Property income certificate

Interested in investing in bricks and mortar … provided there is no hassle? The Property income certificate is ideal for you.

What are Property income certificates?

A property income certificate is a debt security drawn on a company that owns real estate. You are therefore entitled to part of the loan and of the net proceeds of the sale of the property.

Advantages

  • Potentially high return: The value of your investment will rise if the value of the property rises, and you will also get a large coupon.
  • No practical problems: you invest in the property, but you do not have the worry of its rental or sale.
  • No withholding tax on part of the coupon. you do not pay withholding tax on capital repayments in line with depreciation of the building.
  • Excellent protection against inflation: since it is based on indexed rent, the coupon is index linked.
  • Easily transferable.
 
 

Get full details

As a certificate holder, you receive a regular coupon (in principle once a year) paid from the indexed rent collected by the company and from its the financial investments. The coupon generally consists of two components:

  • The “profits” component, on which there is 25% withholding tax.
  • The “capital repayment” component, calculated in line with depreciation of the building and on which there is no withholding tax.
  • The Property Income Certificate has a fixed term, frequently 20-25 years.
  • The term corresponds to the sale of the property.

Most property income certificates are listed on the Brussels unlisted securities market. The price at which property income certificates are traded is fixed each day. This price is determined on the basis of supply and demand.


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