About to rent our house. So many questions!

Whispered

See I would understand if someone stayed while looking for alternative accommodation, and would be happy to facilitate, but we couldn't afford to pay the mortgage here and our own rent, for long. This is my main fear. It's not about the house being or not being our "home".

I'd imagine agents have checks they can do on people to minimise the chances of that happening?

Wondering now if short term leases would be best way to go. Air b&b and the likes.

ED E

Whispered wrote: »

Wondering now if short term leases would be best way to go. Air b&b and the likes.

Will your insurance / mortgage allow that? Also your neighbours will probably end up hating you if you ever move back after AirBnBing it. With the best will in the world you will get some disruptive guests. In a quiet settled area that doesn't go down well.

Whispered

ED E wrote: »

Will your insurance / mortgage allow that? Also your neighbours will probably end up hating you if you ever move back after AirBnBing it. With the best will in the world you will get some disruptive guests. In a quiet settled area that doesn't go down well.

Very true. Just thinking out loud really. Our neighbours both sides are great.

My husband just told me to stop panicking about things that might go wrong.

Is it normal to contact a few agents and see who you want to manage things or are they all pretty much the same?

K.Flyer

Whispered wrote: »

Very true. Just thinking out loud really. Our neighbours both sides are great.

My husband just told me to stop panicking about things that might go wrong.

Is it normal to contact a few agents and see who you want to manage things or are they all pretty much the same?

If you do have great neighbours and are planning on moving back at some point in time, then you need to do this right to keep them onside, they can also be your watchful eye for you, so maybe let them know your plans upfront.

From my years of experience dealing with numerous estate agents the answer is No, they are not all pretty much the same, some are generally better than others.

I would be looking for a company that have different people looking after different aspects of your property, e.g. The person that shows it, is not the person dealing with maintenance, who is not the person dealing with the finances etc etc.
So bigger can be better that way, as can small and personal as long as they are efficient and not over stretched.
So, yes, contact a few and get a feel for the services that they provide.
My warning would be to avoid anyone who has the same handyman who looks after plumbing / heating / electrics / repairing appliances etc. "Jack off all, master of None"

purcela

If the house is in Dublin another option could be to rent to a multi national like Facebook or Google, they might use it to house staff. I'm not sure how you would go about this but I have heard of it in the past.

Whispered

It's in Kildare so I don't think that would be an option. Thanks for the suggestion though!

Claw Hammer

Whispered wrote: »

See I would understand if someone stayed while looking for alternative accommodation, and would be happy to facilitate, but we couldn't afford to pay the mortgage here and our own rent, for long. This is my main fear. It's not about the house being or not being our "home".

I'd imagine agents have checks they can do on people to minimise the chances of that happening?

Wondering now if short term leases would be best way to go. Air b&b and the likes.

Unless it is holiday letting, the RTA applies. Air B & B is highly location dependent. Most tourists want town centre destinations. The fly in/fly out tourists don't want to negotiate car rentals, public transport schedules from remote areas or pay taxis to get home at night. Air B 7B is also a lot of work as cleaning has to be done frequently, furniture has to be maintained, broadband is a must and all appliances have to be in perfect working order. Keys have to be transferred at the start and end of each visit.
Some agents are thorough checking references. Some are not. One landlord I know discovered, after 2 years that his agent had given 2 leases, 1 to show the Social Welfare and 1 to show him! He got the full money every month and the agent signed the welfare forms. He didn't even know welfare was paing towards the rent!

Whispered

Yeah Air B&B was just thinking out loud really. It's not a runner. I've gotten some personal recommendations for an agent in my area who is reasonably priced so I think I'll go with him. Moving date start June, all feeling real now.

Now to get the house into a rentable condition.

TanyGray

Its already very hard to get your own house back from a tenant when you want to.
Im willing to bet that within the year the minister will have another brainwave and at the stroke of a pen landlords will never be able to get thier properties back if they want then under any circumstances. Not only that but they wont be allowed to sell up either.

Thats why we have decided that we are doing airbnb now. And if that doesnt work out we are just leaving empty until such a time as the landlord is treated fairly, which may never happen.

kennethrhcp

Whispered wrote: »

Yep of course. Have mentioned that we are considering hiring an accountant to set us up with that. I have a tax return to do for last year anyway so might just have someone do both at the same time.

