Choosing where you will live during your retirement years takes a lot of planning, much of which happens long before you reach retirement age. It requires you to make some important decisions about the lifestyle you would like to live, location, ongoing costs, healthcare provision, proximity to family, amenities, and so on.
When you retire, one of the most important decisions is the form of property ownership you choose for your retirement – in most retirement developments you have to choose between life rights and full ownership.
Your choice must be based on a well-considered financial retirement plan that looks at aspects such as affordability, investment returns, lifestyle, security, and healthcare needs, among others. In this regard, understanding the difference between life rights and full ownership before you sign on the dotted line, is vitally important.
A life rights agreement means you buy the right to occupy the property or unit for the rest of your life, but you never own it, nor can you bequeath it to anyone after you pass on. Since you can’t get a bond for a life-rights purchase, there will be no bond registration fees, nor any property transfer duties that come with full ownership of a property. You won’t have any rights to how your living space is run, nor do you receive any capital growth returns for your financial investment.
With full ownership, you own your property in the retirement development and an undivided share in the common property (since it is in a sectional-title scheme). You, therefore, reap the full benefits of the capital growth, and you will be able to bequeath it to your loved ones.
It’s really important that buyers understand the distinct difference between life rights and full ownership and its impact on their capital investment. A life rights option can never be regarded as a property investment as there is no ownership of an asset that can grow in value. Neither the buyer nor their estate or beneficiaries stand to benefit financially from a life rights transaction, so think carefully about how you invest your money. Essentially a life rights buyer signs an agreement to pay a contribution which gives them the right to live in a unit for as long as they are alive, but that is where the value ends.
Limited supply coupled with very strong demand, makes full ownership retirement property in well-managed lifestyle developments one of the best and least risky options for investors. But with only a few retirement developments allowing full ownership and investors of any age to buy into it, finding these investment gems is not that easy. When you find a retirement development, like Celebration Retirement Estate in North Riding, which allows anyone of legal age to buy a unit and let it to tenants aged 50 years and older, it is one of the best residential property investments you can make.
When choosing the type of retirement property you want for your golden years which would yield the best return on your investment, ownership of a retirement lifestyle property provides exceptional returns, an exceptional lifestyle, and a legacy that can be bequeathed to your loved ones. This is why Celebration Retirement Estate in North Riding is the perfect place to retire!
