Comparison: Owner-occupied property vs capital investment

Quick, clear, the differences between the two forms:

Purpose of the property: Fact #1

What does self-interest mean?

A property is bought and used for your own living requirements. The focus here is on personal living comfort – simply put: you buy your dream home

What does investment mean?

A property is acquired in order to generate income. This can be done by renting it out or selling it later. The focus is on financial returns – simply put: you are buying a money-making machine

Extra tip – The two can also be combined to a certain extent. You buy a house or buy an apartment, live in it for 3 years and can then sell it tax-free(speculation period). Let’s say you buy in an A-location in Berlin, then property prices usually rise by ~8% per year. Calculate 3 years and you will see that this profit alone is considerable.

The differences get bigger step by step:

Financing: Equity & credit

Owner-occupation: Financing is usually provided via a real estate loan or the buyer’s equity.

Capital investment: Financing is often provided by borrowed capital, such as mortgages. The aim here is also to leverage borrowed capital. Proper financing needs to be planned, read more about financial planning before buying here.

Extra tip – In principle, both forms are the same, the only differences are state subsidies and taxes, more on this in a moment. In the case of personal use, however, banks may see a greater risk in the credit check. Why? Let’s say you have 2 incomes and 1 house. Someone falls ill, loses their job, the loan installment defaults.

Why do investors like to borrow?

The explanation would be long, in a nutshell: there are many aspects. Firstly, you don’t want to spend your equity on a property. With the leverage effect of financing (20% equity [or less] + 80% debt), you can “afford much more”. A loan is now taken out, including the loan installment, i.e. the monthly repayment. Inflation ensures that money becomes worth less. The loan installment therefore becomes “cheaper” and “cheaper”. Learn more here:

• Real estate as a capital investment

Useful life: For the sake of completeness

Owner-occupation: Owners plan for the long term and intend to live in the property themselves.

Capital investment: The focus is on short or long-term income, whether through rental income or sale. Also important for you: the speculation period. Want to quickly calculate whether you can already sell tax-free? Use our speculation period calculator.

Now we come to one of the main differences.

Tax aspects: Tax advantages for landlords

Owner-occupation: Under certain conditions, tax benefits such as homeowner’s allowance or tax exemption on sale (after owner-occupation) can be claimed.

Capital investment: Rental income is taxable, but tax benefits such as depreciation and income-related expenses can also be claimed.

What tax benefits do owner-occupiers / investors enjoy?

Extra tip – Quickly explained, only 2 examples each:

Owner-occupiers receive homeowner’s allowance: Under certain conditions, owner-occupiers can receive homeowner’s allowance for the construction or purchase of owner-occupied property in order to facilitate their financing. This brings us back to the speculation period, which is of course also important for owner-occupiers when selling.

Tax exemption on sale: If you sell your owner-occupied property after a certain holding period, the profits made may be tax-free under certain conditions. However, this does not apply if you sell your home within ten years of buying it.

Capital investors can claim depreciation: Capital investors can claim depreciation on their rented property. This means that they can deduct certain costs such as building depreciation and financing costs, which reduces their tax burden.

Income-related expenses: All expenses incurred by renting, such as repairs, management costs and insurance, can be deducted as income-related expenses to reduce taxable income.

More about taxes & real estate:

• Tax advantages for investors

Maintenance and administration

Owner-occupation: The owner is responsible for the maintenance and management of the property.

Capital investment: Management and maintenance can be transferred to third parties, such as property management companies.

Extra tip – What should you expect? I recommend 2% of the purchase price per year. I also have a small calculator for the maintenance reserve here. PS: Of course you can pass on operating costs to tenants.

Expected return: earn money, don’t spend it

Owner-occupation: The main motivation is the personal quality of living, the return on investment is secondary.

Capital investment: The focus is on returns, and investors expect to generate income from their property. Again, because it is very important for investors:

“The focus is on returns, and investors expect to generate income from their property.”

The choice between owner-occupation and investment depends on your individual financial goals, circumstances and preferences. Both approaches have advantages and disadvantages, and the decision should be made carefully.

