We often hear about investing in real estate but what is the best solution? It depends on each person, so here are a few things to help you understand.

Investing in the Pinel law and Pinel Plus

The year 2023 marks the beginning of the end for the Pinel law. Indeed, from 1 April 2023 the tax reduction rates that we have known since 2014 will be reduced. At the end of the period which runs until 31/03/2023, the reduction rates which were previously :

• 12% for a 6 year commitment,
• 18% for a 9-year commitment,
• 21% for a 12-year commitment,

will increase to 10.5%, 15% and 17.5% respectively. For the year 2024 these rates will be further reduced to 9, 12 and 14%.

In addition, the government will still allow you to benefit from the rates applied until now, the so-called "Pinel plus" law. In order to benefit from these tax reductions, in addition to the main conditions to be met in order to benefit from the Pinel scheme, it will be necessary for the property to be located in a priority district of the city policy or if it meets a high level of quality in terms of energy performance, use and comfort.

Investment in furnished rental accommodation

With the end of the Censi-Bouvard scheme on 31 December 2022, the acquisition of a rental property under the furnished rental scheme can be done in two different ways. The first consists of the acquisition of a property that the owner furnishes himself and that he puts up for rent. The second solution is to buy a property that is part of a managed residence. When the purchase is signed, a management contract is signed with the company that looks after the occupants and the common areas. This company signs the lease with the purchaser and undertakes to pay a predefined rent for a specific period.

Buying shares in SCPIs

Another solution is available to investors, namely the purchase of SCPI units. This is indirectly a purchase in the real estate sector, since in this case the client becomes a shareholder of the Société Civile de Placement Immobilier (SCPI). This structure holds real estate assets that can be of different kinds. It is possible to find offices, business premises, warehouses, even hotels and nursing homes. They may be located in France or abroad, but in both cases there are tax implications to consider.

Whichever solution is chosen, it is important to master all the legal, financial and tax consequences. For this, it is essential to be accompanied by a specialist. Wealth A7, a wealth management firm for over 15 years, can advise you, contact us!

In a changing world, Wealth A7 is there to bring your wishes to life.