Buying a property with a lifetime tenancy

by Readers Question

8:18 AM, 29th January 2014
About 7 years ago

Buying a property with a lifetime tenancy

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Buying a property with a lifetime tenancy

Hi all, I have been looking at sales particulars for 3 bed house which is subject to a lifetime tenancy. It is valued at £195,000 with vacant possession and is for sale for £82,000.

I would very much appreciate your thoughts and any advice you can offer.

The details are as follows.

  • 3 bedroom detached family home in Bexhill, East Sussex, TN39.
  • The property benefits from 3 bedrooms, modern kitchen and bathroom, lounge, dining room and rear garden.
  • The house also has double glazing, gas central heating and off road parking.
  • The property has been valued independently at £195,000 and we are inviting offers in excess of £82,000.
  • The property has a current RICS valuation of £195,000
  • Your discount on this purchase will be £113,000
  • Are offering a 100% interest in this investment
  • The property will be sold with Life Tenants in residence
  • You will legally own the property which is occupied by a male aged 79 and female aged 65
  • The Life Tenants will remain in the property until they either pass away or move into full time residential care.

During the Life Tenants’ occupancy, they will maintain the property covering all associated expenditure, including:

  • Maintenance
  • Utility bills
  • Council tax
  • Any service charges or ground rent if applicable

When the Life Tenants vacate the property permanently, it is yours to do with as you wish but until then if any one purchases the property, there is no rent paid by the tenants so no rental income can be made. Also the buyer can not live in the property until its vacated by the life tenants. Buying a property with a lifetime tenancy

It is only possible to view the property only via photos.

The buyers name will be on the land register and property title under the following conditions:-

  • Will appear on both the land registry and title documentation and will hold the deeds.
  • The Home for Life lease places a restriction on your title which falls away when the lease ends which will occur when the Life Tenant passes away or goes into permanent care.
  • A RICS survey is provided but the vendo/life-tenants will not allow buyers to carry out there own survey on the property.

So it seams all you can do is either wait years for vacant possession or try to sell for a profit.

Any advice and opinions would be most welcome.

Regards

Tony


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Comments

Renovate To let

14:36 PM, 30th January 2014
About 7 years ago

Reply to the comment left by "Tony Church" at "29/01/2014 - 20:34":

Yes, that's how the schemes work. The customer decides how much, if any, equity they want to retain at the end of the scheme and pays a proportion of the property price to get the right to stay there rent free until death/long term care.

The investor pays the rest of the purchase price and gains the right to possession, minus the retained equity (if any) once the Tenant(s) die or move into care. The right is recorded at the Land Registry.

Clearly not mortgageable as you are not buying the property now and vacant possession cannot be obtained by the Lender if you default.

To moderator: the link I inserted was not an attempt to advertise, just a way to show a pic of the property referred to.

Mark Alexander

10:39 AM, 8th February 2014
About 7 years ago

An IFA called Garry Streeter has just published an informative article about Home Reversion plans. It would appear this could have been what the lifetime tenant, in the property Tony was looking to buy, might have organised and the provider is now selling the deal on.

See >>> http://www.property118.com/home-reversion-plans-the-hidden-truths/63545/
.

property one

12:31 PM, 1st July 2014
About 6 years ago

I would recommend you speak to someone that fully understands these investments as some of the various comments posted here are not really helping you make an informed decision.

Some of the ridiculous assumptions made here on the type of investment you have kindly shown and the returns that could be made clearly demonstrate their lack of experience so one has to ask is this really advice .

My advice speak to someone that knows in depth about your particular investment rather than listen to or take some of these postings seriously.

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Latest tier restrictions are a pretty blatant attack on less wealthy areas of the country

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