Faced with rising demand for social housing due to rising house prices, the three year residency was introduced to alleviate the issue in the early 1990s. This created a two tier market; ‘Open Market’ (which can be purchased by anyone of any nationality, residency or purpose) and ‘Restricted Market’ (subject to the residency restrictions).
There are different types of three year residency properties and each development has varying restrictive covenants on the leases as to how long the residency restrictions apply for, how long leaseholders have to own them before they can sell them amongst others, but one thing they all have in common is that they cannot be used for profit and so they cannot be let out on the private rental market and must remain owner occupied. On newer affordable housing developmentsthere are additional restrictions on selling within a set period of time from the initial purchase and possible share in profit gains.
Many of these purpose built developments from the 1980s / 1990s were offered on a ‘shared ownership’ basis (know locally as a 50:50) where the leaseholder initially buys 50% of the property. They can subsequently buy further shares at market rate. There is no rent payable on the share they DON’T own, although the incentive to buy the remaining share as quickly as possible exists by way of the market valuations increasing over the years. Examples of these would include Montagu Gardens and Harbour Views in Westside.
To make things even more complicated, much of the ex MoD stock properties sold at tender in recent years have different residency restrictions for longer periods, although have a much shorter time-span before this restriction is lifted. Examples of these types include Europa Walks and The Ramps in South District.
Restricted Market properties are available to qualifying British citizens whether they be Gibraltarian born or UK born, so long as they can evidence a continuous, unbroken period of residing in Gibraltar immediately preceding their purchase. It can be possible for other nationalities to qualify under certain circumstances. Please consult a local solicitor for advice on this.
At Richardsons we have almost 40 years experience dealing with Restricted Market properties. We can also put you in contact with a panel of solicitors who specialise in Restricted Market properties if you wish to explore this option further.
For further information on the Restricted Market or to see if you would qualify, call one of our Sales Team today on +350 200 79210 or email us on info@richardsons.gi.