Pay off the home loan or use the money to build another apartment?

Thank you for the first hints and tips. In fact, the money is already in our account. The bank has taken pictures of the finished house and now doesn't want to see anything from us, except the regular repayments.

Now putting the whole thing into one big single property, where you already have a concentration risk in the form of your property, I think is complete nonsense.

Sure, there is a risk with another house, but where should the risk lie nowadays in tying yourself to a lump? Or do you mean it from the aspect of repayment and reduced quality of life because one is financially more restricted?

A small condominium would be better.

What is the advantage compared to a bungalow? Our previous rental apartment in an 11-unit building cost about €135k with a living area of 75 sqm. I find that very expensive, which I also attribute to the costs of the property manager, brokers, etc. I wanted to avoid these costs by building ourselves.

Maybe again about the lump sum:

You have built a house for yourself and invested most of your equity in it. Now you want to put the rest into a real estate investment.

However, it can happen for various reasons that real estate as a whole or a single property suddenly loses value dramatically.
With a self-used property, this is often not so bad as long as you don’t have to sell.
But if you have a problematic tenant in a rented house, then you get a problem because all your rental income disappears and if you eventually get him out, you first have to do a complete renovation.

This is comparable to putting everything in the stock market into a security with margin calls.

You can reduce the risk that everything collapses at once if instead of the house you buy 3 small rented apartments.
This will very likely prevent total loss, but it is still comparable to putting everything into one industry on the stock market.

Currently, for example, there are developments in the commercial real estate sector where companies are downsizing their office spaces and switching to desk sharing because employees have moved to home office and will continue to stay there. This can change entire cities and will subsequently also affect the housing market because suddenly additional space is available as residential space. Rent prices may stagnate or fall and subsequently also real estate prices.
Just as well, Corona could have wiped out 20% of the population and suddenly there would have been an oversupply of houses and apartments.
In this case, maybe 3 apartments would not help you either.

One should weigh this carefully and possibly diversify across several forms of investment.