Investment in oil, which is a capital and decisive value on the stock markets, is well known. On the other hand, investment in the forest, which is a safe haven, less sensitive to economic shocks, is little known to the general public (just like investing in a village house or even in a cow!). However, the forest is a raw material, an investment asset characterized by an accessible price in an economic and favorable context, with non-negligible returns. Investing in a forest can thus be an interesting operation that deserves to be looked into knowing how to invest and why to consider it.
To invest in a forest, there are three options: the direct purchase of a plot of forest, the purchase of shares in a forest land group or the purchase of shares in forest savings companies.
A forest is a large expanse of land covered in trees. It is often transmitted during an inheritance and thus allows an heir to own a plot of wood or forest. For any investment in the forest, it will therefore be necessary to purchase a private forest estate from a landowner. It is therefore a question of buying a forest.
The purchase price, which is negotiated on average per hectare, varies according to yield prospects. As this good is transmitted from generation to generation, this market, which is difficult to access, is somewhat confidential. It is sometimes necessary to turn to an intermediary or the Land Development and Rural Settlement Companies (Safer) to easily find land for sale and to buy it.
A Groupement Foncier Forestier is a company which makes it possible to invest in the forest; it makes it possible to acquire a wooded area by subscribing or acquiring its shares. It is about investing in the forest by buying only shares. The forest land grouping thus constitutes an alternative to the direct purchase of a plot of forest.
Investment in the forest can be made through forest savings companies (SEF), investment companies, with the aim of acquiring and managing forest assets. These companies relieve the investor of all management concerns.
Forestry investment is a profitable and safe investment that sometimes offers a non-negligible additional income. With the production of wood, the investor can have a regular and renewable source of income. The exploitation of the forests, the cuts and the rental of wooded areas for hunting, make it possible to obtain profitability.
There is a good overall return on invested capital with very low risk taking; most of the risks related to bush fire or storm being covered by insurance. This investment is a long-term investment. It does not provide immediate capital gains or large short-term income, but wood is a reassuring asset that allows investors to diversify their assets and portfolio.
Investing in the forest offers many tax advantages. It allows the investor to benefit from an 18% reduction in income tax. Taxation is thus very attractive in terms of income tax when buying the forest. In addition, forestry investment, through a forestry group, offers a reduction in income tax and wealth tax depending on the amount invested. Exemptions from inheritance tax also prevail under certain conditions.
A reduction of 75% will be applied for the calculation of gift and inheritance tax, when the owner plans to transfer his forests. The investor thus transmits his wealth at a lower cost, declaring only 25% of the value of the property. This investment in the forest thus constitutes a substantial reduction in the solidarity tax on wealth (ISF).