Life annuity investing is still relevant in 2022. But is it still a good deal? To find the answers, you must first understand the principle of life annuity. It then becomes easier to decipher its advantages. Focus!
A brief reminder of the principle of the life annuity
Purchasing a real estate annuity simply consists of acquire a property without occupying it immediately. The owner of the accommodation is often an elderly person or an elderly person.
As part of an annuity investment, the seller is called an annuitant. The buyer, meanwhile, obtains the title of debtor.
The principle is simple; the beneficiary transfers his estate to a debtor who subsequently undertakes to pay him an annuity until his death. The buyer thus becomes the owner of the property, as soon as the sale is concluded. However, he is not yet authorized to occupy the property he has just purchased. There is, of course, another form of real estate annuity to remove this small constraint: the occupied annuity.
The life annuity can therefore take two distinct forms:
- The free annuity
- The committed annuity
The free annuity turns out to be rarer, it allows you to buy a property to live in immediately or to rent it.
- The disadvantage: the annuity paid to the beneficiary up to his death is higher.
By choosing the occupied annuity, you benefit from the right of use and residence (DUH). It’s the most common these days. The occupied annuity allows you to reside in the acquired property until your death. Either way, you have to wait patiently for the beneficiary to die before moving there.
Focus on the benefits of real estate annuity!
The life annuity is beneficial both for the seller (the annuitant) but also for the buyer (the annuitant). The future owner, for example, can access the property without resorting to real estate debt. He therefore escapes the interest charged by any bank.
It’s entirely possiblebuy a property in life with a low contribution. In fact, it remains below 30%, calculated on the basis of the market value of the home. The deed of sale is signed with a notary. And at that moment, the buyer will have to pay an amount in cash. It will also be necessary to set a deadline for the payment of the annuity intended for the annuitant. Also, notary fees are low.
The icing on the cake, the debtor pays no tax in the context of a busy life purchase.
The market of #lifeannuity continues to develop and represents around 1 billion euros!
Indeed, this market grew by 6% in 2021 and demonstrates a progression that has accelerated every year over the past decade. 📈 pic.twitter.com/S3bv08uXrn
— Agence Ferrero (@AgenceFerrero) June 8, 2022
