A furnished apartment that generates regular rents, a tax system that allows for reducing taxation on this income, and yet, the net yield remains disappointing. The problem rarely lies with the property itself. It is in the way rental management is organized, between tax choices, monitoring of charges, and exit strategy. The LMNP status offers concrete levers to improve the profitability of a furnished rental investment, provided they are activated at the right time.
LMNP Depreciation and Capital Gains: The Rule That Changes the Resale Strategy
For years, the real regime in LMNP allowed for the depreciation of the property and furniture without tax consequences upon resale. The calculation of capital gains ignored the depreciations applied. That era is over.
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Since February 15, 2025, depreciations must be reintegrated into the calculation of capital gains for certain furnished rentals. Concretely, the acquisition price is reduced by the total amount of depreciations deducted before being compared to the sale price. The taxable gain mechanically increases.
A property depreciated over ten years shows a fiscal acquisition price much lower than its actual purchase price. This is exactly the mechanism that can inflate the bill at the time of sale.
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Several approaches can limit the impact: extending the holding period to benefit from progressive allowances, or deciding between resale and transmission. Those who wish to delve deeper into the subject will find detailed elements on LMNP rental management on Capitaine Immo, particularly on the relationship between depreciation and holding horizon.
A common mistake is to maximize annual depreciations without ever modeling the resale scenario. Optimizing the real regime requires planning the exit from the very purchase.
Real Regime or Micro-BIC: Choice Criteria for Rental Profitability
The micro-BIC applies a flat-rate allowance of 50% on rental income for long-term furnished rentals. The real regime allows for the deduction of actual charges and the depreciation of the property, furniture, and acquisition costs.
Why does this choice matter so much? Because the difference in taxation between the two regimes can represent several thousand euros per year, depending on the property profile and the level of charges.
When Micro-BIC is Sufficient
If your actual charges (loan interest, repairs, insurance, accounting) remain below half of your rents, the micro-BIC remains competitive. It avoids accounting fees and simplifies the tax declaration.
When the Real Regime Becomes Profitable
As soon as charges and depreciations exceed the flat-rate allowance, the real regime further reduces the taxable base. This is often the case in the early years when loan interest is high and the depreciation of the property is based on its full value.
- Loan interest: fully deductible under the real regime, they weigh heavily in the first years of the loan.
- Accounting fees: mandatory under the real regime, they are partially recoverable via a tax credit for members of an approved management center.
- Maintenance and repair work: deductible in the year they are carried out, they help smooth out taxation.
The real regime generates a carryover deficit that can neutralize tax on rents for several years. This deficit carries over to the same category profits (non-professional BIC) for the next ten years.
Furnished Rent and Vacancy Rate: Often Overlooked Operational Levers
Taxation captures all the attention. However, rental yield also depends on daily management: the rent level, tenant turnover, and vacancy periods.
A rent set too high compared to the local market extends the vacancy duration between two tenants. A rent too low reduces the gross yield. The right rent is one that minimizes vacancy while remaining consistent with the furnished property’s offerings.
Reducing Rental Vacancy Without Lowering Rent
The quality of the furnishings plays a direct role in the property’s attractiveness. A furnished apartment with functional and well-maintained furniture rents faster than an under-equipped unit, even at the same rent.
Some practical practices:
- Photograph the property with natural lighting and tidy rooms, as most tenants filter listings based on visuals before reading the description.
- Renew worn furniture before it generates disputes or requests for rent reductions (these expenses are deductible under the real regime).
- Publish the listing at least six weeks before the end of the current lease to avoid any period without a tenant.
Each month of vacancy removes one twelfth of the annual income. On a rental investment financed by credit, this lost month turns into a monthly payment paid out of pocket.
Reporting Obligations: What the LMNP Owner Must Anticipate
For owners managing multiple properties, rigorous tracking of deadlines becomes a full-fledged management task. Some choose to delegate this administrative part to a manager or an accountant specialized in furnished rentals, which incurs a cost but limits the risk of forgetting or errors.
The LMNP status remains an effective tax framework for furnished rental real estate investment. Its profitability depends less on the chosen regime than on the coherence between the tax strategy, the operational management of the property, and considering exit taxation from day one.