channel t.me/sudua and to Google News SUD.UA, as well as to our VIBER page on Facebook and on Instagram to stay informed about the most important events.
