How to make a successful rental investment in Mauritius?
A rental investment in Mauritius cannot be improvised and requires arrangements to be made before investing. It is necessary to know the rental market, but also the tax system and the most suitable financing for the acquisition of a property in Mauritius.
First of all, it is essential to define one's objectives, but also to be realistic and accept that rental income in Mauritius is still modest. If you are an investor looking for a return on your investment, investing in a rental property in Mauritius will not always meet your expectations. With prices having increased by an average of 5% per year over the last decade, the average net return is only 3% to 4%. On the other hand, if you are a "lifestyle investor" looking for a tropical lifestyle, don't hesitate to invest in Mauritius!
Mauritius distinguishes on the real estate market between Mauritians and foreigners. From a studio in a smart city, an apartment in R+2, a villa in a private PDS domain, to a prestigious waterfront villa, the market offers a wide variety of housing for foreigners to invest in. Namely, most foreigners who buy on the Island do so on plan, for sale in the future state of completion (VEFA).
The political and economic stability of the country as well as the mode of acquisition very close to the French system make buying in Mauritius secure. Inherited from the Napoleonic Code, the Mauritian legal system is also close to French law. The legal documents are written in French and one has to go through a notary to finalize a real estate transaction.
If you wish to rent your property on a short term basis, it is interesting to entrust your property to a reputable agency for rental management. Concerning long-term rentals, the arrival of more and more expatriates detached from their companies, retirees or entrepreneurs leads to a growing demand for long-term rentals, which is therefore also an interesting and lucrative option.
Finally, investing in Mauritius is very attractive due to its low taxation in terms of land investment. Construction cost per m2 lower than in France, no property tax or housing tax, no CSG RDS, no capital gains tax or inheritance tax, investment deducted from the IFI base for residents, property taxes capped at 15% and a non-double taxation agreement with France, all these criteria make rental investment in Mauritius attractive, and definitely make it a successful investment.