Occupancy Coefficient
Percentage discount applied to the market value according to the seller's age, to calculate the value of the occupancy right.
Full definition
The occupancy coefficient (or discount coefficient) is the percentage used to calculate the value of the seller's occupancy right in an occupied life annuity. It is mainly determined by the annuitant's age at the time of the sale.
This coefficient is based on the mortality tables (statistical life expectancy) and generally varies from 20% to 70% according to age. The younger the seller, the higher the coefficient, as their potential occupancy will be longer. As a guide: 60% at 65, 50% at 70, 40% at 75, 30% at 80.
Other factors can influence this coefficient: the seller's sex (women have a longer life expectancy), the type of right (usufruct vs right of use and habitation), apparent state of health, and the characteristics of the property. The scales vary between professionals and may be subject to negotiation.
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Related terms
Mortality Table
Statistical data on life expectancy by age and sex, used to calculate the life annuity.
Occupied Value
Value of the property in an occupied life annuity after deduction of the occupancy right (right of use and habitation or usufruct), the basis for calculating the bouquet and annuity.
DUH (Right of Use and Habitation)
Right allowing the seller to personally occupy the home sold via life annuity until their death, without being able to let it.
Usufruct
Right to use a property and receive its income (rents) without owning it, more extensive than the right of use and habitation.
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