135k cash, would you

yoloc

Just curious to know your thoughts on this. 135k cash, theres a few properties in carrick on shannon for 34k and even an apartment for 20k. If you had the cash coming and in secure work(or even on the dole) would you take a chance and buy a few of the properties to generate an extra income and wait on the price climbing in about a decade.

Frank Lee Midere

If you can rent them, why not.

xper

yoloc wrote: »

Just curious to know your thoughts on this. 135k cash, theres a few properties in carrick on shannon for 34k and even an apartment for 20k. If you had the cash coming and in secure work(or even on the dole) would you take a chance and buy a few of the properties to generate an extra income and wait on the price climbing in about a decade.

Where do you think this extra income is going to come from? Ask yourself why they are being sold for the price of a decent car.

foggy_lad

Can you be sure the prices will rise enough in Carrick on Shannon to make all the work as a landlord worth the effort?

the_syco

yoloc wrote: »

theres a few properties in carrick on shannon for 34k and even an apartment for 20k.

Priced low enough to get rid of, with maybe another €20k to make each one liveable. If they could be rented, wouldn't they already be rented, though?

yoloc

the_syco wrote: »

Priced low enough to get rid of, with maybe another €20k to make each one liveable. If they could be rented, wouldn't they already be rented, though?

Ready to move into, no work needs done

http://www.daft.ie/searchsale.daft?id=727446

yoloc

foggy_lad wrote: »

Can you be sure the prices will rise enough in Carrick on Shannon to make all the work as a landlord worth the effort?

All houses in ireland, 10 yrs time will be sold for more than their bought for now( ithink) In that time there'd be a potential 1200 a month extra income (without taxes)

khards

How much is rent allowance in that area? That is what you should base your return on as no working person would live there.

yoloc

khards wrote: »

How much is rent allowance in that area? That is what you should base your return on as no working person would live there.

What you mean no working person would live there. If the rent was decent, of course a working person would live there. Sitting here shaking my head at why you'd make such a statement. Even if it was someone on rent allowence, with the right person/cple, it would still be a good investment.

Victor

yoloc wrote: »

What you mean no working person would live there. If the rent was decent, of course a working person would live there. Sitting here shaking my head at why you'd make such a statement. Even if it was someone on rent allowence, with the right person/cple, it would still be a good investment.

Too much supply, not enough demand.

who_ru

think of the responsibilities a LL has - it's not all gravy.

Gone West

yoloc wrote: »

What you mean no working person would live there. If the rent was decent, of course a working person would live there. Sitting here shaking my head at why you'd make such a statement. Even if it was someone on rent allowence, with the right person/cple, it would still be a good investment.

I'm also sitting here shaking my head

Well if you look at the place, you can see that the estate agent "PropertyTeam Smith Kelly Scott" haven't even bothered to sweep the trash or put plates in the dishwaster.
You might say that that's not their job, but it is an indicator of what you're dealing with.

This is a shoebox apartment built in an estate of apartments in an unprivileged county far away from the jobs market.
This is one of the most depressing types of accommodation you could live in, in Ireland.
Apartments should be central, and easily walkable to local services, schools, doctor, shops etc.
These things will never get €1200 in rent. They will fall down before anybody will pay near that to live in them.
You want to invest your 130k and sit back and live the easy life? Not gonna happen in Ireland, 130k is not a lot, and as you can see a lot of other fools went and "invested" in Leitrim and lost their shirts.

I've no doubt that at some stage those places will be worth more than 20k, but what about the management fee?
Likely somebody is still clinging to the idea that they maintain a job in a company that "manages" these places.

Mrs OBumble

yoloc wrote: »

What you mean no working person would live there. If the rent was decent, of course a working person would live there. Sitting here shaking my head at why you'd make such a statement. Even if it was someone on rent allowence, with the right person/cple, it would still be a good investment.

What's the labour market like in the area?

What's the overall supply of low-rent accommodation in the area - and in areas with jobs that are in commuting distance?

