Is buying a life annuity a good investment?

The purchase of real estate in life is attractive for many investors in this sector. In real estate the purchase in life allows the buyer the annuitant to be the purchaser of an apartment, a house or a building for a monthly payment or not to a seller called annuitant. Certainly it is a good opportunity to invest in a sector in perpetual change but it is essential for any potential buyer to know if it is a suitable investment.

Consider your financial capacity

Before making the choice of a lifelong purchase in real estate, the investor must first make an analysis of his financial capacity. In the event that he does not have a sufficient contribution, his investment risks being a failure.

Indeed, he must pay the total amount of the bouquet and the notary fees when tying up the contract. Similarly, he must be able to ensure the payment of the annuity on the due date, and this until the death of the annuitant as stipulated in the contract. The purchase of real estate in life is an investment which therefore requires funds regardless of the financial resources at its disposal.

Especially since it is very difficult to obtain a bank loan to invest in real estate for life. Failure to comply with the terms of payment causes the buyer to incur the loss without any refund of the property acquired. Especially if the deadlines for the annuities are not respected.

This type of real estate purchase must be a real investment strategy for the investment to be profitable. Investing suddenly with emotions or on a whim leads the buyer to failure. Good real estate investment requires setting goals by first answering this question  »what do I expect from my life investment? »

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Read also: Calculation of life notary fees: the essentials to know

Avoid failure in your investment with the age criterion

Most buyers who invest in real estate with a life purchase are afraid of making a bad investment. This fear is mainly linked to the criterion of the age of the seller but also of the buyer.

Prioritizing the advanced age of the seller based only on the theoretical life expectancy is a risk to be taken, because it is not certain that the person who sells his property in life will die at the probable age set.

So for the investment to be profitable, age is certainly important, but you still have to assess whether the property is in good condition. If you are too old an investor, you risk investing blindly without being able to make your investment profitable. In both cases, it is advisable to think coldly before making this investment. In the end, buying a life annuity involves risks that strongly influence a good investment that the buyer will not regret. However, as in all real estate transactions, it is necessary for those who want to invest their money to have some control over the ins and outs of a good life purchase. The most sensible solution for the investor is to learn about this type of real estate transaction and to be accompanied by experts in the field.

Read also: Buying real estate in life annuity

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