Bare ownership (split ownership)
The residual ownership right held by the bare owner after usufruct has been transferred to a third party. The bare owner has neither use of the property nor the right to collect its income during the dismemberment period, but recovers full ownership upon expiry of the usufruct at no additional cost. This structure allows acquiring a property at a reduced price (typically 50–70% of full-ownership value) and optimises estate planning.
Key points
- Purchase price typically 50–70% of full-ownership market value.
- No rental income received and no management costs borne during the dismemberment period.
- Full ownership is recovered at no extra cost when usufruct expires.
- Property excluded from the bare owner's IFI tax base throughout the dismemberment.
Frequently asked questions
What is the benefit of buying bare ownership for a property investor?
The buyer acquires a property asset at a discounted price, without rental management hassle or immediate tax pressure. When the dismemberment ends, they recover a valued property that can be let or sold. It is a long-term capital-building strategy, particularly effective for retirement planning.
How does a bank finance the purchase of bare ownership?
The bank factors in the absence of rental income during the dismemberment period when assessing repayment capacity. The broker must explain the structure and present other income sources or assets to reassure the lender.
What is the difference between buying bare ownership and investing in SCPI units on credit?
Bare ownership concerns a specific physical property with a purchase discount and future capital gain but no immediate income. SCPI units on credit generate dividends from the outset but involve a different liquidity risk. The broker compares the two according to the client's tax and wealth profile.
In practice
An investor buys the bare ownership of a flat for €140,000 while its full-ownership value is estimated at €220,000. For 15 years a social landlord holds the usufruct; at the end of that period the investor recovers full ownership at no extra cost.
Official sources
- Usufruct, bare ownership, full ownership: differences · Service-Public.gouv.fr
- Housing and financing information · ANIL
- Mortgage credit (official guide) · Service-Public.gouv.fr