Litigation financing vs. real estate – which investment really pays off in 2025? With inflation, geopolitical tensions, and unpredictable interest rate policies, traditional investments look increasingly uncertain. Many investors still turn to real estate as a safe haven, but litigation financing is emerging as a flexible and high-return alternative worth considering
1. Is Real Estate Still a Safe Investment in 2025?
For decades, real estate has been considered the epitome of safe investment. Even grandparents like to argue, “Real estate offers substance, rent protects against inflation, and long-term appreciation is guaranteed.” So it’s no surprise that many investors are still investing in real estate in 2025. But the market has changed.
According to an analysis by DZ Bank, residential property prices fell by an average of 4.1% in 2023, and multi-family homes even by 5.8%.Commercial real estate was particularly affected, with a decline of over 10%.
High construction interest rates, stricter regulations and increasing office vacancies due to home office and e-commerce are presenting real challenges to the industry. In addition, required equity ratios of 20–30% are now no longer uncommon.
What Are the Advantages of Real Estate Investments?
✓ Tangible asset with potential for value appreciation over decades
✓ Inflation protection through rental adjustments
✓ Option for renting or own use
✓ Tax structuring opportunities, e.g. through depreciation
✓ Leverage effect for new financing projects
What Risks and Disadvantages Does Real Estate Have?
✗ High capital requirement at entry
✗ Ongoing costs for maintenance, management, and taxes
✗ Low liquidity, as capital is tied up long term
✗ Tax-free only after 10-year holding period
✗ Market risks due to political interventions (e.g. rent cap, heating regulation)
Who can still benefit from real estate investments?
If you have sufficient equity, follow a long-term strategy, and are willing to manage actively or pay external service providers, real estate can still make sense.
However, if you are looking for faster returns, lower capital commitment, or more flexibility, you should look into alternative investments. This is exactly where litigation financing comes in.
2. Litigation financing as an alternative investment
Litigation financing is still a blank slate for many investors. Yet especially in uncertain times, it offers interesting prospects. The principle behind it is simple, once understood.
You provide financial backing for legal cases, for example, when a party wants to assert legitimate claims but cannot afford the legal costs. In return, you receive a success-based share. If the case is won, you as a sponsor benefit directly from the settlement or court award.
What Is a Real Example of Litigation Financing?
A medium-sized company wants to sue a former business partner for breach of contract but cannot cover the legal costs. Platforms like AEQUIFIN review the case both legally and financially and provide funding for the proceedings through sponsors. As a sponsor, you help finance the case. In successful cases, returns of up to ten times the initial investment have been possible in the past.
“This type of alternative investment is not dependent on real estate or stock markets, but is based on legally justified individual proceedings.”
Advantages of litigation financing
✓ Entry thresholds are low, so you can invest with smaller amounts
✓ Development in litigation financing is independent of stock or real estate markets and thus less volatile
✓ Terms are plannable and usually limited to 12–24 months with litigation financing
✓ Providers like AEQUIFIN give you access to vetted, transparent cases
✓ By investing in multiple cases, you can effectively diversify risk
Risks and disadvantages of litigation financing
✗ Total loss is possible if a case is lost
✗ No early liquidity, as capital is tied up until the case is resolved
“Thanks to the quota balancing system, sponsors at AEQUIFIN have so far not suffered a single total loss. In the past, only profits were achieved.”
Why consider litigation financing as an investment?
If you are looking for a flexible, well-structured, and independent alternative to traditional forms of investment, litigation financing offers an exciting entry point. You don’t need large starting capital for litigation financing, benefit from clear terms, and are not tied to stock or real estate developments. Platforms like AEQUIFIN make access simple, transparent, and efficient. Ideal for anyone in 2025 who wants to invest specifically in an alternative investment with calculable risks.
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3. Litigation Financing vs. Real Estate: Which Investment Performs Better in 2025?
Real estate is a classic investment – litigation financing, on the other hand, is an emerging insider tip. But how do the two options compare directly? Especially under the conditions of 2025, this comparison becomes interesting.
How Much Capital Do You Need for Real Estate vs. Litigation Financing?
Real estate requires mass. Without at least 20–30% equity, there’s usually no way forward. Purchase costs, renovations, management. The start is expensive for investors.
Litigation financing requires courage. You can start with small amounts. No loan, no paperwork, no property. But full control over your alternative investment.
Return potential & risk
Real estate is rigid and sluggish. The return comes – but slowly. Ongoing costs and political interventions further reduce yield. If you buy wrong, you lose. Short-term thinking doesn’t really help here.
Litigation financing is focused. You invest in individual cases with realistic and previously calculated chances of success, using the litigation cost calculator. The risk lies in the individual case, the opportunity in an above-average return. Multiple returns on your investment if things go as planned.
Calculate return potential now
Use the AEQUIFIN litigation cost calculator to see in just a few seconds what potential a case holds. Transparent, realistic, and free of charge.
Liquidity & terms
Real estate ties up your capital. Once purchased, the money often stays locked in the property for years. Selling – especially if you want your profits to remain tax-free – can and will take time.
Litigation financing brings movement into your portfolio. Many cases are resolved within 6–24 months. You remain flexible and can quickly reinvest. You can reposition your investments at any time.
Market environment & trends 2025
Real estate is under pressure in today’s unpredictable times. Interest rates, construction crises, and regulations are the buzzwords here. The market is losing its shine – especially in the commercial sector.
Litigation financing is gaining momentum. The market is growing, demand is rising, and platforms like AEQUIFIN are opening this niche up to private investors for the first time. Efficient, digital, and professional.
4. Litigation Financing & Alternative Investments: Figures, Growth and Outlook 2025
The trend, judging by the numbers, is clear. Alternative investments are rapidly gaining in popularity – among both institutional and private investors. According to the BAI Investor Survey 2024, 99% of institutional investors in Germany are already investing in alternative asset classes. Litigation financing is also developing dynamically.
In the US, the market for litigation financing is already well established. Billions flow into litigation finance there every year – primarily via specialized funds, family offices and increasingly private investors. According to a market analysis by Research Nester, the global volume in 2024 was around 14.6 billion US dollars, with projected growth to over 50 billion by 2036. Those who enter the niche of litigation financing today benefit not only from potentially attractive returns, but also from the advantage of entering an emerging market segment early.
