With £30m worth of Life Tenancies delivered in 2018, Life Tenancy Investments continue to be a great way for investors to purchase UK investment properties at prices [up to] 60% lower than RICS independent valuations.
With many landlords in the UK struggling to make clean profits from difficult tenants, voracious agents and constant maintenance issues, Life Tenancy Investments flourish with a hands-off and safe investment opportunity.
Life Tenancy Investments
Life Tenancies are medium to long term, low maintenance residential investments based predominately in the south of England. The reason the properties are available with such an enormous discount is that each property comes with a Life Tenant; a person aged over sixty who has bought the right to live in that property rent free for their lifetime.
Discounts for investors are actuarially calculated based on the tenants age and mortality statistics.
Comparing Life Tenancies with Buy to Let
There are great benefits to both strategies but the reasons it would seem that Life Tenancy Investments may be more appealing to some investors are:
- Lower Entry Point – Because of the huge discount, investments start from just £50k.
- No Income Tax – All benefits from this strategy come from the upfront discount and years of house price inflation, thus there is no income to be regularly taxed.
- No Headaches – Because there is only one tenancy taking place and those tenants are responsible for the upkeep of the property, investors won’t need to be involved with the property at all.
- Minimal Payments – Insurance, council tax and other fees are all responsibilities of the Life Tenants. The only small fee for investors is for an annual report on occupancy, condition and market price.
- Brexit-Proof – Unless Brexit crashes the UK into an apocalypse, Life Tenancy Investments can easily be considered Brexit-proof. The large upfront discount means that a property would have to decrease in value to the same level as the discount before an investor could ever lose a penny.
To learn more about life tenancy investments, click here.