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Using your own property as an investment: is it wise to invest my money in bricks and mortar?

What should I do with my (considerable) wealth? Anyone who is able to ask this question, and is on the lookout for the most stable investment options – i.e., those that increase in value – soon thinks of property. The money markets – everything from classical equity securities to speculative crypto markets – ‘impress’ us only by their high volatility, while the ‘interest’ on low-risk investments is hardly worth mentioning. And if you are already looking for your own house or flat anyway, you will inevitably ask yourself: Why not just go ahead and buy it, keeping its increasing value at the back of my mind to reassure myself?

Three essential questions before you start: Do I want to use it myself? Do I have enough capital? Is it in my own interest?

In principle, property is a long-term, stable investment. But a few things need to be considered if the equations ‘buy + let = earn money’ – or even ‘buy + renovate + sell = earn really big money’ – are to work out even approximately right. This is where it helps to consider the above three ‘questions before you start’ – and here the option ‘buy + renovate + sell’ is to be discouraged from every imaginable professional angle, unless you have lost of experience, lots of capital, and the support of a property developer equipped with the necessary expertise and network.

  • Do I want to use the property myself?

If you plan to use the property as your own first or second home, the resulting calculations and procedures differ from those associated with a pure capital investment. Answering this question in the affirmative is complicated by the many questions and decisions connected with your own personal living preferences. In our blog post, ‘Watch out when buying a house’ (link to, we tell you about everything that you need to consider. But then you still have to connect all of this with the issues that really matter most – developing the site and stimulating demand in the interests of a genuine long-term investment strategy.

Plus, there’s one more thing: if you let out your own property you may be able to claim tax advantages that you forfeit if you use it yourself.

  • Do I have enough capital?

You can clearly see how important the location is – and not for your own needs, but with a view to the market demand – if you take a look at the financing and return on investment: at least 30% of the purchase price must be raised from your own resources. But this is not just an absolute minimum threshold – it’s also extremely risky. Why? Additional costs might accrue depending on the state of the property, or because of renovation projects or upgrades decided at owners’ meetings, etc. And: non-occupancy can turn thrifty calculations into a scenario that places a heavy burden on your economical survival instead of securing it. Generally speaking, 40–50 % of your own capital is needed for a relatively risk-free investment in your own property. This reduces the interest charges and leaves a little headroom for any potential upgrading investments.

When you let a property as an investment, the all-decisive determinant of increasing value is precise market orientation in matters of fixture and fittings, location and infrastructure – regardless of your own sensibilities, and with minimal risk of non-occupancy.

  • Are there actually sentimental motives behind your investment?

The ‘sensibilities’ we have just mentioned also lie at the heart of the third question: Is your planned investment really a dispassionately calculated source of value, or is it bound up with (understandable) sentimental ideas? For example, are you ‘rescuing’ an old property from your childhood village? In our blog on ‘Property buyers’ mistakes’ (links to we have drawn attention to such a danger (Mistake no. 5 – Buying for sentimental reasons). Without doubt, the preservation and renovation of old building stock by committed private individuals is welcome and should be supported. But – and you should be very clear about this – such a project should not be considered as an investment. It is a costly undertaking which, with a little luck, might attract some funding from the public sector. Renovating historically important buildings comes under a separate category; if you plan to take up this challenge, make use of our skills in this complex area of building renovation as well.

And to sum it up? The ‘Property as investment’ strategy can work out and, even if times like this, is a potentially lucrative option that preserves value. That is, provided that the investment actually is an investment and has been calculated as dispassionately as possible. This does not mean that investments of this kind are unattractive or might not give rise to a certain yearning to use the property yourself later on. If you are interested in other possibilities, we recommend our own investor projects (link to Perhaps you will find some ideas for your portfolio here.