What facilities are in the area?

Do you have the capacity (time, energy, skills) to do the property management yourself? (It's looking like the last property manager couldn't even be a**ed cleaning up the place - not a good look).


I think the issues you need to think about are more to do with the area / external factors, rather than the properties themselves.

eclectichoney

You can rent a similar 2 bed for €300 per month so rental income of €3300 if you are lucky and only have one vacant month. Management fees could be €500 or more out of that per year.

http://www.daft.ie/searchrental.daft?id=1357025

yoloc

Theres nice houses selling for 34k that would fetch 350 a month without the management fee. 4x30k=120k which leaves 15k for fee's and taxes(hopefully change for a wee holiday). 4 x 350 a month = 1400 a month before tax. IMO, thats not a bad deal to tie up my money for a decade or more. This would be a nice wee top up to my wages and i could re-mortgage when the market's in a better shape and buy more properties.


http://www.daft.ie/searchsale.daft?id=717832


http://www.daft.ie/searchsale.daft?id=714098


I know the price is saying 34 and 35k on here but could see them accepting a 30k seeing as its been on the market for awhile and not to forget the property market because not many people pay asking price now

pwurple

I assume this is inheritance or something...

There are a few things to consider when you are calculating the income from this.

NPPR is 200 euro per year per property.
PRTB is 90 euro per tenancy

You will possibly need to employ an accountant if you don't already, that's a few hundred a year.

You will pay income tax on any rent, and USC. That's half of the rent gone in tax.

You can't assume full occupancy, tenants come and go. 70% occupancy might be reasonable, but it depends on your area.

Advertising fees for finding new tenants. Check out the pricing on daft. What is the profile of the renters in the area? Is it students who go after one year, or families who stay for 4 or 5 years? The more often the tenant changes, the more expensive it is for you.

Insurance. Landlord insurance is different to ordinary house insurance.

Repairs and maintenance. All property requires maintenance. Can you do it all yourself for 3 or 4 properties or will you need to hire someone?

It all eats into any income, you might find yourself just breaking even... Or worse, making a loss. Deposits rarely cover the damage a tenant can do. I once had to repair masonary and replace every door in a flat after the tenants had a domestic. Deposit came nowhere near the cost of the damage.

For me, i think it might be simpler and more cost effective to buy maybe one property in a higher rent area for around the 80k mark, and see how you go. Put the rest in a high rate deposit account (kbc do good ones). Then get another in a few years if things are going ok.

StillWaters

I agree with pwurple. Id buy one investment place in an urban area. Your plan sounds like a LOT of work and hassle.

OMD

pwurple wrote: »

I assume this is inheritance or something...

There are a few things to consider when you are calculating the income from this.

NPPR is 200 euro per year per property.
PRTB is 90 euro per tenancy

You will possibly need to employ an accountant if you don't already, that's a few hundred a year.

You will pay income tax on any rent, and USC. That's half of the rent gone in tax.

You can't assume full occupancy, tenants come and go. 70% occupancy might be reasonable, but it depends on your area.

Advertising fees for finding new tenants. Check out the pricing on daft. What is the profile of the renters in the area? Is it students who go after one year, or families who stay for 4 or 5 years? The more often the tenant changes, the more expensive it is for you.

Insurance. Landlord insurance is different to ordinary house insurance.

Repairs and maintenance. All property requires maintenance. Can you do it all yourself for 3 or 4 properties or will you need to hire someone?

It all eats into any income, you might find yourself just breaking even... Or worse, making a loss. Deposits rarely cover the damage a tenant can do. I once had to repair masonary and replace every door in a flat after the tenants had a domestic. Deposit came nowhere near the cost of the damage.

For me, i think it might be simpler and more cost effective to buy maybe one property in a higher rent area for around the 80k mark, and see how you go. Put the rest in a high rate deposit account (kbc do good ones). Then get another in a few years if things are going ok.

