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Need advice about buying in Dublin

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  • 20-02-2015 10:43pm
    #1
    Blue Iris
    Registered Users Posts: 70 ✭✭


    I moved out of Dublin 7 years ago with my family and while it's ok I'd love to move back. My kids are in secondary school though and I don't want to move them so will not be able to move for 5 years. But with prices going up I've been thinking of buying a 2 bed that can be used for college in a few years and rented out in the meantime.

    I feel I might not be thinking clearly about this and maybe I should just forget all about it and just be happy to rent when the time comes. We are mortgage approved but I don't want to make a foolish mistake. I'd appreciate any advice or suggestions.


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    #2
    evolving_doors
    Closed Accounts Posts: 11,812 ✭✭✭✭evolving_doors


    Just from talking to folk who rent/lease in the area I know the market is strong enough for demand anyhow.

    The thing is about D7 though is the variety of houses varies. So maybe just taking the white band houses 2bed in Cabra as a standard the listed rate is usually around the 200k to 250k mark (usually with a bit of upgrading needed).
    The rental is usually around the 1,300 mark (e.g. HERE).

    In the most recent daft rental report infographic(here) the mortgage vs' rental is €896 vs €1,113 respectivly ... so maybe throw in costs incurred/vacancy periods then it looks like you could break even (based on 30 yr mortgage 4.3% variable 85% LTV).

    So as an ordinary ignorant joe bloggs who has only his own house as a negative equity 'investment!' I'd say it might be worthwhile (leaving aside the whole 'being a landlord' hassle and the kids moving in during college factor).

    Then again you could spend a bit of money get the house up to scratch and lease it to the council for 10 years (they pay 80% of the local rental in the most recent daft report, rent review after 5 years )...

    I still think there's a bit of value to be got in certain areas of dublin if you have a good bit of money to stump up to bring the mortgage down and if you're prepared to put in the research time.


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    #3
    Blue Iris
    Registered Users Posts: 70 ✭✭Blue Iris


    Thanks for the information Armelodie. Good food for thought there. I need to do a bit more research. I'm getting a bit stuck trying to make a wise decision about it.


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    #4
    MarkAnthony
    Closed Accounts Posts: 6,934 ✭✭✭MarkAnthony


    Not 100% sure what you mean by used for college - for the kids? What happens if they don't get in where they want/decide to go to NUI Galway.

    Is your mortgage approved on a buy to let basis?

    Are you willing to put up with the massive arse ache that being a landlord?

    What tax banding do you fall into? If you take out 53% of your potential rental income (after expenses) does it come close to covering the mortgage?

    Just some food for thought.


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    #5
    Blue Iris
    Registered Users Posts: 70 ✭✭Blue Iris


    MarkAnthony wrote: »
    Not 100% sure what you mean by used for college - for the kids? What happens if they don't get in where they want/decide to go to NUI Galway.

    Is your mortgage approved on a buy to let basis?

    Are you willing to put up with the massive arse ache that being a landlord?

    What tax banding do you fall into? If you take out 53% of your potential rental income (after expenses) does it come close to covering the mortgage?

    Just some food for thought.
    Thanks for the useful questions. You're right about college. I'm making assumptions. The outgoings will be very high but on paper we should break even. I was thinking of using a management agency as we live 2 hours away so that would be more costs.

    I think I'm feeling nervous about never being able to live in Dublin again if prices continue to rise but I shouldn't be letting that influence my decision about this. This is why I'm looking for objective advice. Thanks to you both for replying.


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