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Opportunity - advice needed

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  • 24-12-2008 11:49am
    #1
    John Mason
    Hosted Moderators Posts: 10,661 ✭✭✭✭


    I have been given an opportunity of moving into a lovely 3 bed apartment rent free indefinately,

    But the catch is i will have to rent out my own house which will put me in a much better position financially but i am concerned about having strangers living in my house, which i have worked so hard on.

    I was considering going with a managment company/estate agent. Do these companies vet people? or are they happy to let any random person move in?

    Would i be better off taking all my possesions out of the house - pictures, cooking untensils etc.

    i am not really sure what information i am looking for really but trying to figure out, how likely my house would be trashed

    thanks


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    #2
    Emerald Lass
    Closed Accounts Posts: 439 ✭✭Emerald Lass


    firstly, if you are very attached to the house then I would say don't rent it out. If you keep thinking of it in terms of 'your home' or 'your house' then you will be a bag of nerves whom ever you allow to rent it. If you rent it out you need a certain level of detachment, and you need to start thinking of it a a business and a rental property - not your home. For some people (myself included) this is a difficult change of mindset to make.

    secondly, renting out is not as simple as many people think, and there are plenty of things to consider. There is always the chance that your house will get trashed - that is why vetting tenants, getting references and having a solid lease is so important.

    In my experience relying on an agent to look after the property is a mistake as they do not attach as much importance to your property as you would yourself. I used an agent initially and he caused me more trouble than he was worth, I ended up paying him a months rent to allow a complete waster into my house (he said he had vetted and checked references - I now seriously doubt that) and I was left with the situation of a tenant not paying rent and having to start eviction proceedings, and then had a vacant period and had to find a new tenant. Since I started renting I have heard more negative stories about Letting agents than positive - my advice is, if you do decide to rent out either do it yourself, or apoint a friend or family member who would be suitable to manage the property and the tenants and pay them instead. Money much better spent.

    Also, the market is not good for LL's at the moment - there are more properties available than renters, so renters can pick and choose where they live. Properties need to be of a great quality and have every imaginable facility to ge a good rent - so removing everything from the house is seriously going to decrease your chances of renting it.

    Also if you have a mortgage, renting out is no longer a guarantee of making a financial gain. You may well only get enough rent to cover the mortgage - so you wouldn't be a whole lot better off living in a different house and letting strangers in your home. If your rent doesn't cover the mortgage then you will end up paying out anyway. And many banks are now refusing to allow mortgages be changed to interest only mortgages as they are aware of the rental market.

    you will also have to pay taxes as a LL and submit Tax returns - if you are inexperienced in this it is best to employ an acountant for at least the first year, so that is another cost you will need to take into consideration. There are also advertising costs, the time it takes to find a tenant, and being available 24/7 should there be an emergency.

    finally, depending on how long you have been in your current home, you may also be liable for stamp duty.

    there are lots of things to consider and as I said it is not as straight forward as so many people think - its not always a simple case of letting someone else pay off your mortgage. There is a lot involved in being a LL - this is lesson I am learning everyday and TBH if I didn't HAVE to rent out my house at the moment, I wouldn't. Luckily I will be moving back into the house myself in March or so, and its a relief as being a LL at any time is not easy, but in the current market, unless you are lucky enough to have a good accoutant, plenty of 'safety net' money in the bank, and a good bit of experience, its quite nerve wracking.

    If I were you, and loved my home as much as you seem to, I would be unlikely to rent it out, even for a financial gain, unless that gain was in the thousands or something, or my mortgage was crippling me. For a couple of hundred a month or so, I wouldn't do it. The main thing is to be realistic, don't assume the rent will cover the mortgage, tax, costs and expenses, as it may well not and then a stranger is in your 'home' and you are gaining little or nothing only worry and stress!

    If it looks too good to be true, it usually is!


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    #3
    johnnyskeleton
    Moderators, Entertainment Moderators, Politics Moderators Posts: 14,505 Mod ✭✭✭✭johnnyskeleton


    pink fluffy bunny wrote: »
    I have been given an opportunity of moving into a lovely 3 bed apartment rent free indefinately,

    But the catch is i will have to rent out my own house which will put me in a much better position financially but i am concerned about having strangers living in my house, which i have worked so hard on.

    I was considering going with a managment company/estate agent. Do these companies vet people? or are they happy to let any random person move in?

    Would i be better off taking all my possesions out of the house - pictures, cooking untensils etc.

    i am not really sure what information i am looking for really but trying to figure out, how likely my house would be trashed

    thanks

    Take the 3 bed, live there for a week or two.

    After the week or two, rent the 3 bed and move back into your own house.

    Spend the rent money on sauce.


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    #4
    the_syco
    Registered Users Posts: 37,299 ✭✭✭✭the_syco


    Emerald Lass wrote: »
    firstly, if you are very attached to the house then I would say don't rent it out. If you keep thinking of it in terms of 'your home' or 'your house' then you will be a bag of nerves whom ever you allow to rent it.
    +1. Read PLENTY of threads about these types of landlords on this. You don't see wear and tear when you do it, but when someone else does it, you'll be thinking of when this was "your home", etc, etc, and get emotional over it.

    Also... "rent free" = marraige? If not, please give more info, as it seems someone may be trying to scam you. Nothing is free, esp when "you must rent your old house"...


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    #5
    Trinity
    Closed Accounts Posts: 4,662 ✭✭✭Trinity


    I'm not fortunate enough to own my own home but if i had one i would never let it out to strangers, houses to let are usually business only investments but you obvioulsy think a lot of this house and have put time and effort into it.

    I'm a tenant and have always looked after my properties and treat them as my home, but i have heard some horror stories.

    Is there anyone you know personally looking for a home to let that will treat it as their own?

    If not take everything out of it and replace it with cheap stuff or let it unfurnished. I think you would be better avoiding letting agencies, you should vet the people yourself and arrange regular checks on the property etc. The agencies dont seem to give a damn, i never heard from mine in 18 months living in the same property while my landlord was abroad.


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