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# What is a life estate in real property?

## What is a life estate in real property?

A life estate is property, usually a residence, that an individual owns and may use for the duration of their lifetime. This person, called the life tenant, shares ownership of the property with another person or persons, who will automatically receive the title to the property upon the death of the life tenant.

How is the value of a life estate determined?

The interest remaining after the death of the life tenant is called the “remainder interest”. After the death of the life tenant, the remainder man enjoys full ownership of the life estate land or property. A life interest in property has a value that can be determined by an actuarial calculation done by a professional actuary.

### How to value a property with a life use?

The property is encumbered by a Life Use that has been granted to a 70-year-old person. There are a series of steps that must be taken in this valuation scenario which are summarized as follows: • Estimate the fee simple market value of the property assuming it is unencumbered as of the date of conveyance.

How to calculate the value of a property?

This method involves estimating the future net cash flow that can be generated from renting the property [1]. This would consist of annual rental income, less property taxes, maintenance and repair costs, as well as reasonable management fees.

## How can I find out the value of my inherited property?

One way to find out a property’s fair market value is to quickly put it on the market and sell it. And in some cases, that’s just what inheritors may want to do.

How do you determine the value of a life estate?

To determine the value of a life estate: First, find the line for the person’s age as of the last birthday. Then, multiply the figure in the life estate column for that age by the current market value of the property.

### What is the value of a life estate?

• find the line for the person’s age as of the last birthday.
• multiply the figure in the life estate column for that age by the current market value of the property.
• The result is the value of the life estate.

What is the remainder of a life estate?

A life estate is a type of property ownership, typically established by a deed, which is often used to avoid probate and immediately transfer property to an heir, or remainderman, at the time of death. The remainder is the future interest conveyed to the remainderman in the deed.

## What is a life estate table?

The life estate tables may also be used if the owners wish to sell the property and need to know how much of the net proceeds the client should receive or if the owners wish to purchase the life estate interest from the client.