With the decline in the number of active people and the increase in the number of retirees in Switzerland, the balances in the labour market and on the pension and health systems will undergo profound changes.

These are mainly people of a certain age or retired who sell their property for life in order to obtain additional income while retaining the right to stay living in the property for sale for life, ensure additional income for life, benefit from significant tax advantages and anticipate the succession.

The seller of the life property is named in law: the "creditor" because he is the creditor of the annuity, the buyer is called the "debiter" because he will be the debtor of the annuity.

The life purchase in Switzerland can be paid in several ways: in the form of a bouquet and/or an annuity. The sale of a property for life includes a tax advantage for the creditor and the debtor. Life annuity generally applies mainly to sales of apartments, houses or land. It is a notary who draws up the life sales contract. As soon as the deed of sale for life is signed, the apartment, house, or land becomes the property of the buyer.

The life annuity is a type of exclusive investment, a tailor-made solution that perfectly adapts to the interests of buyers and sellers.

In concrete terms, the transaction consists first of estimating the property. It is possible to pay only one annuity without any bouquet. The bouquet is not mandatory but in practice it is planned to reduce payments for life. With a bouquet, the seller can repay debts (especially to repay a mortgage). He can also use his bouquet for donations or use it to travel. In general, the older the seller is, the more important the bouquet is.

Several criteria define the amount of the annuity. It is established between the parties freely according to the age and life expectancy of the creditor, taking into account the valuation of the property at its fair value. The annuity varies greatly according to age. The life annuity can be paid once a year or every month, every quarter.

The annuity is a good formula for an income or retirement supplement.

Nuance of size The difference between usufruct and the right of residence lies mainly in the fact that the usufructuary can transmit the exercise of his right to a third party, which is not the case of the beneficiary of a right of housing.

The usufructuary is therefore free not to live in the property and can rent all or part of the building, while the beneficiary of the right of housing is the only one who can live there. The usufructuary assumes the maintenance of the thing, taxes, insurance premiums and interest on the mortgage debt. He must carry out acts of administration related to the use and enjoyment of the house. Thus, he must assume all the charges and repairs including more important work, such as major repairs or other measures essential to the conservation of the building.

The beneficiary of a residential right only bears ordinary maintenance repairs. He does not have to assume the payment of mortgage interest, insurance premiums, or taxes and fees in relation to the building.

Tax on rental value remains in both cases the responsibility of the occupant (usufuctuary or beneficiary of the right of housing).

Constitution and end of personal servitude.

The constitution of a right of usufruct or a right of residence may result from an agreement or a situation provided for by law.

A contract constituting the usufruct or right of residence, in the matter of immovable property, must take the authentic form. It will thus be a notarised deed. In order for this right to be validly constituted, the owner must also apply for registration in the Land Register, otherwise it will not take birth, despite the will of the parties.

When nothing has been provided for in an agreement, the Civil Code also provides, under specific legal conditions, the possibility for the surviving spouse to request that a right of usufruct or a right of residence be attributed to him on the building where the couple lived. Thus, your spouse could have a legal right to the constitution of one of these easements, without it being necessary to proceed in advance. However, it is best to plan this in advance.

Usually, the usufruct and the right of housing end with the death of the last beneficiary (in the case of the plurality of beneficiaries) in whos favour of whom the right was constituted. However, this right may have been constituted for a predetermined time, but which cannot exceed the life of its beneficiary. Finally, the usufructuary may unilaterally waive it or terminate it by contract with the bare owner.

The person who acquires the life property is called: the debtor.

The Débirentier pays the bouquet and must pay the annuity.

In the event that the creditor is no longer able to pay the annuity for any reason, the creditor may request the return of his property and may have the right to have the sale resolved. If the debtor dies, it will be the responsibility of his heirs to assume the payment of the annuity to the creditor, whether or not he lives in the property.

The seller of a life property is called the creditor. The creditor receives a capital called the bouquet, and this immediately, then an annuity bringing him a regular income supplement in addition to his retirement. For the creditor, the fact of receiving a lifetime annuity allows him to keep his purchasing power and to support himself under better conditions and especially to stay in his home, if he is sold in an occupied life.