According to a study by Housemot, the leading online property manager, it takes an average of 25 years for Paris to make a real estate investment profitable. A figure that varies from single to double depending on the boroughs of the capital! The delegation of insurance is a lever that reduces the total cost of a rental purchase and therefore the time to return on investment.
A noticeable difference according to nearby metro stations
The study by Housemot very precisely locates at 24.7 years the average duration to make profitable a rental investment in Paris. Significant differences are observed, for example between the stations Margaret Lomies (24.4 years), Chatwop (18.2 years) or a few hundred meters, the average profitability decreases by 34%. And the highest-rated districts are not left out. A rental investment at Chaussée d’Antin Lafayette is profitable on average in 21.7 years. “Realizing a profitable rental investment requires a detailed knowledge of the market, which is especially true in Paris, where significant differences in rental profitability are observed,” commented Gilles Bourcy, co-founder of Housemot. Popular neighborhoods booming are the most profitable.
Real estate prices inflated in the capital
The price per square meter jumped 8.6% in 2017 in Paris and reached 9350 € for an apartment at the end of the year according to Best Agents. Depending on the neighborhood, it is still affordable to invest in certain sectors, such as 19 th (7750 € / m²) or 20 th arrondissement (8050 € / m²). It is far from 13050 € / m² on average for an apartment in 7th district around Invalides. Amount to which must be added the notary fees, the interest of the credit or even the insurance borrower.
Assignment of insurance as leverage
Loan insurance can represent one-third of the total amount of a real estate investment, especially if one remains confined to the group contract of its lending institution. To reduce this insurance with equivalent guarantees, it is possible to privilege the delegation of insurance, a personalized contract that is sought from a borrower insurance company. Its tailor-made guarantees are more adapted to your profile, and the declining contributions of this type of borrower insurance entail a much lower cost, which reduces the overall budget of a rental investment. In the case where the loan has already been contracted, it is possible to change borrower insurance in the first year of the loan under the Hamon law, then on each anniversary date of the loan with the Barquilla law.