Learning from real estate experts?

Short and sweet, my recommendation:

• Real estate coaching

Der Beitrag Own use vs. capital investment Difference: credit, costs, tax benefits erschien zuerst auf ℄ Real Estates.

From wild animals to tame pets – what animals can be kept with people?

Pets are man’s best friend, however not every animal is suitable for keeping with humans. Many animals are wild and as cute as they may be, they simply do not belong in an enclosure, but in the wild. Find out now which animal is suitable as a pet and which animals are better left in the wild.

Dogs as pets – man’s best friend

A dog can enrich your life as a family member and companion. In the summer with a dog on the road at the lake or in the park makes directly good mood. However, not every dog is suitable for everyone. Often there are allergies to dogs or certain requirements for the character, size or breed. Depending on individual circumstances, some dog breeds are better suited than others. Learn more about dogs as pets and the different dog breeds!

Editor’s Rating:

• Family friendly 4.5 / 5.0
• Single and couple friendly 4.5 / 5.0

https://www.instagram.com/p/BxJkCN2hnQe/

Cats as pets – companions for life

Cats are very elegant, beautiful but also stubborn animals. They are more independent than dogs, but still integrate into the family. Cuddling or playing the cats love and are therefore perfect as a pet. Who wants to have a cat as a pet, which should first be well informed, because cat is not equal cat. With the four-legged friends there are many differences both from nature and from the appearance between the different breeds. Learn more about the cat as a pet!

Editor’s Rating:

• Family friendly 4.5 / 5.0
• Single and couple friendly 4.5 / 5.0

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Rats as pets – Tame and easy to care for

Rats are crepuscular small animals that belong to the rodent genus. There are a few things to keep in mind when keeping these small animals. They should never be kept alone and need a lot of space. At least one playmate, the rat should have. The socialization with other rodents, we mice is not species-appropriate here, however. The enclosure of the rats should be large enough. They need a lot of free space and room to move around. The rats also love a regular run in the apartment. But always keep an eye on them, otherwise they like to gnaw on furniture. Rats are very tame and intelligent animals and are happy to spend time with their owner. Rats as pets are especially suitable for professionals or children over twelve years.

Editor’s Rating:

• Family friendly 3.0 / 5.0
• Single and couple friendly 4.5 / 5.0

https://www.instagram.com/p/BwWJnZmBWJt/

Owl as a pet – the wild animal belongs in nature

Even if owls look very cuddly and at the latest after the Harry Potter film series appear as good pets, they are on the contrary wild animals and can even be dangerous with their sharp claws and their pointed beak. The animals make very high demands on their habitat, which is why keeping them in a species-appropriate manner is very difficult. In Germany, the keeping of owls is rarely allowed and is subject to certain conditions. These include not only a large aviary in the garden, but also distinctive expertise in keeping owls. Here again it becomes clear that wild animals should remain in the wild and are not well suited for keeping as pets.

Editor’s Rating:

• Family friendly 0.0 / 5.0
• Single and couple friendly 0.0 / 5.0

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Turtle as a pet – friends for life

Most common are Greek and European tortoises but also water turtles. Since turtles can live up to 100 years, depending on the species, the small reptiles are an acquisition for life. Depending on the species, the turtles require certain conditions. Tortoises run a lot, which is why they need a large outdoor enclosure with plenty of space. Aquatic turtles, on the other hand, can be kept in an 80 to 120 cm terrarium. Both species need a place to swim, to wander and the warmth of the sun, which can be provided by a UV lamp, especially in winter months. The animals are very happy about plants in the enclosure, because these give them security. Turtles are very easy to care for animals and true companions for life.

Editor’s Rating:

• Family friendly 4.5 / 5.0
• Single and couple friendly 4.5 / 5.0

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Hedgehogs as pets – forbidden in Germany

Hedgehogs are protected in Germany and are therefore not to be kept as pets. In some cases, however, the little animals are dependent on help from people. If an obviously sick or injured hedgehog is found, it should be taken to a vet as soon as possible and cared for. As soon as it has recovered, however, it should be released again.

