Welcome to 2021, 4 real estate wishes to make

After happiness and health, safety will undoubtedly be the third most frequently expressed wish in 2021! Our need for protection is heightened by the obvious health risks we face, and by our exposure to a burdensome terrorist climate. However, we need to be confident about the future. Indeed, we need to pull together to ensure that 2021 turns the page on the somewhat anxious context that has characterized the year 2020. There's no doubt that we'll find this brighter future in the sure values that will improve our daily lives, protect our loved ones and give us more resources... A kind of antidote that will enable us to forget all the gloom of the past year and start 2021 with plenty of new projects. This magic potion is essentially composed of a material as noble as stone.
Whether it's for housing, capitalization, profitability or diversification, here are 4 good reasons to make a real estate wish. This dossier gives you a few ideas to help you get off on the right foot.

Happy New Year to all, thanks to your notary !

• Deeds signed remotely at the notary's office. The notary's profession has adapted to the new health situation by introducing a new tool for receiving notarized deeds when the parties are unable to be physically present when the deed is signed.

Wish n°1: buy my main residence

The health crisis we have just been through, with all its medical, social and moral consequences, calls into question our way of life. When it comes to housing, for example, it makes real estate a priority. What could be more reassuring than having a roof over one's head to feel safe and comfortable? In this context, the purchase of a principal residence is one of the most cherished wishes in 2021, especially as the sector still seems to be under the protection of the good fairies!
What are the right stars for buying? Notaires have a wide range of properties for sale in this magazine and on the immonot website. Particularly in medium-sized towns, where there is a good quality/price ratio compared with large conurbations. You should expect to pay between €150,000 and €200,000 for a 5-room house. Notaries are committed to appraising properties and offering them at the right price. This prevents them from being overpriced, as can happen when demand is high!
In addition to this dynamic market, there are a number of attractive incentives for financing or renovating a property. The zero-rate loan is of particular benefit to buyers interested in older property in semi-rural zones known as B2 or C.

• Simulation of a zero-rate loan: for a couple with 2 children (i.e. 4 occupants) buying a home in zone B2, if the total cost of the operation is €150,000, the maximum amount of the PTZ is €150,000 x 40% = €60,000.

In addition to this financial boost, the MaPrimeRenov' energy renovation grant gives you the opportunity to make your property more economical and comfortable at a lower cost. If you need to change your heating system, insulate your home, walls, attic or windows, install ventilation... this new bonus can be combined with Energy Savings Certificates (CEE), local grants and grants fromAction logement. Visit www.faire.gouv.fr for more information.

• MaPrimeRenov' demonstration:
  A couple with two children, earning €30,500 and owning a detached house in the Creuse region of France, is eligible for €15,900 in assistance. This will enable them to replace an old oil-fired boiler with a pellet-fired boiler at a total cost of €18,000.

Voeu n°2: invest in real estate

This health crisis must also lead us to protect ourselves against the hazards of the future. One solution isrental property. Not only does it enable you to build up assets on credit, it also allows you to supplement your income once the property has been paid off. More and more French people, including young people, are interested in investing.
Why make this decision?
Property is a safe investment, as shown by the fact that prices have risen by an average of 10% over the past 10 years. What's more, large cities are facing an unprecedented need for housing. The introduction of rent controls in Bordeaux, Grenoble, Lyon and Montpellier is a case in point. Buying a rental property offers excellent prospects.
What's more, rental properties benefit from attractive tax breaks under the Pinel scheme for new-build properties and the Denormandie scheme for older properties. These allow a tax reduction of up to 21% of the price of the property, provided it is rented for 12 years. In the case of older properties, renovation work must represent 25% of the total cost of the project.

• Case in point: for the purchase of an older home costing €150,000 with €50,000 worth of work, the assistance amounts to €42,000 for a 12-year rental period, i.e. a deduction of €3,500 per year.

• Should I buy or sell first? At the moment, it can be a good idea to buy properties first, as this opens the way for negotiations. This gives buyers back the upper hand, especially when sellers are unable to defer their sale.
  At least, this seems to be the view of 25% of notary correspondents to Tendance immonot du marché, whose advice is moving in this direction, compared with just 7% at the end of August.
  Source: Tendance immonot du marché - 11/20

Wish #3: make my home profitable

In the face of the economic crisis that is affecting us all, it's worth exploring the possibilities for conversion. Even more so for owners of properties in tourist areas. Seasonal rental of real estate can be a great way of doing business at a time when tourists are rediscovering their interest in traveling on French soil...
What opportunities in 2021?
The attractiveness of our regions should lead us to consider the advisability of creating bed and breakfast establishments, for example.
A little market research is needed beforehand to position yourself with an attractive offer. Let's not forget that the house must have a sufficient number of rooms, as each bedroom has access to a shower room and toilet. Tasteful decoration is also essential. As there is no official classification for guest houses, membership of a label is essential to reassure customers. According to Gîtes de France, a two-bedroom guest house generates average annual sales of €18,590.
The legal status of micro-entrepreneur is perfectly suited to sales of less than €72,500 a year for furnished rentals. It facilitates business start-up by reducing management formalities, with free online registration at autoentrepreneur.urssaf.fr. You need to declare your activity to the town hall, using Cerfa form no. 13566*03.

• Example of reconversion: this senior executive in a large company left her job to open a bed & breakfast in a building in the historic heart of the town of La Réole in Gironde (33) confides:
  "A demanding job, mobilizing old and new skills... for fulfillment beyond my expectations".
  The owner presents her La Parenthèse home at www.laparenthese-lareole.fr

Wish n°4: diversify my assets

Alongside traditional investments, there are real estate assets that are well worth a look, such as shops and parking lots. What's more, they're easy to manage and offer good returns.
Opportunities to be seized... A parking lot is an investment that allows you to be well parked, with an average entry price of €23,000 (source: Dossier Familial) and a gross profitability approaching 10%. In the case of an enclosed garage, the purchase price rises by around 20%. In this case, you'll need to pay close attention to the height of the doors, and the size of the space to accommodate vehicles such as SUVs or 4x4s. If this type of property is subject to co-ownership charges, the lease can be drafted very flexibly, as the rules governing apartment rentals do not apply. Rents are around €80 for a parking space in major cities, and around €100 in Paris. Boxes and garages rent for 25% more.

• Taxation: income from a parking lot or garage is taxable and must be declared as income from property. If annual rental income does not exceed €15,000, the micro-foncier system applies!

Good deals on services? Furnished accommodation is particularly attractive for senior citizens, students or business owners. Thanks to the LMNP status, investors benefit from the attractive tax advantages offered by the Censi-Bouvard scheme:

• acquisition in a serviced residence entitles you to reclaim the 20% VAT;
• until December 31, 2021, the Censi-Bouvard scheme offers a tax reduction of 11% of the value of the property (including notary fees), subject to certain conditions.

As LMNP income must not exceed €23,000, the micro-BIC system applies. An allowance allows you to deduct 50% of the sums received from your income tax.
What's more, this formula is ideal for relieving you of all the worries inherent in rental management.

• How much does an Airbnb-type rental earn? 90% of renters are individuals, and 79% of them have just one property. But this means that 10% of hosts are professionals and 21% of hosts offer several properties for rent.
  The average annual income of hosts (having registered at least one effective rental) is close to €6,500 over twelve months to the end of September 2020, or €544 per month. This corresponds to an average of 68 overnight stays per year.
  Source : www.lavieimmo.com

Christophe Raffaillac