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  • Property-a-holics

    Get a discount and inherit a squatter.

    Came across a quick article in The Sun:

    A 64-YEAR-OLD man is selling his three-bed home in a posh area for a "£200,000 discount" - but there's a serious catch.

    Peter Yielding put his neat semi in pricey St Albans on the market for £350,000, hundreds of thousands of pounds less than other homes on the street.

    The online listing also features a garage, driveway and describes it as perfect for investors.

    But an unusual addition is the request that "the current vendor would like to remain at the property rent free as a long term tenant".

    https://www.thesun.co.uk/news/8860629/ma...-discount/

    Don't know if this is a clever idea or quite common, thoughts?

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     I live in France where this is quite common, buying a property 'en viager'.  You can buy a property 'viager libre', which means you pay a deposit and then a monthly rent for the life of the vendor, or 'viager occupé', where you pay the deposit and the monthly rent for life and the seller occupies the property until they die or go into a retirement home, and at the latter point you still pay the rent but can let the property to cover it. 

    It's probably been common here because property can be sold off to cover retirement home fees upon death, so they may as well get the benefit before they die.  Maybe it'll become more popular in the UK for the same reasons, as more and more of people's estate is recovered to pay for health and social care?

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    Once again it throws up the story of the man who purchased a flat in Paris and the women lived for 121 years out living the buyer. So the moral of the story is don't buy from old ladies, the chances of them out living you is high.

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    Agreed - annual mortality rates increase every year in adulthood - but seem to plateau around age 90 - though actuaries are wary of quantifying future life expectation thereafter as the numbers are too low for a sensible confidence factor.

    The subject property in St Albans sounds about half price as I would expect to be paying circa £700k plus.

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    Sounds like a DIY 'lifetime lease' arrangement. If he's found a good solicitor to prepare it I would say he's being rather clever.

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    I would want to know his medical history first. Men tend to die younger than woman (average age 79.2 years). How many investments would earn £200 000 in 12 years (ROI 16.6% pa)?

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    Not sure if I've missed something, but isn't this a 'sale and rent back' or a variant of a home reversion plan? Both of which are FCA regulated, so you'd have to be FCA authorised to enter into this arrangement.

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    I would have concerns about buying a property where there are no pictures of the inside, one picture of the outside and three pictures of the good parts of St Albans, miles from this property. It is not in a good area. https://www.rightmove.co.uk/property-for-...19500.html

    I would much prefer to buy https://www.rightmove.co.uk/property-for-...80117.html. Yes, I will have to pay a service charge but it isn't as run down as I suspect Mr Yielding's house is and there will be an income from rent.

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    I have a couple of Life Time tenancies in my portfolio. It offers certain benefits, but also has a certain level of risks.

    They are viewed as long term investments. Indeed the tenants my outlive me, and my next generation. But that is factored into the risk return calculations of the investment

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