Full ownership and right of residence

Full ownership, usufruct, bare ownership, right of habitation. 

They are different and not coinciding concepts, but interconnected and share some characteristics. For this reason they need to be precisely specified.

Full ownership: what is meant

The most common type of property, the one we usually think of, is the full property. Also known as "perfect ownership", this is the right governed by art. 832 c.c. That allows the owner to enjoy and dispose of the property in a full and exclusive manner, within the limits and with compliance with the obligations established by the legal system.

If he is interested in the property then it will be full and entire ownership and the owner will be able to use the property as he sees fit, as he pleases, and exclude anyone else from enjoying it.

Furthermore, the owner is allowed to exchange or sell the asset, as well as create minor real rights in favor of other subjects. In this case, there will be a "compression" of the property right, or a limitation of the owner's faculties, but following the extinction of these minor rights, the property right will once again acquire its entirety.

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Bare ownership: what is meant

For this reason, different from the concept of full ownership is that of "naked property" That emerges when we talk about usufruct, or that real right therefore a person (called usufructuary) has the right to enjoy the real estate, respecting its economic destination, being able to derive any benefit from it, without prejudice to the limits established by the civil code.

Usufruct, therefore, coexists with ownership, but the usufructuary essentially has the right to exercise a power over the asset that is very close to that of the full owner. In addition to using the asset directly, he will also be able to receive all the profits that it is able to generate, including civil or natural fruits.

It is precisely the wide range of faculties enjoyed by the usufructuary that has made the use of the right of usufruct very widespread in practice. The "naked owner", who sees his right emptied, is left with the expectation of seeing it re-expand.

The usufruct, in fact, has a temporary nature and its duration cannot exceed the lifespan of the usufructuary. This means that, once the usufruct has expired, bare ownership is destined to become full ownership.

The expectation of future full ownership is one of the elements that gives bare ownership a value, a position that can be sold and purchased at a price that is normally lower than that of full ownership of the asset.

 Right of residence: what is meant

Also the right Of home, like usufruct, coexists with the right of ownership, but the "contraction" that occurs is certainly less incisive and therefore we cannot speak of bare ownership, a concept that remains reserved for the co-presence of ownership and usufruct on the same asset.

The civil code, in art. 1022, describes the dright of residence such as that relating to a house, therefore on a property used for residential purposes, and which takes shape in living there limited to the needs of themselves and their family.

the right enjoyed by the owner is different and limited compared to that of the usufructuary, both in terms of object and power of enjoyment. The object of the right of residence can only be a house and the owner will have no right to the fruits. The owner will only be able to enjoy the property limited to his own and his family's housing needs, even if only a portion of it, thus allowing the owner to continue using the remaining portion of the house.

Since this is a highly personalistic real right, characterized by "intuitus personae", and therefore the owner will only be able to enjoy it personally and directly. The art. 1024 c.c. in fact, it provides that "the right of residence cannot be sold or rented".

 Usufruct or home? 

Giving an asset in usufruct or granting you the right of residence therefore has very different consequences. In the first case, i.e. in the case of usufruct, the owner could rent the asset to third parties and receive the fees, therefore the owner will not be certain that that asset remains in the actual availability of the usufructuary.

What happens differently is the right of residence which appears to be more "controllable". As highlighted, this is a right of a strictly personal nature which allows the habitator and family members to derive only an advantage related to habitability, or to staying in the property.

However, in a situation of uncertainty in the financial markets, it is worth remembering how bare ownership is becoming a preferable purchase option for many who choose to invest long-term in the real estate market, perhaps for future generations. Furthermore, usufruct is chosen by those who want to continue living in their home as usufructuaries, but ensuring that in the future, upon their death, a relative (e.g. children) becomes the owner of the property.

In conclusion, the choice is strongly influenced by the interests at stake and the needs of the parties.