Renting or Buying

In Germany owner-occupied houses and flats are taxed very differently from those that are rented out. While owner-occupied homes are treated as a consumer good, real estate which is let is regarded as a capital investment. As a result of this unequal treatment, the relative advantage of buying one’s own home varies over time. Due to the highly favourable trend in interest rates, owner-occupying has in recent years become considerably more attractive. As an evaluation of residential property offered and sought on ImmobilienScout24, Germany’s largest online real estate marketplace, shows, there is a good chance that the proportion of owner-occupied homes will continue to increase in the next few years.