You forgot to add repair damage caused by floods. Cheap properties beside Shannon in Carrick means they will be/ have been flooded

The_Conductor

OMD wrote: »

You forgot to add repair damage caused by floods. Cheap properties beside Shannon in Carrick means they will be/ have been flooded

It doesn't mean that they have been or will be flooded.
It is indicative of the fact that there are over 4000 vacant properties there though.
The over supply of property in Carrick-on-Shannon is a known phenomenon- and delegations from Poland and some other countries have visited the town for a lesson in what happens when planning goes awry.

Unfortunately Poland don't seem to have learnt a lot from it (given their rather interesting relationships with developers/builders and most interesting of all- road builders).........

There is a quite stupendous over supply of property in Carrick-on-Shannon.

zef

Would I take the gamble at buying 3 low rental properties in carrick?
Not as a cash buyer, if I were you I'd think about buying in Dublin, You could get 1000+ p.m in rent in Blanchardstown, Tallaght, or those artisian houses in Dublin 7, good few of those for sale, and they rent well.
You'd get a decent enough house, maybe even with a bit of personality- some nice cottages/dormers in clonsilla . Those apts leave me cold.

djimi

You really need to suss out the rental market before embarking on this. If I had my mind set on living in Carrick then why would I shell out €300-€400 a month on rent when I could buy the place with a small deposit and a credit union loan?

D3PO

sounds an awful investment. the yield at 350 a month rental even with full occupancy taking into account tax, property tax, prtb registrations, management fees and possibly accountants fees, letting agent fees etc

at best your looking at 4% theres much easier and less stressfull ways to make 4% on 130k and that's being generous as I very much doubt you would have full occupancy in these and realistically a yield of under 3% would most likely be realized.

when you can get 35% over 10 years with a national solidarity bond 3.05% AER with no risk and no hassle why the hell would you even contemplate this.

Being a LL is not a bed of roses, if your not making 7% plus then then its a very questionable investment.

Victor

pwurple wrote: »

NPPR is 200 euro per year per property.

You might have heard of this new-fangled local property tax

The_Conductor

Victor wrote: »

You might have heard of this new-fangled local property tax

Thanks Victor- I really needed a laugh

pwurple

Victor wrote: »

You might have heard of this new-fangled local property tax

Hah, sorry... Was looking over my pre-property tax books!

Nppr replaced by the new shiny and even more expensive property tax.

StillWaters

pwurple wrote: »

Hah, sorry... Was looking over my pre-property tax books!

Nppr replaced by the new shiny and even more expensive property tax.

Not always, certainly in OPs case, the new property tax is much cheaper.

Hannibal Smith

If its an apartment there will be service charges to the management company too. And if its a bank selling it...are thr management company still even in existence? Have the common areas been transferred over or are they still owned by a now non existent development company?

jank

yoloc wrote: »

Theres nice houses selling for 34k that would fetch 350 a month without the management fee. 4x30k=120k which leaves 15k for fee's and taxes(hopefully change for a wee holiday). 4 x 350 a month = 1400 a month before tax. IMO, thats not a bad deal to tie up my money for a decade or more. This would be a nice wee top up to my wages and i could re-mortgage when the market's in a better shape and buy more properties.


http://www.daft.ie/searchsale.daft?id=717832


http://www.daft.ie/searchsale.daft?id=714098


I know the price is saying 34 and 35k on here but could see them accepting a 30k seeing as its been on the market for awhile and not to forget the property market because not many people pay asking price now

\
Oh dear god, here we go again.... Put your money into a high yeild term deposit or ETF. Much less stress. As mentioned if you fancy yourself as a landlord buy one and see how it goes...

Henry Ford III

These properties are priced as they are for good reasons.

StillWaters

If you want a punt on Irish property without the hassle of being a Landlord you could look into REITS

http://m.europe.wsj.com/articles/a/SB10001424127887324170004578637962656872002?mg=reno64-wsj#