Use of Credit vs. Equity

- Assuming a rent of 1500 EUR, you save about 50k EUR just in rent over 2-3 years, which at least compensates for the additional purchase costs

Counting your chickens before they hatch. You forgot the interest. A 600k loan at 3% means 1500€ interest per month alone, more than the current rent. If you finance the whole thing with equity, you have to factor in opportunity costs. By the way, your assumed rent savings are generously rounded up compared to the current rent. Just wishful thinking. The rest, as I said, is hard to predict. But your list is very one-sided focused on inflation and ignores that rising inflation will also lead to rising interest rates. These, however, are counterproductive for tangible assets. The attractiveness of Stuttgart could also take a hit. Let’s suppose the structural change in the automotive industry turns out somewhat unfavorably... And how realistic is the risk of a personal use termination?

Inflation is at 8% or so. There is no asset class that can compensate for that. And certainly not over 2-3 years. Rental yield is on average below 3%. Why not step on the gas and start your real estate project now? Spending money is also a good strategy against inflation :D

Addendum: Don’t tenants in a multi-family house automatically have a right of first refusal? Then you could wait first, see what happens and who buys the apartment. If an investor buys it, you continue living there; if it smells like a termination for personal use, you can intervene in the notary contract and buy yourself under the same conditions.

Milkmaid, I hear you coming. You forgot the interest. A 600k loan at 3% means €1500 interest per month alone, more than the current rent. If you finance the whole thing with equity, you have to account for opportunity costs. Your assumed rent savings are generous compared to the current rent anyway. Cooked the numbers nicely, basically.

The interest part is correct; without equity your calculation would be right and injecting equity would have the mentioned other disadvantages.
What is not correct: The rent savings referred to the case of a move necessity due to owner’s own use termination (which I already explained above); the €1250 rent is only possible because I have lived here for years and a graduated rent increase has been agreed. According to the rent index, the rent should currently be at least €1600, rather €1750; so the €1500 are the opposite of cooked numbers ;)

Otherwise, the appreciation of the property itself should also be considered; according to 3 appraisals the value is already significantly above the discussed selling price, so in case of resale the loss risk should at least be limited – yes, unless the market crashes – but that can also happen on the stock market...

The rest is, as said, hard to predict. But your list is very one-sidedly focused on inflation and ignores that rising inflation will also lead to rising interest rates. These, however, are counterproductive for tangible assets. The attractiveness of Stuttgart could also take a hit. Let’s say the structural change in the automotive industry turns out somewhat unfavorable...
And how realistic is the risk of an owner’s own use termination?

The risk of an owner’s own use termination is unfortunately very high.

What is still open is my main question:
What is the better alternative to buying given the overall scenario; leaving the money in the bank certainly isn’t either, right? :)

Why not step on the gas and start your real estate project now? Spending money is also a good strategy against inflation :D

Ever tried to find something "quickly" in Stuttgart? ;)

Addendum:
As a tenant in a multi-family house, don’t you automatically have a pre-emptive right? Then you could just wait and see what happens and who buys the apartment. If an investor buys it, you continue living there; if it smells like a notice for personal use termination, you can interfere in the notary contract and buy it yourself on the same terms.

That would be entirely new to me; possibly you are referring to the blocking periods, but these only apply after conversion into individual ownership apartments.