Renting as a Method of Saving to Buy: The New Housing Model Aiming to Succeed Among Young People in Alicante

Rent-to-own. This is the latest housing model that has just landed in Alicante, a city where both rent and property prices have soared in recent years, reaching peaks in May, according to Idealista data. In fact, the price per square metre already exceeds 3,000 euros in several neighbourhoods of the city and rent has broken the 1,000 euros per month barrier in most areas.

This reality further complicates access to housing for young people in the process of becoming independent. With salaries that rarely exceed 1,500 euros net per month, the ability to save is sometimes reduced to below 300 euros monthly. At this rate, they would need more than a decade of saving without expenses to buy a home. It is a paradox, as not being able to access home ownership forces them to rent, which in turn prevents them from saving to acquire a property.

In this context, the startup Libeen arrives in Alicante, following its success in Valencia and Madrid, with its innovative 'SmartHousing' system, where houses are rented with an option to buy, facilitating tenants' savings so they can purchase them. The company states that "with them, young people can become homeowners in just three years".

The trick lies in the fact that the startup itself buys the property 100%. To rent it, a 5% deposit is required, instead of the 20% demanded by financial institutions for a mortgage. The deposit would be around 18,000 euros, while, according to the latest Idealista data, mortgage deposits in Alicante rise above 57,000 euros. After this, the startup charges monthly fees of 1,250 euros, of which the tenant saves 30% as savings that will eventually be used for the acquisition of the property.

The company has announced an investment of 10 million euros to acquire these 50 homes, starting from prices of 200,000 euros. To achieve this, they have secured agreements with local real estate agencies to capture opportunities. Thus, it is expected that in this first phase, it will help about 150 young people.

The founder and CEO of Libeen, José Manuel Cartes, explains that "currently, young people throw away 50% of their income on rent, and Libeen aims to change this by allowing people to use the rent amount to buy their home, turning it from an expense into savings". The idea is based on setting a 5% deposit and allocating part of the rent to the final purchase of the property, a period that would stretch up to three years, according to the company.

This system has certain requirements. The first is to be between 18 and 40 years old and to have a monthly income of 2,500 euros among the people buying the home. A prior saving of at least 18,000 euros is also needed, and only homes starting from 200,000 euros will be considered.

"Libeen is an option designed for solvent young people with some savings who cannot enter the traditional mortgage market but want to take the step towards ownership," details Cartes. The startup's founder assures that "from the first monthly payment, which is around 1,250 euros, a favourable financial history begins to be built to close the purchase in a few years".

The company's idea, born in 2020 and with a 2024 investment of 25 million euros led by Anbank and the German fund Cusp Capital, is to reach 12 Spanish cities in the next two months, especially after the success in Madrid and Valencia.