Prepayment Penalty for Loans vs. Current Interest Earnings

Hehe... you only hold that opinion as long as

- the apartment doesn’t burn down
- you haven’t caught any "rental nomads"
- your tenants don’t go into private insolvency
- the tenants don’t have children
- no elderly people live there who cannot reasonably be subjected to an eviction lawsuit
- ...

Getting a tenant out of your property can take many years in case of doubt, along with the costs for renovation. The rental deposit isn’t even the down payment—you bear that yourself.

Of course, the financial markets are the best option to make money... provided you have money to invest.
No one has ever gotten rich from just one rented condominium.

PS:
In Germany, it is easier to disinherit children (which is difficult enough) than to terminate a (long-term) tenant if the tenant resists, that has to be said. But if they resist, good luck in court.

Not only that, an ETF cannot be worn out and you have to keep putting money into it.

Whether it makes sense or not is debatable. In the end, everyone wants to see their return. Some with more risk, others with less.

Since one already owns a house, real estate probably represents a concentration risk for almost all forum members present here. Even more so with an additional rented apartment. If one owns many rented apartments, the risks mentioned by MachsSelbst at least somewhat balance out within the same income type, but the concentration risk always increases. If you then consider topics like rent control/price caps or even worse special levies for property owners, I’d rather invest my remaining money in ETFs. Landlords usually achieve the right returns only through the sale and not through renting. Ultimately, it’s also just speculation. Better to go through the stock market. In any case, everything is better than a bank account or a mattress.

The correct return is usually only achieved by landlords through the sale and not through renting. Ultimately, it's also just speculation. Better to do it through the stock market.

The profit is in the purchase. I like to buy apartments for 20-40k purchase price (40-60 sqm) and "only" 5-7€ rent. The money comes cleanly and regularly from the authorities. Never a default. Return is really good. It works better the worse the region is. Limited in top-7 cities.

More than two years have now passed since I started this topic. It's amazing what has happened globally in the meantime.
A small update on the original idea: So far, we have remained true to the line "invest money instead of special repayments" and have constantly kept the capital moving, depending on where the better interest rate was. Over the last 24 months, we averaged 3.15% interest – without a securities account. Of course, we have continued to save diligently and will most likely manage to pay off not only the land but also the house loan within the next 5 to 6 years. Naturally, we are concerned about a "wealth levy" or similar starting from a certain amount of "cash" in the account/securities account. But even if we had bought apartments, there would be a risk of some kind of burden equalization through property owners.
Our new goal is to be debt-free in our early 40s while continuing to invest the same amount as for the loans specifically into retirement provision. After all, you want to maintain a certain lifestyle in old age.

Compensation for burdens

So I don’t consider it realistic – but if the state really confiscates cash values, then it will have to do the same for real estate (in the form of a compensation for burdens) as long as there is a rule of law. Then no one can hide so easily anymore – maybe still crypto. But as I said: one shouldn’t worry about such things, because that would certainly be the smallest societal problem.