An Austrian tycoon is giving away every penny of his 3 million ($5.3 million) fortune, having realised that being rich made him unhappy.

Karl Rabeder, 47, a businessman from Telfs, near Innsbruck, is selling his villa with lake, sauna and spectacular mountain views over the Alps, valued at 1.4 million. Also for sale is his old stone farmhouse in Provence, on the market for 613,000. Already gone is his collection of six gliders valued at 350,000. Mr Rabeder has also sold the interior furnishings and accessories business - from vases to artificial flowers - that made his fortune.

Karl Rabeder - Austrian Tycoon

"My idea is to have nothing left. Absolutely nothing. Money is counter-productive - it prevents happiness."

He will move out of his Alpine retreat into a small wooden hut in the mountains or a simple bedsit in Innsbruck, surviving on 800 a month while the proceeds go to a charity he set up in Latin America. He will draw no salary from it.

"For a long time I believed that more wealth and luxury automatically meant more happiness. I come from a very poor family where the rules were to work more to achieve more material things, and I applied this for many years."

But over time a conflicting feeling developed. "More and more I heard the words: 'Stop what you are doing now – all this luxury and consumerism – and start your real life'," he said. "I had the feeling I was working as a slave for things that I did not wish for or need. I have the feeling that there are lot of people doing the same thing." For many years, he said, he was not brave enough to give up his comforts. The tipping point came during a three-week holiday with his wife in Hawaii.

"It was the biggest shock in my life when I realised how horrible, soulless and without feeling the five-star lifestyle is."

"In those three weeks we spent all the money you could possibly spend. But in all that time we had the feeling we hadn't met a single real person - that we were all just actors. The staff played the role of being friendly and the guests played the role of being important, and nobody was real."

Mr Rabeder decided to raffle his Alpine home, selling 21,999 tickets at 87 each. The Provence house, in the village of Cruis, is on sale at the local estate agent.

All the money will go into his microcredit charity, which offers small loans and advice to self-employed people in El Salvador, Honduras, Bolivia, Peru, Argentina and Chile.

Since deciding to sell up, Mr Rabeder said he had felt "free, the opposite of heavy". But he did not judge those who chose to keep their wealth. "I do not have the right to give any other person advice. I was just listening to the voice of my heart and soul."