Are SCPIs right for you?
The SCPI (Sociétés Civiles de Placement Immobilier) meet many objectives and asset situations.
Indeed, they allow to generate potential income by diversifying one's assets. For young investors, they also offer the opportunity to invest indirectly in real estate without a significant contribution.
At 30 years old, the SCPI to launch out in the real estate with little contribution
SCPIs are a long-term investment, at least 10 years. You can therefore be interested in them at a young age, as soon as you start working. Moreover, you do not need to have a large budget: shares are generally available for only a few hundred euros. Some management companies have even set up programmed payments that allow you to build up your capital at your own pace.
If you want to build up your real estate assets more quickly, you can invest on credit, as with any real estate investment. Initially, the potential rents can be used to repay all or part of the monthly payments. Then you can use them as you wish. Nevertheless, a loan commits you and must be repaid. Since the SCPI's income is not guaranteed, check your ability to repay before committing yourself. Indeed, if the income from the SCPI is less than the loan repayments, you will have to pay the difference. Moreover, in case of resale of your units, the capital received could be insufficient to repay the loan and you would have to pay the difference. Finally, it is important to remember that SCPIs present a liquidity risk and the resale of units is not guaranteed.
At age 50, SCPIs to boost your assets
Do you already own your primary or secondary residence, or even a few rental properties? Acquiring SCPI units will allow you to diversify into commercial real estate and benefit from its potential returns. This collective investment solution allows you to pool the risks of rental vacancy or unpaid rent. For a fee, the management of the property is delegated to a team of asset managers in charge of selecting properties and tenants, collecting rents, managing works... A facilitated management when you have a large portfolio to manage.
Please note: If you want to limit the taxation on the income paid by the SCPI, you can place your shares in a life insurance contract or in a SCI (Société Civile Immobilière) taxed at IS (Impôt sur les Sociétés). You should first check your personal tax situation with your usual advisor.
At age 65, SCPIs as a transmission tool
The transmission of your estate is simplified because you can divide the portfolio of SCPI units into several identical units for each beneficiary. In addition, it is easier to gradually give away shares in a company than a property held "directly". This also allows you to optimize the allowance on gift taxes. Renewable every 15 years, it reaches 100.000 euros between parents and children and 31.865 euros between grandparents and grandchildren.
As a reminder, investment in SCPI shares carries a risk of capital loss due to changes in the real estate market. Income is not guaranteed and can vary both upwards and downwards depending on the performance of the fund. The SCPI is a long-term investment with a recommended investment horizon of 10 years. Liquidity is limited, the management company does not guarantee the resale of units. And as with any investment, past performance is no guarantee of future performance.
It is advisable to contact an advisor who will propose a solution adapted to your situation and your financial objectives. Before subscribing to any SCPI, you must consult the key information document, the prospectus, the articles of association, the subscription form, the latest quarterly information bulletin and the latest annual report of the SCPI concerned. For Primonial REIM France SCPIs, these documents are available on the website www.primonialreim.fr