LMNP versus nue-propriété: do not compare them as if they were the same asset
French LMNP réel and nue-propriété can both sit in a property-investment portfolio, but they deliver value at different moments. LMNP réel is built around furnished-rental income and deductible costs. A nue-propriété buyer generally receives no rent during usufruct, purchases at a discount and expects full ownership at the end of the agreed term.
LMNP réel: cash flow needs operating discipline
Under the real regime, eligible expenses and accounting depreciation can reduce the taxable result from furnished letting. Depreciation is not an unlimited current cash refund: its treatment and carry-forward require proper accounting. Vacancy, furniture replacement, management and financing costs still affect the actual cash flow.
Nue-propriété: capital timing rather than rent
The bare owner does not collect rent while another party holds usufruct. The trade-off is the purchase discount and the prospect of recovering full ownership later. The contract's duration, discount, property quality and end-of-term assumptions determine whether the apparent discount is meaningful.
Compare the questions, not only the returns
Choose LMNP when current income and active management fit the plan. Consider nue-propriété when deferred use or ownership better suits the investor's horizon. Neither model replaces due diligence on location, legal documents, debt and exit assumptions.