SPANISH REVERSIONS

Spanish Home Reversions. Up to 50% off Valuation.

A home reversion scheme enables investors to buy an elderly person's property at a discounted value. This is achieved by giving the homeowner a lump sum together with a rent free life tenancy agreement.

Normally an investor would expect to achieve an average 5-7% rental income, although this would be depleted by agent's fees and vacant periods. Therefore paying an elderly sitting tenant a lump sum in advance in exchange for a life tenancy agreement could be a very attractive and trouble free proposition.

A single male aged *70 is expected to live for 12.65 years according to recent (2003) mortality tables. Therefore a 4% (euro) rental paid in advance for *12.5 years would amount to *50% off the official valuation price to an investor. Alternatively a lady aged *80 has a life expectancy of 8.65 years, so the reversionary value would then be *66% of valuation.

The scheme is not suitable for everyone although benefits both parties as investors can buy a Spanish property at a significant discount to valuation without all the problems associated with rentals. On the other hand the occupants remain in their own home for life with a substantial increase in their quality of life together with inheritance tax savings.

Naturally there are a number of considerations such as legal and arrangement fees together with a contract that protects the interests of both parties. The contract will have certain clauses that cover various issues, such as maintenance of the property and early exit provisions if the tenant needs to vacate the premises.

*Equity release figures and ages are rounded down.

Spanish Quest will be launching a home reversion scheme for Spanish properties in the near future and subscribing members are invited to register their interest.

Contact - info@spain4you.org

30 Montgomery Way
Manchester M26 3TG
Tel: 0044(0)161 723 0987
E-mail: info@spain4you.org
www.spain4you.org