Bare Ownership of a Home: Complete Guide 2026

The bare ownership of a home is a legal and financial concept that has gained relevance in the Spanish real estate market. In times when investment alternatives are increasingly varied and the search for asset security becomes essential, understanding this type of property is indispensable. Let's see what it's all about.

What is bare ownership?

Bare ownership is a legal concept that refers to the separation of property rights for a real estate asset. In simple terms, it means that one person (the bare owner) holds the title to the property, but does not have the right to use or enjoy it, as another individual (the usufructuary) holds that right. The usufruct can be lifelong, typically granted to a person who, for personal or family reasons, needs to retain the use of the home for a specific period. In this sense, bare ownership is commonly used as a means of financing, estate planning, and asset protection.

How is it acquired? 

Acquiring bare ownership of a home involves purchasing this portion of the real estate asset, while the usufruct is granted to a third party, typically the seller or a family member. This transaction is usually formalized through a purchase agreement, which must be notarized and registered in the corresponding Property Registry. It is important to highlight that this operation can be carried out by agreement between the parties, seeking to establish conditions that protect both interests.

Advantages of bare ownership

Benefits tax and asset-related

Bare ownership offers several advantages that attract investors interested in maximizing their returns through these types of transactions.

Transfer of assets

This legal concept facilitates the transfer of ownership of an asset to another person or entity, which is particularly useful in inheritance contexts or succession. This ensures that the property remains in the hands of family members or specific individuals.

Tax burden

Regarding taxation, the usufructuary is responsible for including the bare ownership in their income tax return, exempting the bare owner from this requirement. This means there are no Personal Income Tax (IRPF) implications for the bare owner.

Flexibility in management

The bare owner has the freedom to sell, mortgage or donate the property without the usufructuary's consent. This ability is particularly valuable in situations where financing is required or modifications to the property are desired.

Investment in bare ownership

Bare ownership can be considered a form of investment, allowing investors to acquire it and transfer the usufruct to another person or entity. This way, an additional income stream will be generated for the investor, while the usufructuary can enjoy the use of the asset for a stipulated period.

What rights does the bare owner have?

Right of ownership

The bare owner owns the property, although they do not have the right to use and enjoy it.

Right to sell bare ownership

They can sell the bare ownership to a third party, provided that the usufructuary's rights are respected.  

Right to mortgage bare ownership

A mortgage loan can be requested on the bare ownership of the usufructed property. If, upon termination of the usufruct, full ownership is consolidated in the bare owner who mortgaged it, the mortgage will also extend to the usufruct, unless otherwise agreed.   

Right to carry out works and improvements

Works and improvements may be carried out on the property over which bare ownership is held, as long as it does not harm the usufructuary. 

Right to have the use and enjoyment of the property restored when its usufruct has terminated

Upon termination of the usufruct, the usufructed property shall be returned to the owner, except for the right of retention held by the usufructuary or their heirs for expenses that must be reimbursed. Once delivery is verified, the bond or mortgage will be cancelled.

Bare owner's responsibilities regarding the property

The bare owner's responsibilities or obligations are as follows:

• To be responsible for extraordinary repairs to the asset, in this case, the property: extraordinary repairs shall be borne by the owner. "The usufructuary is obliged to notify the owner when there is an urgent need to carry them out," the article explains. 
• Respect the usufructuary's right: according to Article 489 of the Civil Code, the bare owner "may not alter the characteristics of the usufructed property, nor perform acts that harm the usufructuary's right."
• Payment of taxes and duties related to the usufruct: the bare owner is obliged to pay the taxes and duties corresponding to the property, with the exception of the Property Tax, which shall be borne by the usufructuary. 
• Pay the mortgage on the usufructed property: Article 59 of the Civil Code states that the usufructuary of a mortgaged property "shall not be obliged to pay the debts for which the mortgage was established" and, if the property is seized or sold judicially to pay the debt, "the owner shall compensate the usufructuary for any loss incurred for this reason."
• Be accountable to the usufructuary: the bare owner will be liable to the usufructuary if the property is seized or sold to satisfy a debt.
• Taking responsibility for community fees: The Supreme Court, in a May 2005 ruling, states that “it constitutes an obligation imposed not on the users of a property, but on its owners.”

