The sale of bare ownership

The advantages and dynamics of bare ownership

When a house is sold, according to the most common of formulas, it is made available from the outset to the buyer. Transferring bare ownership is a useful middle way for those who, having reached a certain age, wish to earn money quickly by giving up part of the value of full ownership (the value of bare ownership is obtained by subtracting the value of usufruct from the value of full ownership). The benefits also include maintenance: extraordinary and structural works, for example, are the responsibility of the bare owner. Of course, as in any other real estate context, there are many legal and economic nuances; that is why it is a good idea to seek the advice of experts, who can define the terms of the agreement without neglecting any parameters.

The numbers: how much is bare ownership worth?

As already mentioned, to find out the value of the bare ownership you have to subtract the price of the life usufruct (i.e. the 'permission' to continue living in the house for life) from the price of the full ownership. The amount of the usufruct is calculated according to criteria regulated by law, taking into account the interest rate and the life expectancy of the usufructuary. For instance, the value of the usufruct may be higher when the usufructuary is young, or has a high life expectancy. Sales of bare ownership have been on the rise in recent years, making it a profitable market for both parties involved. Sellers include in particular older people who wish to financially support their children or grandchildren; buyers are often investors or fathers of families who are committed to ensuring a smooth future for their children.

The importance of professionals in contract management

The way in which bare ownership is administered by sellers and buyers does not present particularly complex patterns; the nuances that can differentiate each contract from the others, on the other hand, can pose difficulties for the less experienced. Engel & Völkers consultants accompany their clients through the various steps of the sale, from identifying potential buyers to checking the documentation: the only way to ensure peace of mind during the process, avoiding worries and uncertainties.