Is there a set rate or does it depend on tax credits etc

Also does renting out the house have an affect on TRS?

I don't think anyone has answered this from my quick read through... TRS would be stopped from when the house is no longer your PPR. Revenue have a section dedicated to recouping TRS incorrectly claimed. its up to you to inform your bank & revenue.

in relation to tax, I don't mean to frighten you but it could be as much as 52% (depends on your other income) of the net profit. def worth talking with an accountant before making your decision

TanyGray

kennethrhcp wrote: »

I don't think anyone has answered this from my quick read through... TRS would be stopped from when the house is no longer your PPR. Revenue have a section dedicated to recouping TRS incorrectly claimed. its up to you to inform your bank & revenue.

in relation to tax, I don't mean to frighten you but it could be as much as 52% (depends on your other income) of the net profit. def worth talking with an accountant before making your decision

Don't forget CGT is liable too if you ever sell the house after it has been rented.
You will be taxed up to the eyeballs once you rent that house. Even after you have finished renting it.
And if you ever lose your job that rent will be deemed income and the house an investment when they calculate your unemployment.

And if you do get a so called rogue tenant who decided to stay there and not pay rent you'll also have to keep the place nice for them.

Whispered

Another question from me!
According to an agent I spoke to, HAP tenants are tax free. Also mentioned that if they fail to pay they loose their place on the HAP scheme so there is a bit more security there. She said that they still do all relevant checks and would recommend the tenant they feel would be best, HAP or not.

Is that a true assessment?

I'm waiting on an accountant to get back to me about tax but trying to come up with a ballpark figure in the meantime. I know rates can vary significantly so would there be and simple formula I could use to come up with an approx figure of how much tax we'd pay per month.

The_Conductor

Whispered wrote: »

Another question from me!
According to an agent I spoke to, HAP tenants are tax free. Also mentioned that if they fail to pay they loose their place on the HAP scheme so there is a bit more security there. She said that they still do all relevant checks and would recommend the tenant they feel would be best, HAP or not.

Is that a true assessment?

I'm waiting on an accountant to get back to me about tax but trying to come up with a ballpark figure in the meantime. I know rates can vary significantly so would there be and simple formula I could use to come up with an approx figure of how much tax we'd pay per month.

100% of your mortgage interest is tax free with a HAP tenant.
You still have to pay tax on the rental income!!!!

If a HAP tenant fails to pay their portion of the rent to the council/local authority- they loose their place on the HAP scheme- however, the local authority who are paying you- stop the payment in full- not just the portion of the rent that the HAP tenant pays. So you end up with a HAP tenant in your property- who is kicked off the scheme- has no-where to go- and you can't get rid of them- despite the fact that they're not paying rent (and are incapable of doing so)- and you have served valid notice on them.

If/when they do eventually move on (in 18 months- 2 years time)- they'll have built up a large amount of unpaid rent- which you'll never see- however, your best case scenario is that they don't destroy the property.

Honestly- it sounds like the estate agent has someone they'd like to house- and are trying to make them sound as good as possible to you- without telling you any of the downsides whatsoever.

A HAP tenant- has nothing to loose- even if they get kicked off the scheme- you're still not going to be able to get them to leave- and you'll not get any rent- despite the local authority having paid the lions share of the rent on their behalf.

TanyGray

Whispered wrote: »

Another question from me!
According to an agent I spoke to, HAP tenants are tax free. Also mentioned that if they fail to pay they loose their place on the HAP scheme so there is a bit more security there. She said that they still do all relevant checks and would recommend the tenant they feel would be best, HAP or not.

Is that a true assessment?

I'm waiting on an accountant to get back to me about tax but trying to come up with a ballpark figure in the meantime. I know rates can vary significantly so would there be and simple formula I could use to come up with an approx figure of how much tax we'd pay per month.

Well thats one estate agent you need to steer well clear of. Lying to you before they even got the gig. Stay well clear.

Spanish Eyes

I don't know the circumstances of you moving to relative's house and letting out your own, but I am sure you have considered letting out relative's house INSTEAD of your own?

