The year 2024 is well underway and many people are wondering if it is time to start investing in real estate. Many factors come into play in determining whether now is the right time to invest, but rest assured: there are always good reasons to invest in real estate! Here are the top 5 reasons why 2024 could be a good year to invest in stones.
1. Reduction in interest rates
The reduction in interest rates at the beginning of 2024 is the main argument in favor of real estate investment.
Real estate loan rates are beginning to decline after historic highs that should continue in the coming months. You will be able to benefit from lower finance charges for your property loan and maximize the results of your rental investment.
This low interest rate environment also allows first-time buyers to carry out their purchase plans more easily.
With reduced monthly payments, banks are accepting borrowers’ files more often. This means that the real estate market will likely be driven by significant demand, which is favorable for investors.
2. Lower your taxes thanks to rental investment
Rental investments offer significant tax benefits that appeal to investors looking to reduce their tax burden. In 2024, several measures will significantly reduce your taxes:
- Pinal Law: This government scheme allows you to avail a tax deduction of up to 21% of your investment amount for a rental commitment of up to 12 years.
- Danormandy System: Aimed at landlords who carry out energy renovation work in old housing located in the city centre, it entitles them to a tax reduction (excluding tax) of up to €300,000 per year and 30% of the cost of the work for rent. 6 to 9 year commitment.
- Malraux System: It concerns real estate classified or registered as historical monuments and offers an income tax reduction calculated on the basis of the expenditure incurred for the renovation and restoration of the property up to €400,000 over 4 years.
- Loss of land: If you carry out repair, improvement or conservation work on a rental property, you can deduct these expenses from your property income and, in some cases, from your gross income.
Know the eligibility conditions for these schemes before you start to ensure that your investment meets the required criteria.
3. Constant rent demand
Before investing, check the rental demand in the area where you want to buy property. Many factors influence this demand:
- Demographics: An ever-increasing population requires housing to meet its needs.
- Local Economy: A dynamic employment pool attracts workers and thus creates long-term rental demand.
- Infrastructure: Development of public transport and proximity to essential shops are all arguments in favor of continued rental demand.
In 2024, the real estate market will undoubtedly continue to be influenced by rental demand, especially in big cities and tight areas.
Investing in these areas means ensuring the best occupancy rate for your accommodation and avoiding expensive long-term rental vacancies as much as possible.
4. Real estate prices that keep rising
Although property prices were relatively stable a few years ago, they are currently experiencing regular increases in many French cities.
This upward trend is expected to continue in 2024, especially due to the ever-increasing demand from buyers and tenants.
Long-term value added potential
Apart from the rental aspect, investing in real estate allows you to build solid assets.
Thanks to this gradual rise in prices, if you choose to sell after several years of ownership, you can resell your property with attractive capital gains. Thus, your investment not only brings you rental income, but also a potential profit on resale.
5. Diversification of your savings
Finally, investing in real estate will be a key asset to diversify your savings in 2024.
While returns on traditional financial products (savings accounts, life insurance, etc.) have been particularly low for many years, real estate offers profitability prospects that are often greater than these investments.
A wise choice in the face of economic uncertainties
Hence investment in real estate represents real interest as compared to other forms of long term savings. This is an effective way to protect your capital while generating regular income from property rentals.
Real estate is a tangible asset, making it a safe haven against fluctuations in financial markets.
So should we invest in real estate in 2024?
| for | in front of |
|---|---|
| SCPIs offer flexibility and opportunities, attractive returns and professional management. | Announced the end of the penal system in December 2024, questioning the future of tax incentives. |
| The Penal Law and the LMNP regime allow for tax benefits, tax reductions and reduced or zero taxation. | The real estate crisis of 2023 and rising interest rates affect purchasing power and credit. |
| The dynamism of certain regions and mid-sized towns, along with demographic and economic growth, favor rental demand and development opportunities. | A volatile market, with transactions and prices falling, limits opportunities for short-term capital gains. |
The year 2024 presents many opportunities for real estate investors. Whether it’s to take advantage of low interest rates, reduce your taxes, benefit from continued rental demand, capitalize on price increases or diversify your savings, it’s time to take action and make your project a reality.’ investment.
