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Brandon DonnellyHow "viager" transactions work in France
In the 9th century, France enacted into law a way to buy and sell property through something known as une vente en viager. My understanding is that there are other European countries that also allow this, but that it's most popular in France, even if it still forms a relatively small portion of the market.
Here's how it typically works. You're an older person (or older couple) and you want to use your home to generate some cash, but you also want to stay living in your home until the very end. So you offer it up for sale en viager occupé. (This is the most popular option, but there's also le viager libre, where the seller moves out immediately.)
Whoever buys it will usually pay you, the seller, in two ways. They will pay you an upfront lump sum (called le bouquet) and a recurring payment (called la rente viagère) up until the day you die (or both of you die). Once this happens, the buyer then gets full enjoyment of the property. The transaction is complete.
So why would either party want to sell and buy in this way?
Well, if you're the seller, the obvious benefits are that (1) you get to continue living in your home and (2) you get some money now and for the rest of your life. This can be useful if you, say, run out of cash during retirement. It's a means to financial independence.
For buyers, it's the opportunity to maybe acquire a property below its current market price. Because if you don't have access to the home until some undetermined date in the future, well then a discount will obviously need to be applied. The initial lump sum payment is often around 30% of the current value. The other attractive feature is that it's a form of financing for buyers who may not have all the money they need today.
In the 9th century, France enacted into law a way to buy and sell property through something known as une vente en viager. My understanding is that there are other European countries that also allow this, but that it's most popular in France, even if it still forms a relatively small portion of the market.
Here's how it typically works. You're an older person (or older couple) and you want to use your home to generate some cash, but you also want to stay living in your home until the very end. So you offer it up for sale en viager occupé. (This is the most popular option, but there's also le viager libre, where the seller moves out immediately.)
Whoever buys it will usually pay you, the seller, in two ways. They will pay you an upfront lump sum (called le bouquet) and a recurring payment (called la rente viagère) up until the day you die (or both of you die). Once this happens, the buyer then gets full enjoyment of the property. The transaction is complete.
So why would either party want to sell and buy in this way?
Well, if you're the seller, the obvious benefits are that (1) you get to continue living in your home and (2) you get some money now and for the rest of your life. This can be useful if you, say, run out of cash during retirement. It's a means to financial independence.
For buyers, it's the opportunity to maybe acquire a property below its current market price. Because if you don't have access to the home until some undetermined date in the future, well then a discount will obviously need to be applied. The initial lump sum payment is often around 30% of the current value. The other attractive feature is that it's a form of financing for buyers who may not have all the money they need today.
Support Brandon Donnelly
Brandon DonnellyHow "viager" transactions work in France
Subscribe to Brandon Donnelly
Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly.
Brandon DonnellyCanada must become a global superpower
The silver lining to the US starting a trade war with Canada and regularly threatening annexation is that it has forced this country out of complacency. Indeed, I'm hard pressed to remember a time, at least in my lifetime, when patriotism and nationalism has united so much of Canada. According to a recent survey by Angus Reid, the percentage of Canadians expressing a "deep emotional attachment" to the country jumped from 49% in December 2024 to 59% in February 2025. And as further evidence of...
Brandon DonnellyThe bank robbery capital of the world
Between 1985 and 1995, Los Angeles' retail bank branches were robbed some 17,106 times. In 1992, which was the the city's worst year for robberies, the number was 2,641. This roughly translated into about one bank robbery every 45 minutes of each banking day. All of this, according to this CrimeReads piece by Peter Houlahan, gave Los Angeles the dubious title of "The Bank Robbery Capital of the World" during this time period. So what caused this? Well according to Peter it was facil...
Brandon DonnellyThe story behind those pixelated video game mosaics in Paris
If you've ever been to Paris, you've probably noticed the small pixelated art pieces that are scattered all around the city on buildings and various other hard surfaces. Or maybe you haven't seen or noticed them in Paris, but you've seen similarly pixelated mosaics in one of the other 79 cities around the world where they can be found. Or maybe you have no idea what I'm talking about right now. Huh? Here's an example from Bolivia (click here if you can't see...
We have something similar, but potentially less likely to inspire murder, in the U.S. It's the reverse mortage and it's pretty popular for the resons you listed. The problem is, there may be clauses in the agreement with the bank that the owner has to move out in certain conditions, including deteriorating health, and that can be manipulated by the bank's representatives in order to acquire the property at below market price. There is no free mortgage (mortgage literally means a "death pledge.")
In the 9th century, France enacted into law a way to buy and sell property through something known as une vente en viager. Here's how it typically works.
You're an older person (or older couple) and you want to use your home to generate some cash, but you also want to stay living in your home until the very end. So you offer it up for sale en viager occupé.
Whoever buys it will usually pay you, the seller, in two ways. They will pay you an upfront lump sum (called le bouquet) and a recurring payment (called la rente viagère) up until the day you die (or both of you die). Once this happens, the buyer then gets full enjoyment of the property. The transaction is complete.
So why would either party want to sell and buy in this way? Full blog post here: https://brandondonnelly.com/how-viager-transactions-work-in-france-1
Interesting. The buyer is wagering on the seller’s life expectancy while the seller is trusting the buyer not to facilitate said seller’s untimely departure. Not morbid at all.
except that as a buyer, you've now created an incentive to hope for early death
How "viager" transactions work in France
Somewhere between a reverse mortgage and a tontine!
In the end, this is a bet on life expectancy. Because if the seller ends up living for a really long time, then they get the benefit of more annuity payments. However, if they end up living fewer years than expected, then the buyer benefits from having to pay less in annuity payments. They got to buy below market.
It's a fascinating pricing and time-value-of-money exercise, but it's also a potentially morbid way to buy real estate. On the one hand, you could be helping someone live a dignified retirement. On the other hand, you stand to benefit if they die sooner than expected.
Cover photo by Zach Dyson on Unsplash
In the end, this is a bet on life expectancy. Because if the seller ends up living for a really long time, then they get the benefit of more annuity payments. However, if they end up living fewer years than expected, then the buyer benefits from having to pay less in annuity payments. They got to buy below market.
It's a fascinating pricing and time-value-of-money exercise, but it's also a potentially morbid way to buy real estate. On the one hand, you could be helping someone live a dignified retirement. On the other hand, you stand to benefit if they die sooner than expected.
Cover photo by Zach Dyson on Unsplash
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We have something similar, but potentially less likely to inspire murder, in the U.S. It's the reverse mortage and it's pretty popular for the resons you listed. The problem is, there may be clauses in the agreement with the bank that the owner has to move out in certain conditions, including deteriorating health, and that can be manipulated by the bank's representatives in order to acquire the property at below market price. There is no free mortgage (mortgage literally means a "death pledge.")
In the 9th century, France enacted into law a way to buy and sell property through something known as une vente en viager. Here's how it typically works.
You're an older person (or older couple) and you want to use your home to generate some cash, but you also want to stay living in your home until the very end. So you offer it up for sale en viager occupé.
Whoever buys it will usually pay you, the seller, in two ways. They will pay you an upfront lump sum (called le bouquet) and a recurring payment (called la rente viagère) up until the day you die (or both of you die). Once this happens, the buyer then gets full enjoyment of the property. The transaction is complete.
So why would either party want to sell and buy in this way? Full blog post here: https://brandondonnelly.com/how-viager-transactions-work-in-france-1
Interesting. The buyer is wagering on the seller’s life expectancy while the seller is trusting the buyer not to facilitate said seller’s untimely departure. Not morbid at all.
except that as a buyer, you've now created an incentive to hope for early death
How "viager" transactions work in France
Somewhere between a reverse mortgage and a tontine!