Maybe rel house is bigger, closer to work, creche etc. I dunno. Seems easier in a lot of ways though, and your own house is still your own without any tenant issues.

Whispered

It does make sense if it wasn't for the fact that it'll be a total lifestyle change we want. The move will allow us that.

mrslancaster

4ensic15 wrote: »

If the term is longer than 6 months, Part 4 starts anyway. The expiry of a lease does not terminate the tenancy.

This is probably obvious to many or may have been asked before so apologies.

Can anyone tell me if that is 6 calendar months or does the 6 months run from the first day of the tenancy?

Say a tenant moved in on the 15th February, does the 6 months start then or on the 1st March?

TanyGray

mrslancaster wrote: »

This is probably obvious to many or may have been asked before so apologies.

Can anyone tell me if that is 6 calendar months or does the 6 months run from the first day of the tenancy?

Say a tenant moved in on the 15th February, does the 6 months start then or on the 1st March?

I was working off calendar months anyway.

We finally put ours up on Airbnb and requests for bookings have flown in already even though I didn't think it was a major Airbnb area.

What really has me awake now pondering is two requests for entire blocks of 6 months via Airbnb.
That sounds very attractive to me , but trying to think of all the pros and cons before accepting any requests at all.

6 months Airbnb let's would be great. No rtb monkey on my back, garuateed rent for 6 months, more control of our property.

Have to think very hard about this.

mrslancaster

Another thing that I can't find an answer to is this situation:

The landlord is upgrading / doing substantial works & gives correct notice & the tenant moves out.

When the work is finished & the same tenant moves back in, is that a completely new tenancy for Part 4 / notice period purposes or is it a continuation of the previous tenancy?

TanyGray

mrslancaster wrote: »

Another thing that I can't find an answer to is this situation:

The landlord is upgrading / doing substantial works & gives correct notice & the tenant moves out.

When the work is finished & the same tenant moves back in, is that a completely new tenancy for Part 4 / notice period purposes or is it a continuation of the previous tenancy?

I understand it's a new one.

I wouldn't bother myself with upgrading to get off the rent cap. Some guy in rtb can arbitraily decide that you have just wasted your time and money.

The whole scene is a disaster zone TBH.

joeguevara

Read the op and I apologize I didn’t read the rest of the posts. I have one piece of advice that I have learned through experience.

Don’t rent out your house to anyone that is connected to a friend, neighbor or family. You will be conflicted and feel pressurized to do things that you would not do to a simple tenant.

If you can, get a propert agent who will take care of everything, including organizing repairs, collecting rent etc. this will probably cost about 1.5 months to 2 months rent but is worth it.

Being a landlord is a disaster. The tax system ensures you make a loss and the protections of tenants means that if they refuse to pay you are going to be at a severe loss. Make sure vetting is completed and follow through with due diligence including contacting employers and past landlords.

The_Conductor

Honestly- if you want to move back into the property in a years time- the way the regulatory system is setup- you're better off getting a caretaker to look after the property for the duration while you make your mind up as to whether you want to make the move permanent or not.

joeguevara- has a very valid point- if its friends of your neighbours who you're lining up to move in- it pretty much doesn't matter what happens- you're in for a whole lot of mess and hurt all round- just don't do it.

The only thing that makes sense- if you're letting your house- is that you are accepting it is no longer your home, and you have no intention of moving back to it.
This whole notion of taking a year to decide- is fraught with all manner of danger- the obvious one being its staggeringly likely that you'll not be able to get a tenant to move on after a year (even if they stop paying rent).

How about keep the property vacant for the duration- look up caretaker agreements Ireland- essentially you hand the property over rent-free to someone who agrees to look after in lieu of paying rent- but they don't have any tenancy rights and can be asked to leave if/when you decide you want the property back.

The joker in all of this- is the manner in which you might decide to move back in a years time. If this was not the case- I'd still be advising you not to rent out the property- however, I'd be suggesting your better course of action is to sell.

There is a cost associated with you keeping your options open- the concept of it having a cost though- is something that you very obviously have not considered.

Whispered

The house is in negative equity and cannot be sold. Beyond that there is not a lot to consider with regards to rent or not rent. Our options are: stay put in a house which we no longer want to live in, or, take the risk and rent it out and hope that we get decent tenants and that we settle well in our new house so don't need to come back to this one.

