Why choose life annuity sales?
The life annuity mechanism is a relatively simple mechanism to understand is the fact of selling a property (or buying it) but paying the sale price, not at the time of the transaction, but by monthly payment throughout the life of the seller. By selling life annuities, the seller will benefit, throughout his life, from an additional income, allowing him to complete his retirement. More informations : https://www.label-properties.com/en/ .In a more common formula and more sought after by sellers, the owner sells his building but retains the right to live on it (beware, the right to live is not a usufruct). This is the definition of the occupied life annuity. Obviously, the sale price will have to be reduced since the owner retains a right of residence on the property sold.
Investing in life annuity
In 9 out of 10 cases, the life annuity refers to the seller’s principal residence that continues to occupy it. He reserves the right of use and habitation which allows him to remain in the place until his death. The main disadvantage is that the buyer cannot take advantage of the property acquired many years ago. He must therefore have not only capital to invest, but also comfortable (and stable) income to pay the rent. In the event of unpaid invoices, the sale will be cancelled and the sums paid will remain with the seller. On the contrary, the “free” life annuity allows the box to be immediately available. As a result, the buyer can rent it for income that covers all or part of the annuity payable to the seller. But they are very rare and concentrate on small areas. In addition, they cost more than a “busy” life because the buyer pays for the immediate availability of the housing. Unlike a financially conventional property purchase, the purchase of a good life annuity is, in principle, twice. For more informations contact agency real estate Mougins. A fraction, the bouquet, is payable in capital at the signing of the deed of sale at the notary’s office. Determined by the seller and the buyer, this payment is not mandatory. However, it is very commonly practiced. Its amount is generally between 10 and 40% of the estimated value of the property sold. This depends mainly on the needs and aspirations of the seller. Most often, he needs income to supplement a retirement that is too small, and he is content with a small bouquet to increase his income. But it may also want to immediately obtain significant capital to carry out a short-term project,
Become an owner
The buyer in the life annuity becomes the owner of the property as soon as the sale is signed. In the case of the purchase of an occupied life annuity, the buyer has the title of owner while the seller enjoys it, which is the right to inhabit it.