What to do with a lot of equity?

Hello everyone,
I hope I’ve landed in the right topic first. I wasn’t really sure where to put this.

We are planning to buy a property and are currently still doing something like collecting ideas and concretizing them. Everything is conceivable for us (still) from the condominium to a 2/3-family house.
The consideration roughly fluctuates between:
- buying a property just for us (the two of us, expecting children) and living rent-free quickly
- or renting out part of it to have some security later with rental income

We live in Bavaria and would have to pay about €300,000 for a condominium (4 rooms, from 100 m2), for a single-family house between €300,000 and €400,000 plus land. Rough estimates.

We have between €2,800 (in the worst case) and €4,000 net available monthly. We have around €260,000 in equity. All in all, we would come to just over €300,000, but then everything would be drained and we actually don’t want that.
At the moment we pay €920 cold rent. I will move to another location for work, so a move is coming. This makes our considerations more concrete; I just don’t want to rent again.

Now I am weighing things up and thought I’d get some opinions from other home buyers.

What do you think of the idea of buying a condominium now (relatively quickly), moving in there yourself to first manage the location change, and then calmly looking for a plot and possibly building? Then renting out the condo or selling it again (for a profit?)? There are 1 or 2 interesting new-build condominiums that would be an option.

As I said, these are all just considerations so far and I would like to exchange pros and cons.

Best regards

Buying a property with the plan to actually want to buy another one, I did not really consider sensible. Why not just rent first?

Why not rent first? I am reluctant to pay rent for another 1 or 2 years when I could invest that money in homeownership.

Keep in mind that no one guarantees that you can sell something new again at a profit.

That is clear. Possibly one condominium is enough for us and we would keep it. Or we might rent it out.

Hello,

What do you think about the idea of (relatively quickly) buying a condominium, moving into it yourself to manage the location change first. And then calmly searching for a plot from there and possibly building? Then renting out the condominium or selling it again (profitably?). There are one or two interesting new-build condominiums that could be considered.

The tax office might quietly smile at the word "profitably."

No tax is incurred on the sale of a house or apartment if the property was used exclusively for personal use or was used for your own residential purposes in the year of sale and the two preceding calendar years (§ 23 Income Tax Act).

How market prices develop is then the next question. The local market in the Stormarn district (in the commuter belt of Hamburg) is already somewhat overheated; prices are paid that are just outrageous, at least from a local perspective. Plots are also scarce or the very last building gaps are being filled. This ultimately has consequences for the prices of a condominium.
Oh yes, please also consider the issue of service charges (called “Wohngeld” here), which can become unpleasant with a condominium.

If the owners' assembly decides by majority to have stairway handrails adorned with gold leaf, that can represent a financial problem for the individual. You no longer have control over decisions about such costs.

Kermit