Tax-driven property investments are not advisable.
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Importance of taxes
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Taxes are important, but are by no means the primary criterion for the decision to acquire property generally
- e.g. acquisition of properties that require renovation to increase investment costs and reduce capital gains tax on property
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It is preferable to place the “emphasis” on the location, purchase, management and selling price, rather than making an acquisition based solely on the tax aspect.
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Tax avoidance requires a (taxable) profit first of all!
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It would consequently be illogical and disadvantageous to give the tax aspect priority over the terms and conditions aspect.
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Private investors are occasionally too emotional and too opportunistic in this regard.
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- Tax certainty
- The half-life period of tax regulations has become considerably shorter and hence legal certainty for property investors who are liable to pay taxes
- Property investments are usually long-term commitments, which is why it is often impossible to react quickly enough to tax adjustments (e.g. sale while taxes are lower is not possible due to the market situation (property slump), such a buyer needs time, only someone who has time is able to sell and obtain a good selling price, etc.)
