When we talk about leasing, we commonly refer to a lease that offers the possibility of enjoying the property (or other property), paying a periodic rent, and redeeming the property at the end of the agreed duration. The figure for the redemption is agreed upon signing the contract. In the end, those who use the property can decide to return it or become its owner against payment of the difference between the amount already paid and the value of the property. In property finance this is a very important deal now.

It is therefore a form of investment used to buy or renovate new or used properties. Due to its flexibility, which makes it easier to adapt to customer needs, it is the most used especially by real estate companies instead of the mortgage.

The Positive Aspect

• Several positive aspects of this investment: the amortization of the fees takes place in a period between 96 and 240 months, an initial installment is granted ranging between 10% and 30%.
• The choice for leasing is made based on the availability of initial liquidity and a correct balance between rates and amortization. Naturally the higher the initial installment the more the rates in the monthly rents and the value of the final amount will be convenient.
• From a fiscal point of view leasing offers advantages to companies. It makes it possible to amortize the property purchased in the period between eight and nine years against the amortization in thirty years in ordinary loans such as mortgages. Another positive aspect is the possibility to fully deduct the fees if they are amortized for at least eight years.

For self-employed or private workers convenience is reduced. They can deduct from the total income only the cadastral value of the asset. If the property is for residential use, the deduction is applied only for half of the total amount.

The Aiming of the Loans

• This loan is aimed at the purchase of new or used buildings, finished or under construction as long as they are not intended for residential use. Therefore, they must be strictly for commercial, industrial or professional use.
• If the building is already built, the Leasing allows you to buy it quickly and with immediate fiscal effect through, with the payment of the public deed of sale (deed).
• Leasing can have both fixed and variable rates. The duration is at least 18 years. The periodicity and the value of the fee are variable. However, redemption is usually between 1% and 30%.
• The function is to allow the use of the property, which is generally long-term, without the obligation to purchase, but with the right to redeem it at the end of the contract by following the conditions established at the time of its conclusion.

This form of financing has had a great impact in Italy. The reasons for success are different, including full funding coverage, low interest rates, delivery speed and flexibility. Compared to the mortgage, real estate leasing offers various advantages such as the possibility of adapting the characteristics of the lease to your needs.