Calculate the bouquet and annuity of a life annuity
Life annuity (viager) is a form of real estate sale where the buyer pays an initial lump sum then a life annuity to the seller.
Life annuity (viager) is a form of real estate sale where the buyer pays the seller an initial capital called bouquet, then a life annuity until the seller's death.
The seller retains the right to live in the property (DUH). Price discounted by 30 to 50% depending on age. Most common.
The buyer can occupy or rent the property immediately. Price close to market value. Rarer.
Bouquet
Initial capital (20-40%)
Annuity
Monthly payment for life
DUH
Right of Use and Habitation
Advantages of life annuity
For the buyer:
• Discounted acquisition
• No bank loan needed
• Staggered payment
For the seller:
• Retirement supplement
• Stay home for life
• Partially tax-free annuity
Life annuity risk: Life annuity involves a risk related to the seller's lifespan. If the seller lives long, the buyer will pay more than the property value. This is the very principle of life annuity: a random contract.
Bouquet
Initial capital
Annuity
Actuarial calculation
DUH
Housing right
Life expectancy
INSEE tables
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