Access to housing remains one of the most discussed challenges in Spain. The rent-to-own model offers a practical solution to simplify the path to homeownership. However, high property prices continue to pose a significant barrier, even for subsidized or affordable housing.
In this article, we’ll explore how the rent-to-own system works in Estepona, how it connects with the new government grant introduced under the 2026–2030 State Housing Plan, and the key points you should know about this program.
What Does “Rent-to-Own” Mean?
Buying a property in Spain through traditional means isn’t always easy. However, there are certain types of contracts that make the process more flexible and accessible, and the rent-to-own agreement is one of them.
This hybrid model is based on a dual-purpose contract that combines a rental agreement with the exclusive right to purchase the property later on.
In other words, a rent-to-own agreement gives tenants the exclusive right to buy the home once the rental term ends, or even earlier if they wish. In this sense, it works similarly to a home reservation contract.
This arrangement allows individuals to stabilize their financial situation and ensure the property truly meets their needs before committing to a purchase. In many cases, part of the rent paid can be deducted from the final sale price, making home-ownership more attainable.
For property owners, rent-to-own contracts represent a secure path toward a future sale while still generating rental income in the meantime.
👉 Looking for a change of scenery? You may be interested in our guide on what to do to sell your house in Estepona.
How Does Rent to Own Work?
The effectiveness of a rent-to-own agreement largely depends on how well the contract is structured. While every case is unique, there are several key aspects typically defined when drafting a rent-to-own contract:
Duration and Terms of the Agreement
In most cases, these contracts have a duration of 2 to 5 years, although the parties may agree on a different period.
Generally, the purchase option can be exercised at any time during the agreed term. However, some contracts only allow the purchase once the rental period has ended.
In any case, the agreement must specify a deadline by which the tenant can exercise their right to buy the property. Once that date passes, the tenant’s exclusive right expires.
Monthly Payments, Advance Credits, and Discounts
One of the main advantages of a rent-to-own contract is that a percentage of the rent paid is deducted from the final purchase price of the property. The exact amount or percentage to be deducted is specified in the contract: it may be fixed or adjusted according to the Consumer Price Index (CPI).
Additionally, rent-to-own agreements typically include an initial premium that secures the tenant’s exclusive right to purchase the property. This premium is usually paid at the beginning of the contract and represents around 5–10% of the property’s price. It serves as a form of guarantee for the landlord, and may be forfeited if the tenant decides not to buy the property later on.
Risks, Guarantees, and Penalties
No contract is without potential complications. For that reason, rent-to-own agreements should include clear clauses that define what happens in adverse situations, such as breach of contract, property devaluation, or loss of the purchase option.
To protect both parties and minimize risks, the agreement must be drafted carefully, ideally including early termination and compensation clauses. Consulting a specialized real estate lawyer (or a real estate agency that includes this service) is essential to ensure proper legal protection.
👉 Want to learn more about this type of contractual obligation? Don’t miss our article on the “contrato de arras” (deposit contract) and its role in Spanish property transactions.
€30,000 Government Grant for Young Rent-to-Own Buyers
A new national grant has recently been announced to help young people access housing more easily. This initiative is part of Spain’s 2026–2030 State Housing Plan, and it has sparked debate both within the government and in the media.
What the Regulation Says
Under the 2026–2030 State Housing Plan, young buyers may receive up to €30,000 in financial assistance when entering into a rent-to-own agreement. The measure aims not only to simplify access to homeownership but also to improve liquidity for developers and owners of subsidized housing.
According to the proposal, when purchasing a property previously rented under a rent-to-own contract, the State would cover an amount equivalent to the rent already paid, up to a maximum of €28,800. This subsidy is paid directly to the seller, effectively reducing the property’s final purchase price.
Requirements and Conditions
To qualify for this benefit, applicants must meet several conditions:
- Tenants must be Spanish citizens under the age of 35 and must not own another property.
- The home must be a permanently protected property (VPO).
- Monthly rent payments must be allocated toward the purchase option.
- The rental agreement must clearly specify the final purchase price.
- The purchase must be exercised within three years from the start of the rental contract.
- Sellers are required to declare the subsidy as taxable income under Spanish tax law (IRPF).
Impact and Opportunities in Estepona
This grant may be applied to rent-to-own properties in Estepona, as long as they are officially protected (VPO). The municipality already offers several affordable housing projects, and once the regulation is enacted, the subsidy could help facilitate the purchase of these homes.
