Landlord looking for advice.

marieholmfan

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Mod

Quit the trolling

Old diesel

OP - when you say they've been in the property 4 years - has the actual 4 year anniversary (4 year pre 2016 changes part 4) come and gone yet.

For example was it October 2015 they moved .

From what I can see - IF.....

You issue the notice of termination BEFORE the end of the part 4 tenancy but the notice period ends on or after the part 4 ends.

Then you don't need the normal specific reasons set down for termination of a part 4 tenancy.

Dinarius

Old diesel wrote: »

OP - when you say they've been in the property 4 years - has the actual 4 year anniversary (4 year pre 2016 changes part 4) come and gone yet.

For example was it October 2015 they moved .

From what I can see - IF.....

You issue the notice of termination BEFORE the end of the part 4 tenancy but the notice period ends on or after the part 4 ends.

Then you don't need the normal specific reasons set down for termination of a part 4 tenancy.

Thanks.


I don't think we want to terminate. They're good tenants for the most part.


The problem now is we're faced with a large bill for a bathroom refit, and (tax deductible or not) it will take a few years to claw back.


If we changed tenants and did the refit during the changeover, we'd lose a months rent plus the cost of the refit.


If we refit while they are on holidays, we might be better off in the long run.


Thanks again.

D.

py

Have you looked to see if this would be covered under your insurance?

Fol20

I would treat this similar to running a car
- expect to pay out for some jobs every now and again. I would take out 15pc per month for a maintenance budget. Some years. You might have very little. Others years, they might be painful for your bottom line.
- if your worried that the tenant isn’t reporting it on time, you need to be more proactive and do routine maintenance( quarterly inspections) > this would enable you to stop a bigger issue from happening. I don’t do this myself but if a cooker or similar worries you. It might be better to do. In my case this year. Iv has a washing machine break down within 13 months. A bed breaking with 14months of being new but these are just accepted expenditures.
-your better off doing this with tenants in situ, no downtime and you get the job done.


Personally based on your comments so far, it might be better if you sell or hand off to an agent. These types of issues are extremely common and shouldn’t phase you. In one weekend last year I had 3 separate leaks and you just get on with things.


Another point to note is an agency taking over management. It’s not relevant to how much your rental income is. They normally take a percentage of between 5-10pc of your gross income a month so if you only earn 1k or 3k it’s still the same percentage. It’s tax deductible also. In your case they may take about 125e per month which is also about 60net and you can then avoid all the hassle and heartache of knowing all the legislation.

Dinarius

py wrote: »

Have you looked to see if this would be covered under your insurance?

Very good point. Will do.


Thanks.

D.

Dinarius

Fol20 wrote: »

Another point to note is an agency taking over management. It’s not relevant to how much your rental income is. They normally take a percentage of between 5-10pc of your gross income a month so if you only earn 1k or 3k it’s still the same percentage. It’s tax deductible also. In your case they may take about 125e per month which is also about 60net and you can then avoid all the hassle and heartache of know all the legislation.

Thanks for the reply.


My point was that it's very relevant how much my (rental) income is. 10% of our €1250, when it's below market average, is a lot.


To be honest, in 14 years of letting, we've had very little in the way of hassle. The timing and scale of the problem this time are both terrible! Stuff happens, I guess.



Thanks.

D.

Fol20

Dinarius wrote: »

Thanks for the reply.


My point was that it's very relevant how much my (rental) income is. 10% of our €1250, when it's below market average, is a lot.


To be honest, in 14 years of letting, we've had very little in the way of hassle. The timing and scale of the problem this time are both terrible! Stuff happens, I guess.



Thanks.

D.

Completely understand what your saying. Similar to insurance. Hopefully you will have another 14 years of hassle free tenants however it’s that “one” tenant that can cause mayhem for you and if your not up to par in knowing the rules or how to play the game, this is when a tenant can really take advantage of a situation and when knowing a good ea can prove very useful.