Disadvantages of bare ownership

Despite its numerous advantages, bare ownership also has significant drawbacks. Let's look at them:

Loss of the right of use

Bare ownership involves ceding the usufruct to another person, meaning the bare owner cannot use or enjoy the asset. If you wish to live in the property, this option is not advisable.

Responsibilities of the bare owner

Although the usufructuary is responsible for the care and use of the asset, the bare owner must still assume legal responsibility for the property, including the payment of taxes, repairs, and other related expenses.

Duration of the usufruct

The usufruct can be temporary or lifelong. It terminates upon the death of the usufructuary, and many investors consider this type of acquisition with long-term benefits in mind.

Reduction in property value

When purchasing at a price below market value, the asset's value may also decrease during the usufruct period, which is an important consideration.

Risk of non-payment

There is a risk that the usufructuary may not fulfill their payment obligations or adequately maintain the property. Bad faith actions can result in damages that negatively impact the property's value and future profitability.

Can the bare owner live in the property?

No, the bare owner cannot live in the property until the usufruct is extinguished. The essence of this legal arrangement is precisely the separation of rights; therefore, the bare owner must wait for the usufructuary to vacate the property, whether due to expiration, death, or mutual agreement, to fully exercise their rights over the asset.

When is it lost? 

Bare ownership is not "lost" in the conventional sense, but it can be affected by circumstances such as the usufructuary waiving their right, the death of the usufructuary (in the case of a lifelong usufruct), or by certain specific conditions stipulated in the contract that govern the relationship between the bare owner and the usufructuary. It is important to note that if the usufructuary fails to comply with the terms of the usufruct, legal issues may arise that affect the stability of the relationship between both parties.

Can the bare ownership of a house be sold?

• Sale of bare ownership: yes, it is possible to sell the bare ownership of a house, as the bare owner has the right to do so, although this sale is conditioned by the existence of a usufruct.
• Buyer's Rights: the new buyer becomes the bare owner and accepts the same associated rights and restrictions inherent to the position, which can influence the attractiveness of the transaction from an economic point of view.
• Liquidity for Retirement: many owners choose to sell the bare ownership as a way to obtain liquidity for their retirement, allowing the property rights to be separated without giving up the usufruct.
• Retain Usufruct: it is possible to sell the bare ownership without giving up the usufruct, which has gained popularity, especially among owners over 65 years who are looking for liquidity while continuing to reside in their home.

What are the requirements?

To carry out the sale of the bare ownership of a property, the bare owner must comply with certain legal requirements that ensure the validity of the process. Firstly, it is essential that all documentation for the property is in order, which includes the presentation of property titles and the certificate of encumbrances, among other documents. Furthermore, although not always an indispensable requirement, it is highly advisable to have the usufructuary's authorization, as reaching an agreement between both parties can prevent future conflicts and misunderstandings regarding the sale. Finally, it is essential to formalize the transaction by means of a public deed, as this step not only legitimizes the transaction but also ensures that the sale is carried out in accordance with current legal provisions. 

How is the sale calculated? 

The price of bare ownership is usually calculated by considering several factors, such as the market value of the property, the age and health status of the usufructuary (in the case of a life usufruct), and the expected duration of this right. There are tables and coefficients that allow for estimating the value of bare ownership based on the usufructuary's longevity and the classification of patrimonial rights.

How is the sale of bare ownership taxed for personal income tax (IRPF)?

The sale of bare ownership is considered a capital gain and, therefore, is subject to personal income tax (IRPF). The gain is calculated as the difference between the sale price and the acquisition price. It is important to note that this taxation may vary depending on whether the seller has met the holding period and the deductions that may apply.

What happens if I buy bare ownership of a property?

Buying bare ownership of a property means that you acquire the long-term ownership right to the asset, assuming you will not have access to or use of it until the usufruct expires. This can be a very attractive option if you are looking for a long-term investment or want to secure a future inheritance, although it is crucial to be aware of the associated risk of acquiring a property without being able to enjoy it.

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Conclusion

Bare ownership of a home is a significant alternative in the real estate sector, offering multiple benefits and advantages for both the seller and the buyer. However, it entails several legal and tax considerations that require careful study. For those looking to invest in real estate or plan their estate, understanding the dynamics of bare ownership is essential for making informed and strategic decisions.