An exception is the African white-bellied hedgehog. This may be kept in Germany as a pet, as it is not under nature conservation. However, the animal remains a wild animal and usually does not feel comfortable in the keeping. A hedgehog needs a very large enclosure in the open air, as these animals normally travel several kilometres at night in search of food. It is generally not advisable to keep hedgehogs, however, as the animals rarely feel comfortable despite being kept in a species-appropriate manner and belong in the wild.

Editor’s Rating:

• Family friendly 0.0 / 5.0
• Single and couple friendly 0.0 / 5.0

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Mice as pets – the small rodents are very flexible

Mice are very good as pets, but only with at least one conspecific. There are different types of mice, such as the color mouse, the gerbil or the spiny mouse, which show different character traits and behaviors. It is also recommended to keep only mice of one sex together, so that there are no unwanted offspring. The enclosure of the mice is very flexible. It can consist of a cage as well as a terrarium or aquarium. Important for the mice is a lot of activity. Different levels, pipes and sticks for climbing but also a sleeping house for the resting phases should not be missing in any enclosure. The mice like hay or paper handkerchiefs particularly well, because they can build small nests with it. The small rodents are very good as pets and are very easy to care for.

Editor’s Rating:

• Family friendly 4.0 / 5.0
• Single and couple friendly 4.5 / 5.0

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Monkey as a pet – not recommended for private individuals

Even if film and TV teach us otherwise, monkeys are not suitable as pets. Especially private persons underestimate the costs, the work and the space monkeys need. Calculate easily: online calculator. Since monkeys should not be kept alone, the purchase of at least two or more monkeys is necessary. These need a large enclosure, so that they can also go out of the way and disputes between the monkeys are avoided. If the monkeys are kept in the apartment, they damage furniture, leave their business everywhere and sometimes bite. Monkeys will never be house-trained! Even if the animals are still very small, loving and needy as babies, their nature changes at the latest in puberty and they can become aggressive and wild. So it becomes clear that monkeys should not be kept by private persons, because the demands of the animals are so high that they can hardly be met. Monkeys are and remain wild animals and belong in the wild.

Editor’s Rating:

• Family friendly 0.0 / 5.0
• Single and couple friendly 0.0 / 5.0

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Ferret as a pet – playful and trusting

The small animals from the marten family are very trusting and playful. They should not be kept alone, because the animals need a lot of distraction and employment. The enclosure of the animals should be sufficiently large and individually designed. For two animals an enclosure of at least six square meters is needed. If the space allows it, the animals are also happy about their own room, where they have a lot to discover. Important for martens are different floors, so that the animals can live out their climbing instinct. Sticks, tubes, toys and hammocks should not be missing in any enclosure. In addition, ferrets need blankets, a toilet and a hiding place to retreat and sleep. Ferrets also love to bathe in shallow bowls of water. Outside of their enclosure, the animals need at least four hours of free access in the apartment every day.

Editor’s Rating:

• Family friendly 3.5 / 5.0
• Single and couple friendly 4.5 / 5.0

https://www.instagram.com/p/BxHfDEhlY2o/

Fox as a pet – wild animals do not belong on a leash

Foxes are wild animals and are not suitable for keeping as pets. There are strict regulations for keeping wild animals in Germany. One of the most important is that an outdoor enclosure of 30-40 m² (depending on the species) must be available so that the fox can pursue its innate urges, such as digging a burrow. It is strongly discouraged to buy foxes from breedings, as for example from Russia, because the animal husbandry here is not species-appropriate and the trade is unscrupulous. If you find an animal in need of help, you should immediately take it to a veterinarian or contact the nature conservation association or rescue organizations for wild animals. If the fox cannot be reintroduced to the wild after it has been rehabilitated, you can continue to care for it if you meet certain requirements.

Editor’s Rating:

• Family friendly 0.0 / 5.0
• Single and couple friendly 0.0 / 5.0

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Der Beitrag Which pet suits me? – the big guide on the subject of pets erschien zuerst auf ℄ Real Estates.