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Life Long Usufruct

 

WHAT IS THE LIFE-LONG USUFRUCT (USUFRUCTO VITALICIO)  AND WHAT IS IT WORTH?


The usufruct is the right of enjoyment, enabling a holder to derive profit or benefit from a property that either is titled to another person or which is held in common ownership, with the obligation to keep it and care for it as if it was their own. 

You can sell the "bare property" and keep the usufruct for yourself, and therefore the full property would only go to the purchaser once you die.

The value of this life-long usufruct is 70% of the house value when you are under 20 years old and looses 1% of the house value per year from the time you reach 20 years of age, with a minimum value of 10% of the price of the property.

The best way to calculate the value of the usufruct is as follows: Usufruct = 89 - your age. Bearing in mind that the maximum value of the life-long usufruct is 70% and the minimum value is 10%.

 

Example 1 Value of a life-long usufruct in the case of a beneficial owner (usufructuary) of 32 years of age on a property valued at 150.000 €.

U = 89-32 = 57%

150.000 € x 57% = 85.500 €

Example 2 Value of a life-long usufruct in the case of a beneficial owner (usufructuary) of 82 years of age on a property valued at 150.000 €.

U = 89-82 = 7%

150.000 € x 10% (minimum limit of the usufruct value) = 15.000 €

Example 3 Value of a life-long usufruct in the case of a beneficial owner (usufructuary) of 18 years of age on a property valued at 150.000 €.

U = 89-18 = 71%

150.000 € x 70% (maximum limit of the usufruct value) = 105.000 €

 

SIMULTANEOUS AND SUCCESSIVE USUFRUCT. If two people hold the usufruct on a property, the value will be calculated on the age of the youngest of them.

Example A married couple of 70 and 73 years of age who give to their children their property valued at 150.000 €, withholding the life-long usufruct until the last spouse’s death.

U = 89 - 70 (age of the youngest spouse) = 19%

150.000 € x 19% = 28.500 €

 

BARE OWNERSHIP (NUDA PROPIEDAD). The value of the “bare ownership” (ownership of the property without the usufruct) will be the difference between the total value of the property and the value of the usufruct.

FO (full ownership) = BO (bare ownership) + U (usufruct)

BO (bare ownership) = FO (full ownership) - U (usufruct)

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