With a life annuity, you sell your property in Munich and receive the equivalent not as a lump sum, but as a lifelong monthly payment — optionally combined with a partial payout. You continue to live rent-free, the right of residence (Wohnrecht) is registered in the first priority position in the land register (Grundbuch), and termination due to owner-occupation (Eigenbedarfskündigung) is excluded.
AI generatedAsking prices in Munich are around 10.450 €/m² for condominiums and 9.850 €/m² for houses, with the comparable rent around 21.80 €/sqm (as of 2024, source: Immobilienmakler München Starnberg). Both feed directly into the calculation: the market value determines the total entitlement, while the local rent determines the capital value of your right of residence, which is deducted from it. Figures for your location can be found in the Market overview Munich.
Condominium in Munich, market value 850,000 €, beneficiary 75 years old, annual rental value 4 % (34,000 €). According to §14 BewG, the capital value of the right of residence (Wohnrecht) is approximately 383,000 €, leaving about 466,000 €. If 50 % of this is paid out immediately, the remaining approximately 233,000 € with a statistical remaining life expectancy of 12.7 years results in a monthly life annuity of about 1,530 € — in addition to rent-free living worth approximately 2,830 € per month.
Non-binding estimate according to §14 BewG and mortality tables 2020/22 (DESTATIS). The binding offer depends on location, condition, rental value appraisal, and investor.
Six example scenarios illustrate how differently a life annuity can be structured.
A single owner wants to increase her regular income permanently. The life annuity is calculated so that her right of residence remains protected in the land register and the monthly payment supports her everyday budget.
Key point: protect payments and define annuity adjustments in the contract.
A couple first needs funds for age-friendly alterations and then wants lifelong supplementary income. A combined solution divides the available value between an initial payment and monthly amounts.
Key point: account correctly for both beneficiaries and their lifetimes.
An owner may later move into assisted living. The contract therefore specifies in advance how a voluntary move affects the right of residence and annuity payments.
Key point: agree a clear compensation or increase clause.
A couple of different ages wants the surviving partner to remain financially secure. The calculation therefore accounts for both people and specifies whether the annuity continues unchanged after the first death.
Key point: define the payment term and the surviving partner's rights.
A small property loan is to be cleared before monthly annuity payments begin. The required lump sum is deducted from the available capital and the balance is converted into a lifelong payment.
Key point: coordinate release of the charge and repayment with the financing bank.
An owner wants a lifelong annuity while also protecting relatives if she dies early. A guaranteed payment period is compared with a higher annuity that has no minimum term.
Key point: balance protection for beneficiaries against the achievable annuity amount.
Illustrative, anonymised case scenarios. They are provided for guidance and are not customer reviews.
About the author
This content is the responsibility of Michael Freitag, founder of FREITAG® Immobilien GmbH, based in the Munich & Starnberg region. The sample calculations on this page are simplified and do not replace an individual valuation or tax and legal advice.
Legal basis & sources
Managing Director of FREITAG® Beteiligungsgesellschaft mbH
Every consultation starts with sober figures, not with a promise: what is your property worth, what is your right to stay worth, what is left for you? Gerhard Hahn has been holding these conversations personally for more than three decades — no call centre, no changing contacts.