However, priority is often given to residents registered in Estepona, which may limit eligibility. Moreover, if the supply of VPO homes doesn’t increase, demand could soon exceed availability — creating competitive pressure in the local market.
👉 You might also be interested in our guide to buying a house in Estepona.
Advantages and Disadvantages of Rent to Own
The rent-to-own system offers clear benefits, but it also comes with certain risks that should be carefully evaluated before signing an agreement.
Key advantages of this system include:
- Gradual access to homeownership. Tenants can live in the property from day one while working toward eventual ownership.
- Reduced upfront financial pressure. Rent-to-own agreements allow tenants to build up part of the purchase capital during the rental period.
- Flexibility. Tenants have time to assess whether the property (and the area) truly meets their expectations before committing to buy.
- Profitability for owners. Landlords benefit from ongoing rental income while securing the possibility of a future sale (or, at the very least, the initial premium).
On the other hand, its main disadvantages are:
- Risk of non-purchase. If the tenant ultimately decides not to buy, any payments or premiums already made may be lost, unless otherwise stated in the contract.
- Double taxation. These agreements can be subject to both rental and purchase taxes, which can be inconvenient if the purchase is never completed.
- Penalties. May apply in cases of non-payment or if the purchase isn’t executed within the agreed timeframe.
- Uncertainty in property value. Rent-to-own contracts typically lock in a fixed sale price. This benefits the tenant if prices rise, but not if the market value drops.
👉 Still unsure whether a rent-to-own property on the Costa del Sol is the right move for you? Get expert advice from a trusted real estate agency in Estepona, like Cabanillas Real Estate.
Rent-to-Own Contracts: Key Legal Aspects
Renting a home in Estepona with an option to buy has its own particularities. When negotiating a contract, there are several key legal points to keep in mind.
Essential Clauses
The contract must include a series of specific clauses written clearly and unambiguously. It’s always advisable to seek professional advice to ensure the agreement fits your needs. In most cases, the following clauses are essential:
- Agreed price. The price at which the property will be sold. If not fixed, the mechanism for determining it must be stated.
- Discounts. The percentage of rent that will be applied toward the purchase price or as part of the premium.
- Initial premium. The agreed amount and payment conditions must be specified.
- Duration of the contract. This includes both the rental period and the deadline for exercising the purchase option.
- Purchase conditions. How the payment will be made, within what time frame, and which party is responsible for each obligation.
- Irrevocable option. The purchase option must remain valid throughout the contract period.
- Registration of the option. Beyond stating the irrevocable right, registering the tenant’s purchase option with the Land Registry adds an extra layer of legal protection.
- Guarantees and breach clauses. The amount of deposit or guarantee, and the penalties to be applied in the event of non-compliance by either party.
Local Regulations and Specifics in Estepona
When entering into a rent-to-own agreement in Estepona, it’s crucial to consider both the local tax framework and the legal implications. While contracts are governed by the Spanish Civil Code, taxes related to rental and property purchase are managed by the autonomous community of Andalusia.
Generally, rental income is taxable and must be reported to the tax authorities. The Urban Leasing Act (LAU) regulates aspects such as rent increases, minimum contract duration, and renewal terms.
For purchases, in Andalusia, the Leasing Act distinguishes between new properties purchased directly from developers (which are subject to 10% VAT) and resale properties (which are subject to the Property Transfer Tax (ITP), currently set at 7%).
Additionally, in Estepona, the sale is also subject to the municipal capital gains tax (IIVTNU). Local ordinances regulate deductions and deadlines for this tax.
For more details, we recommend reading our guide on what to know before a long-term rental on the Costa del Sol.
The Role of the Real Estate Agency
Drafting and managing a rent-to-own agreement can be complex, especially if you want to ensure both parties are protected and that the process remains fair and transparent.
Working with a real estate agency in Estepona is key to ensuring the success of this type of transaction. A qualified agency can:
- Draft the contract, including personalized clauses.
- Negotiate the financial conditions between both parties.
- Verify the property’s legal status and check the buyer’s solvency.
- Coordinate the registration of the purchase option.
- Oversee deadlines and compliance throughout the process.
Additionally, partnering with a real estate agency can provide access to specialized advice on local and regional regulations, minimizing risks and streamlining the transaction. This guarantees that every clause complies fully with Andalusian and municipal legislation.
Rent-to-Own Properties in Estepona
The Costa del Sol remains one of Spain’s most dynamic real estate markets, and Estepona is no exception. The town currently offers a wide selection of rent-to-own properties, including:
- Apartments
- Villas
- Townhouses
- Holiday homes
Rental prices for rent-to-own properties in Estepona typically start at around €2,600 per month, depending on the location, size, and type of property.
