Finances continue to dominate concerns in retirement age as inflation, escalating healthcare costs and longer life expectancies place a severe drain on pension funds. According to a recent Moneyweb article quoting the 2017 report by Sanlam Glacier, for a 65-year-old couple today, there is a 50 percent chance that one will live to the age of 94, and a 25% chance that one could live to the age of 100. In order to maintain a quality standard of living while remaining within budget, it’s important to make sound financial decisions – particularly with big investments.
“Retirement is supposed to be a time to indulge in personal interests and long-held dreams, without the daily stress that accompanies working life,” explained Phil Barker, managing director of Renishaw Property Developments, developers of Renishaw Hills. “This is why Renishaw Hills adopted the unique Reversionary Transfer Obligation (RTO) model as the best fit for both retirees and developers.”
Alongside the RTO model, Renishaw Hills does offer investors the sectional title model, however the RTO option is much more accessible to those looking for benefits now rather than profits at a later stage. Renishaw Hills has recently included more RTO units as a limited offer, to meet the market demand for access to such high-calibre units.
The RTO contract provides a significant discount upfront for the investors. Unlike with traditional sectional title, on disposal of the unit, the developer is given first option to purchase the home back at the original price. At Renishaw Hills, owners are offered a significant discount on certain free-standing houses and on maisonettes– up to 20%. This solution is a great fit for those wanting to enjoy a high-quality lifestyle with all the associated estate benefits including high-end security and various on-site facilities and services.
Benefits of the RTO
1. Enjoy a quality lifestyle now
The RTO option is ideal for retirees who want a quality lifestyle at a discounted price now, rather than waiting for property values to increase in the future. This pricing option means there is no loss made, rather investees get to enjoy the value of a property currently, rather than later in life. For those investing in what is to be a lasting home, the RTO is the perfect option.
2. The developer remains invested
With the sectional title model, the developer is under no obligation to remain invested in the development after the sale. However, with the RTO model, the developer will most likely regain ownership of the property so there is a vested interest to maintain the property to the highest standard. It’s a win-win for both owner and developer.
3. No hassles for the next generation
Modern living often means families of South African couples are residing internationally. Rather than leaving children a property sale to contend with, RTO model means parents are opting to set money aside for inheritance and investing in a life-long retirement home. This also provides children with peace of mind, knowing their parents are living their best life in a safe, quality retirement estate.