Updated : 02/08/2026
How to Analyze a French Viager Investment
A serious viager analysis rebuilds all cash flows over time - bouquet, fees, indexed annuity, charges, optional rent and net resale - then tests several life-expectancy scenarios before calculating Internal Rate of Return (IRR) and NPV. An advertised yield on the listing is rarely enough on its own.
In short
- Viager returns depend on bouquet, indexed annuity, longevity, charges and net resale - not the headline price alone.
- Occupied vs free viager changes rental cash flows completely.
- Life expectancy is a modelling assumption, not a prediction.
- IRR shows an implied annualised return; NPV shows value created vs your hurdle rate.
- Use a viager calculator and test several scenarios before investing.
In this article
- What to model
- Bouquet
- Life annuity
- Occupied vs free
- Life expectancy
- IRR and NPV
- Common mistakes
- FAQ
- Key takeaways
What to model in a viager analysis
A viager investment analysis should answer one question: does this property meet your required return under realistic assumptions?
Typical workflow:
- Confirm the viager type (occupied, free, bare ownership).
- Map all future cash inflows and outflows over time.
- Test several life-expectancy scenarios.
- Calculate total cost, gain, IRR and NPV.
- Compare alternatives - including a conventional rental purchase if relevant.
Analyze this property in minutes with Le Bon Viager's calculator: IRR, NPV, cash flows and multiple longevity scenarios.
Bouquet
The bouquet is the upfront capital paid at signing. It is part of the purchase price, not a fee.
| Question | Why it matters |
|---|---|
| How much cash do you need at closing? | Liquidity and financing |
| Bouquet vs full ownership value? | Context for the discount - not proof of profit |
| Notary fees included in your plan? | Often forgotten in quick comparisons |
A lower bouquet reduces initial cash but does not reduce total uncertainty if the annuity is high or longevity long.
Life annuity
The life annuity (rente viagère) is the periodic payment to the seller — usually monthly, often indexed.
| Element | Impact on viager analysis |
|---|---|
| Monthly amount (year 1) | Starting cash outflow |
| Indexation clause | Can dominate total cost over 15-20 years |
| One life vs two lives | Second death can extend payments |
| Who receives payments | Seller directly - not a bank |
The annuity is not a mortgage instalment. Your bank loan (if any) typically covers only the bouquet, not the seller’s annuity.
Occupied vs free viager
| Occupied (DUH) | Free (libre) | |
|---|---|---|
| Seller occupies? | Yes | No |
| Buyer can rent? | No (while seller occupies) | Yes, from signing |
| Typical cash flow | Annuity out, no rent in | Annuity out, rent possible in |
| Use case | Long-term wealth / resale play | Investor / immediate use |
Two properties at the same displayed price can produce opposite cash-flow profiles. Never compare viager investment returns without the type.
Life expectancy
You do not know how long the seller will live. Life expectancy in a viager model is an assumption, not a forecast.
| Scenario | What changes |
|---|---|
| Shorter than expected | Lower lifetime annuity payments - potentially higher returns |
| Central case | Base IRR / NPV |
| Longer than expected | Higher lifetime annuity payments - potentially lower returns |
Always run at least three scenarios. A viager calculator that only uses one lifespan gives a false sense of precision.
IRR and NPV
IRR (Internal Rate of Return)
IRR is the annualised implied return that equates all cash flows over time. In viager, it depends heavily on:
- when money goes out (bouquet, annuity, charges),
- when money comes in (rent, net resale),
- how long the seller lives in your scenario.
NPV (Net Present Value)
NPV expresses the result in today's money using your chosen discount rate:
- NPV > 0 - the scenario beats your hurdle rate (still not a guarantee).
- NPV < 0 - the scenario falls short on your assumptions.
IRR and NPV answer different questions. Use both in any viager analysis.
Common mistake
Judging a viager only by “discount to market value”. A lower price often reflects delayed enjoyment, occupation rights or higher risk - not automatic profit.
Common mistakes
- Trusting an advertised yield without indexation, charges or longevity.
- Comparing occupied and free properties on headline price alone.
- Using a single life-expectancy guess instead of a range.
- Ignoring property tax, charges and major works borne by the buyer.
- Confusing no bank loan with no financial risk.
- Making an offer before running IRR, NPV and scenario analysis.
- Forgetting that resale of viager rights may take time and depend on market conditions.
FAQ
What is a viager calculator?
A tool that turns property inputs (value, bouquet, annuity, seller age, viager type) into score, IRR, NPV and longevity scenarios. Le Bon Viager is built for this — free, no account required.
What is a good return on a French viager?
There is no universal figure. A “good” viager investment depends on your hurdle rate, the viager type, location, indexation and how long the seller lives in your scenarios.
Can I analyze viager from outside France?
Yes. Remote viager analysis is the recommended first step before travel or notary contact — especially for non-residents.
Do IRR and NPV guarantee performance?
No. They show what happens if your inputs and assumptions materialise. They are decision tools, not promises.
Key takeaways
- Viager analysis = full cash-flow timeline + multiple longevity scenarios.
- Bouquet and indexed annuity are the core outflows; type determines rent.
- Occupied vs free viager is not a detail - it changes the entire model.
- IRR for annualised return; NPV vs your hurdle rate - use both.
- Analyze this property in minutes with Le Bon Viager's calculator.
Informational content only — not legal, tax, financial or investment advice.