Want to invest in real estate?
Consider investing in SME real estate.

The main advantages of investing in real estate

Much more interesting? To invest in real estate. This often involves buying residential property (flats, service flats, student quarters) as we know it or even investing through listed property companies.

Investing in real estate has many advantages:

• Investing in real estate is generally considered safe. True, property prices can fluctuate – but in recent years, property prices have risen year after year, often outpacing inflation. As a result, real estate holds its value very well or becomes worth more.
• Besides rising property prices: real estate as an investment also generates a regular income stream. At least, if you rent out the property. Moreover, rents are indexable, which also protects your income stream from inflation.
• Of course, with an investment demand also comes a return demand. And a number of factors determine that last one. Whether your investment is in new construction or not, its location, but also temporary vacancy and costs to let the property… They all play an important role in determining your rental return. You can however count on a realistic net return between 3% and 5%.

Of course, investing is not just made up of benefits.  Investing in (commercial) property is a long-term business and there are purchase costs involved such as registration and notary fees – making it a less liquid investment.

Commercial real estate: investing without worries

Have you considered investing in SME units yet? While investing in SME units, you are investing in business property but with lower entry barriers than – for example – investments in logistics, retail or even office property (which are also part of the business property category)… Many business owners invest in their own modern and sustainable base of operations. But do consider investing in them for rental options as well. Especially as the SME units developed by BVI.EU enjoy a very high degree of modularity and flexibility – they’re ideal for renting out. Maintaining the value of this type of property on one hand is easy,  and the demand on the rental market for a high-quality, sustainable base for businesses continues growing.

Renting your property to professional tenants also has its advantages:

• property tax is paid by the tenant
• management costs are paid by the tenant
• as an owner, you have less maintenance in an SME unit than in a flat

Taxation

With any investment, taxation plays its role. This is no different when investing in commercial real estate. What is important to know is that the actual rental income is taxed – a big difference from renting out residential property. So investments are often made in commercial real estate through a company in order to benefit from depreciation, VAT recovery, since 2019 it is also possible to charge VAT on property rentals for new construction.

On the other hand, there is of course the fact that when real estate is sold from the company, the capital gain will be taxed. So seek adequate advice.