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Renting-out Our Apartment

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  • 02-04-2014 2:15pm
    #1
    Sparkle*
    Registered Users Posts: 15 ✭


    Hi Guys, We have a two bed apartment (both bedrooms are tiny) and are hoping to have a second child and therefore would need to rent out our apartment and rent a house or 3 bed apartment to facilitate this. I gather from looking on sites that we would only have a shortfall of approx. €100 per month doing this on the mortgage but was just wondering if anyone has done this and has it worked? or is there any agreement you can come to with the mortgage lender as it isn't really as an investor but a must as we will need to fit in a cot that at the moment cannot fit into our apartment lol!!

    Any advice would be appreciated, thanks


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    #2
    Sparkle*
    Registered Users Posts: 15 ✭Sparkle*


    I will be renting and managing the apartment myself as I am qualified to do this and had worked at this in the past so that should help to keep the initial cost down!


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    #3
    Moonbeam
    Moderators, Education Moderators, Society & Culture Moderators Posts: 18,953 Mod ✭✭✭✭Moonbeam


    Sparkle* wrote: »
    I will be renting and managing the apartment myself as I am qualified to do this and had worked at this in the past so that should help to keep the initial cost down!

    The biggest cost is the tax on the rental income which depending on how much you earn can be very high .


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    #4
    Claw Hammer
    Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    The banks in general will pull up the interest rate once a property becomes let. The only way to avoid that is not to tell the original lender and get a mortgage on the new house from a different bank.


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    #5
    Stheno
    Moderators, Business & Finance Moderators, Science, Health & Environment Moderators, Society & Culture Moderators Posts: 51,688 Mod ✭✭✭✭Stheno


    OP is the €100 shortfall that you mentioned after you have calculated how much tax, prsi and usc you will have to pay on the rental income?

    If it's not then you need to factor that in as if you are on the higher rate of tax that's a fair whack you will have to pay


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    #6
    athtrasna
    Closed Accounts Posts: 13,420 ✭✭✭✭athtrasna


    Stheno wrote: »
    OP is the €100 shortfall that you mentioned after you have calculated how much tax, prsi and usc you will have to pay on the rental income?

    If it's not then you need to factor that in as if you are on the higher rate of tax that's a fair whack you will have to pay

    Add in property tax, PRTB registration, management fees, insurance..being a landlord is an expensive business if you bought at the wrong time. Remember tax, prsi & usc are payable on the income less allowable deductions, not on the "profit" (if there is any).


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