The expiry date of the tax-friendly government bonds is fast approaching. Perhaps you’ll get a nice sum back too. Have you thought about how you want to re-invest that money smartly? By investing in real estate, you are choosing an investment with attractive benefits that is also inflation-proof.
The expiry date of the tax-friendly government bonds is fast approaching. Perhaps you’ll get a nice sum back too. Have you thought about how you want to re-invest that money smartly? By investing in real estate, you are choosing an investment with attractive benefits that is also inflation-proof.
Government bonds: background
These government bonds were issued by the Belgian government. The government borrows money from individuals and institutions to pay off its debts. In return, of course, the government repays the amounts it borrows, with periodic interest on top.
The 2023 government bond was an unprecedented success. A total of over €22 billion was subscribed. This one-year bond will expire on 4 September 2024. The money thus freed up offers new smart investment opportunities. In new-build properties, for example.
The benefits of a government bond
A government bond is a smart, safe and accessible investment. Even with a more limited amount and over a shorter term - 3 to 10 years - it offers interesting opportunities. Moreover, you can resell earlier than the maturity date, receive a fixed coupon rate and have a tax benefit. So this is a stable and predictable form of income.
Real estate as an interesting (re)investment
With the expiry of the 2023 government bond, you too may be actively looking at reliable and profitable ways to put your money back to work. A real estate investment bears many parallels to investing in a government bond. Moreover, unlike the government bond, a real estate investment has no inflation risk.
- It is a safe investment. The value of a property increases while the repayment capital remains the same.
- You enjoy fixed income, which does not decrease much, if at all. Rents in Flanders have risen by around 30% in the last 10 years.
- Housing can be traded. So you can sell your property at any time, even with a current lease.
- Belgium is one of the few countries where private rental income is not directly taxed. That means an interesting tax benefit.
- The scarcity in the rental market gives security of income if you charge market rents.
Buying a new-build property to rent
However, investing in real estate requires a bigger budget. Of course, you can skim the renovation market. Still, considering a new-build home is a good idea. You avoid age-related repairs and headaches, and go for an attractive rental property. Because modern technology, low maintenance and energy efficiency appeal to every prospective tenant. By the way, did you know that Potrell will find your first tenant for you? Free and professional.
Value-added project developer
At Potrell, we like to create added value. So you too will get more out of your budget. And you may take that even more literally in September. If you want to reinvest the amount invested and the return on your government bond in our property, we will gift you an extra 5,000 euros of finishing budget.
More information?
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