The initial cost of securing a life lease varies widely. First of all, the cost of the unit will be affected by its size, amenities and location. In addition, the proportion of that cost covered by initial payment could be affected by other factors, such as the age of the individual or couple, and the amount of the payment that can be redeemed at the end of the lease by the leaseholders or their heirs. In general, the initial payment for a life lease will typically vary from 25 to 100% of the cost of purchasing a similar unit outright.
Life Lease projects cater mainly to senior adults. They particularly provide older homeowners with an opportunity to move into smaller, more manageable housing options than their existing homes. Qualifying homeowners typically are able to use the equity resulting from the sale of their homes for the entrance fee payment. Depending upon the project, the amount of that payment is affected by various factors, including their life expectancy and the redemption value of the unit at the end of the lease. In many cases, financing is also available for some portion of the value of the life lease.
Essentially, life lease projects provide individuals and senior aged couples with an affordable housing option with a life time right to occupy a unit and have access to communal facilities and services with the assurance that their neighbours will be in the same age group. Heritage Life – Retirement Living policy requires that the minimum age of an individual or one of the partners be 55 years or older. If the qualifying spouse passed away leaving an “under aged” partner, that person will be grandfathered into the life lease unit and not be required to move.