Properties retirement: House against pension

Many retirees have a large fortune, but that is in the house – her pension is usually low. With the retirement of their property, they can make their homes into cash and stay still live in it. There are several things to consider.

Many senior citizens in Germany are facing a problem: while you live in your own house and save on rent. But despite valuable home, they are short of money. hardly the low pension sufficient to defray extra costs to repair the necessities or for older people rebuild. Nevertheless, many retirees want to stay as long as possible to live at home. The move comes for the fewest in question.

A solution offers the retirement of a property. In the annuity owner sold his house to an investor or a non-profit organization – but for a price that is well below the market value. For that the buyer him guarantees usually lifelong residency and pays instead of the purchase price a monthly pension. What they fail depends on the sex and age of the seller and the value of the property, including the interest rate risk, is taken into account. In general, the annuity is linked to inflation and increases with time. After death, the house goes into the ownership of the buyer. The seller may also agree on a minimum term. he dies prematurely, the heirs will receive a pension on until the term ends.

The right of residence should be recorded in the deed of sale and entered as a senior mortgage in the land registry. So the inhabitants are sure he does not have to take off when the house is sold. In addition, a fall-back clause should be in the contract. Then the seller gets back the property if the buyer becomes insolvent and can not pay the annuity. The contract also regulated if the seniors have to pay more for maintenance and rehabilitation.

Another model is the usufruct, in which the seller has more rights in dealing with the property. So the usufruct always ends only with death – as opposed to living right that can be limited in time. Attracts residents about the nursing home, he can as usufruct Authorized rent his home and keep the receipts – that allowed residents not living right. Even the usufruct should be entered for bankruptcy protection in the first place in the Land Register.

Unlike the classic annuity of beneficial owners will receive the purchase price paid in one fell swoop. The proceeds of retirees can put it into a savings plan, invest in the capital market or take out with an insurance company a contract for a drawn immediately pension (immediate annuity against lump-sum payment). To determine the sales price, the buyer moves the market value from the usufruct value. The results from the rental of the property per year multiplied by the remaining life expectancy of the seller. With a very high life expectancy calculated the buyer hedges against the possibility that the beneficial owners reach a ripe old age.

The retirement of the property is suitable for owners aged 70 or older who are in debt, refer a small pension or do not want to inherit her house or can because they have no offspring. It also comes to retirees in question that still want to afford some luxury like big tours or restaurant visits. Interested parties should durchrechnen possibilities for critical, compare and let audited by independent experts such as the consumer centers. Because financially, a retirement compared to sales worth significantly less. High supplementary pensions or sales returns are available only in metropolitan areas, where property and land increase in value over the long term.

The more profitable alternative: the house on their own to sell at the market price, purchase a small, barrier-free apartment from the proceeds or rent – that also fall off the cost of repairs – and save the rest. Since there are no deductions for residential or a usufruct, can be achieved a much higher price. The pensioner may be able to negotiate with the new owner of his house also has a long-term lease – and yet spend his old age home.