A holiday home as capital investment
According to the German newspaper Die Welt, more and more properties serve as direct capital investment. Most German buyers purchase locally for this purpose (also see our Holiday Property Market Report 2017). But buying a second property also has other benefits. Apart from it serving as a long-term capital investment, many middle income buyers also see a second home as an immediate source of income. Three out of four holiday home owners buy with the intent to let their second home temporarily or permanently.
There are many good reasons for this. On the one hand, an occupied property increases security. On the other hand, the rental income can be used as additional income or to refinance the holiday home. The price of the property also plays an important role for the new home owner. The more expensive it is, the less the likelihood of immediately finding tenants.