The_Conductor

Whispered wrote: »

The house is in negative equity and cannot be sold. Beyond that there is not a lot to consider with regards to rent or not rent. Our options are: stay put in a house which we no longer want to live in, or, take the risk and rent it out and hope that we get decent tenants and that we settle well in our new house so don't need to come back to this one.

What happens when you get tenants in- and they stop paying their rent?
This is a legitimate concern- and is the single largest number of issues reported to the RTB in the last 12 months.

I'm really sorry that you're in negative equity- but you really are looking at this with the most amazing rose tinted glasses- you're seeing all the possible upsides- and none of the risks.

The fact that you no longer wish to live in the property- is a complicating factor- however, its only one factor in the equation. You need to be brutally honest with yourself when you're evaluating the pros and cons of what you're considering.

The complete joker in this- is a suggestion that you're going to take a year out and see if you enjoy an alternate lifestyle- and might move back into the property at that stage. That proposal- is completely and utterly bonkers- on so many different levels.

If you cannot sell (and I'd suggest you get proper advice on this- some lenders are running a version of 'Jingle Mail'- that is- handing property in negative equity back to the bank)- you 100% certainly should not have any expectation that you'll have tenants in there for a year who are going to take care of your furniture, fixtures and fittings- and happily wave goodbye to you at the agreed point in time.

Before anyone mentions fixed term leases- they're not worth the paper they're written on- and any tenant has full Part IV protection in THEIR home- after 6 months- regardless of whether they have signed a fixed term lease or not.

OP- if you are certain you do not want to live in the property- and have alternate arrangements that you are certain you're happy with- SELL THE PROPERTY- come to some sort of arrangement with the bank/mortgage holder re: negative equity- even the new insolvency Act has provisions that might be of interest to you. Becoming a landlord- is not a quaint past-time that you do for an hour or two every Saturday morning- and no tenant is going to consider your house to be anything other than THEIR HOME- and good luck to you if you think it will ever be your home ever again.

You need to sit down- and evaluate this properly- and you also need to consider what being a landlord actually entails- and whether cutting your losses is perhaps a better option.

As it stands- I can't see any merit whatsoever in what you're suggesting- but the real knock-out factor- is that you're viewing it as a temporary situation while you decide whether you want an alternate lifestyle- perhaps down the country or something- and *might* want to move back in a years time- if you decide that actually, you're not able to cut it as farmers (which is damn hard work- I grew up on a farm- and talk to farmers on a daily basis).

You are viewing this through rose tinted glasses- I'm trying to be kind in how I'm telling you that you're not being honest with yourself- but all your doing is swapping one problem- for another one- without any guarantee you can return to the first problem, when you discover the grass isn't necessarily greener on the other side............

TanyGray

OP, Why not try Airbnb for a while?

4ensic15

TanyGray wrote: »

OP, Why not try Airbnb for a while?

That has been dealt with earlier in the thread. The majority of lettings work out reasonably well. OF the several hundred thousand tenancies registered with the RTB, only a small percentage get to the dispute stage. Of those, many of the disputes are deposit related. Of the overholding cases, not all are rent arrears cases.

TanyGray

4ensic15 wrote: »

That has been dealt with earlier in the thread. The majority of lettings work out reasonably well. OF the several hundred thousand tenancies registered with the RTB, only a small percentage get to the dispute stage. Of those, many of the disputes are deposit related. Of the overholding cases, not all are rent arrears cases.

Only takes one bad experience to cost you a years wages with rogue tenants though.

I think Airbnb is easier and less risky regardless.
I have an agent lined up for mine. They will do the meet and greets, checkouts etc. They take half of the cleaning fee and get a cleaner to clean it for the other half of the cleaning fee. Easier than I thought TBH. Though I cant tell you how it turned out as it hasnt started yet.
I was going to do the first few myself and then hand over to the agent, but now im thinking about accepting 6 month blocks.

Have to work out the pros and cons

Whispered

Air bnb isn't an option.

Theconductor. I appreciate you're trying to be kind. I'm not going into any more detail of the reasons behind the move or where we are moving to. At this stage the decision has been made.

I've all the info I need now. Thanks all