Forests: a personal and confidential investment

Do you want to diversify your investment approach? Other types of investment exist and are profitable compared to passbooks and life insurance, although unusual. Forests can be a more beneficial source of return than others.

Why invest in a forest?

Investing in a forest, a refuge value? For investors, this natural resource has become a safe haven and a popular investment. In fact, the stock market price continues to rise while the price of the forest remains fairly stable. As a result, the evolution of the transaction on this asset has reached an exceptional level. Becoming an owner of a forest is very profitable, apart from contributing to the protection of the environment. However, a forest investment generates a more modest and long-term return. It is also important to know that owning a forest requires know-how and skills for its maintenance and management, otherwise the capital used can go up in smoke. The annual yield of a forest varies between 2 and 4% depending on its management, and depends on a few criteria (surface area, species planted, wood quality, etc.).

How to invest in a forest?

In general, the forest is a refuge value that allows you to secure your money and create an asset. To invest in it, various possibilities are available to you. You can directly buy a private forest estate, since public forests are not for sale, but managed by the State. You can therefore become an owner by directly acquiring the plot with all the advantages and risks it represents. However, there are also forest groups such as the GFF and the GFI that contribute to the constitution, improvement, equipment and conservation of the forest. The Société d’Epargne Foncière (SEF) is under the supervision of the Autorité des Marchés Financiers (AMF), and benefits from DEFI tax reductions or credits.

Advantages and risks of forest investments

The main risks of an investment in a forest are climate change (storms, hurricanes, cyclones…), fires, diseases… On the other hand, this way of investing money does not require a big investment, even if the price has doubled in a few years, about 4000 euros per hectare. In addition, you can benefit from a tax reduction of 25% on income tax when you buy land and 75% on real estate wealth (IFI), 18% reduction on the purchase price when you buy land.