Working with a local real estate agency gives you access to a broader range of listings, helps you negotiate better terms, and (most importantly) ensures full transparency throughout the entire process.
👉 Find your place in the world with our guide to the best areas to live in Estepona.
The State Housing Plan: Beyond Subsidized Housing
In addition to the €30,000 grant available for rent-to-own agreements involving subsidized properties (VPO), Spain’s 2026–2030 State Housing Plan introduces a series of broader measures. These initiatives also apply to non-subsidized homes, with the goal of making both renting and buying more accessible.
Some of these measures include:
- Rehabilitation of existing housing stock. Vacant homes that are refurbished for social or affordable rental (for a minimum of five years) may qualify for grants of up to €20,000.
- Aid for young buyers (non-VPO). The plan includes financial assistance for the purchase or rental of a primary residence in towns with fewer than 10,000 inhabitants, for individuals under the age of 35.
- Financial effort control. The new regulations aim to ensure that housing costs do not exceed 30% of household income, helping maintain financial stability for families.
- High-demand market areas. The plan seeks to contain both rental and sale prices in so-called “stressed” market zones, while promoting industrialized construction to increase housing supply in those areas.
Overall, these initiatives are designed to make adequate housing more accessible for younger populations and individuals with limited resources, whether they live in high-demand urban areas or in low-density rural regions.
Frequently Asked Questions About Rent to Own in Estepona
How does a rent-to-own agreement work?
A rent-to-own contract functions as a dual agreement. On one hand, it establishes the terms and conditions of the property rental; on the other, it grants the tenant the exclusive right to purchase the property at an agreed price within a specific period of time.
If stipulated in the rental contract, a portion of the monthly rent can be credited toward the purchase price, meaning that when the sale takes place, that amount is deducted from the final price of the property.
When can I exercise the purchase option?
This depends on the agreement reached with the property owner. In some cases, the purchase can be made at any time during the contract period; in others, it can only be executed once the rental term has ended.
What happens if I decide not to buy the property at the end of the contract?
If you choose not to buy the property after the contract expires, you lose your exclusive right to purchase it later. In addition, you generally won’t recover the initial premium or the rent payments made, unless otherwise stated in the agreement.
Can I apply for the €30,000 government grant for a rent-to-own property in Estepona?
You can apply for the €30,000 grant to rent a property in Estepona under a rent-to-own agreement. However, you must meet all the legal requirements regarding age, citizenship, and property ownership, and the home must be an officially protected property (VPO).
What guarantees should a tenant-buyer request?
Before entering into a rent-to-own agreement, make sure to verify the following guarantees:
- Property legality. Confirm that the property is correctly registered in the Land Registry and free of encumbrances.
- Agreed purchase price. The price must be clearly established from the start and recorded in writing.
- Purchase conditions. Review the timelines, the percentage of rent that will be deducted from the final price, and all relevant clauses.
- Irrevocable option. Ensure the seller cannot withdraw the purchase option during the agreed period.
To further protect your rights, you can register the purchase option in the Land Registry. Alternatively, working with a local real estate agency can help ensure transparency and legal compliance throughout the process.
Why is it important to work with a local real estate agency in Estepona?
Partnering with a local real estate agency when entering a rent-to-own agreement in Estepona ensures that the process is clear, transparent, and legally sound. Local professionals understand Andalusian and municipal regulations, helping both parties remain protected and ensuring that the contract meets all legal requirements.
Finding Your Home on the Costa del Sol
The rent-to-own model is an ideal option for those who wish to purchase a home but prefer not to make a large initial investment, or who simply want to ensure the property meets their expectations before committing to buy.
This system makes access to homeownership more achievable. However, the process itself can be anything but simple. It’s essential to carefully draft timelines, clauses, and legal guarantees to avoid financial losses or limitations on your purchase rights.
You should also ensure full compliance with regional regulations and verify that the property is legally sound before signing. Partnering with a real estate agency in Estepona will help streamline the process, ensuring both transparency and legal security every step of the way.
Are you looking to rent with an option to buy in Marbella or Estepona? Get in touch with Cabanillas Real Estate for expert guidance on rent-to-own agreements and property transactions on the Costa del Sol.
The moment to step into your new home starts now.
Si tienes consultas puedes contactar en sales@cabanillasrealestate.com
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