I manage mine also but if it’s just for one place , it may make more sense to just offload the work for 700 net a year.

Even if they are good tenants, I would have a friendly chat with them that you’d love to keep the rent the same however all this legislation and the implications of the RPZ are forcing my hand. Increase by the max level until you get it somewhat close to market level. If you go onto the RTB website, they have an rpz calculator. If you haven’t increased it for years, you might be entitled to increase by my more than 4pc depending on time frame.

Spanish Eyes

Bear in mind, that if you decide to sell, the notice periods for Landlords have increased substantially since June 4th this year. Just a heads up.

https://onestopshop.rtb.ie/ending-a-tenancy/notice-periods-that-a-landlord-should-give/

Dinarius

Spanish Eyes wrote: »

Bear in mind, that if you decide to sell, the notice periods for Landlords have increased substantially since June 4th this year. Just a heads up.

https://onestopshop.rtb.ie/ending-a-tenancy/notice-periods-that-a-landlord-should-give/

Thanks for that.



Is it any wonder the rental market is screwed?



There is every incentive to sell and leave it or switch to AirBnB type rental.


When I'm mortgage free, mine will provide a small pension. At that stage I'll probably want to offload it to an agency also.


D.

The_Conductor

OP- its very hard to make any suggestion other than to sell.
You're locked into a rent level of considerably below market rate.
The market has peaked.
The tenants, while they're not bad, have probably caused thousands in damage (I put a reclaimed oak floor in a property last year- the materials alone, despite being reclaimed- came to 12k- thankfully, it wasn't my money.........)
You have an emotional attachment to the apartment- which simply put, is a massive hindrance to letting it. You've also let it with remarkably high specifications (such as the aforementioned oak floor)- which tenants do not appreciate- or treat with the respect that they deserve.
Damage to the floor alone- could very well be thousands (and you have the bathroom refit etc to factor into the equation too).

Its very hard to suggest that its a good idea to continue letting this property- the best decision you probably could make, cognisant of the fact that you're locked into a rent level below market rates- is to sell.

beauf

If you have a mortgage on something else have to consider if selling the property and clearing all mortgages costs you less tax than paying the tax on the rental income

Dinarius

beauf wrote: »

If you have a mortgage on something else have to consider if selling the property and clearing all mortgages costs you less tax than paying the tax on the rental income

Interesting point. We have mortgage on both apartment and house. Both variable rates. But, both mortgages are at the same residential variable rate. The apartment mortgage is not at a buy to let rate.

Selling apartment would just about clear both mortgages, after paying capital gains.

Thanks.

D.

Dinarius

The Student wrote: »

They are entitled to stay in the property for six years so you wont be able to renew on a monthly basis (welcome to the landlords world).

You can only terminate the tenancy for one of the three reasons. In my view I think you have a few options either sell the property or have more inspections. For what its worth I would be advising the tenant the cost of the replacement of the floor would be coming out of their deposit.

They have a responsibility to advise you if there are any leaks etc. They are not obliged to fix the leaks but if you don't know they exist how can you mitigate their damage.

If you are going to keep the property I would reiterate to the tenants their responsibilities and get the tenants to pay for the floor damage.

PM sent.

Thanks.

D.

The_Conductor

Dinarius wrote: »

Selling apartment would just about clear both mortgages, after paying capital gains.

Sounds like a very enviable situation to be in, to be honest.
I'd strongly encourage you to take this course of action.

beauf

One long term view is to sell up, then buy back into the market a more suitable and profitable rental property once the market has eased in a year or two. I'm not expecting the prices to fall that much, but I am expecting a rent freeze, and if that happens the only way to set a reasonable rent (if you are locked into a low rent) will be to come to the market with a new rental. I wouldn't expect to make any money from buying and selling, just that you'd re-position yourself better. of course it depends if you can get a mortgage, and your own income can change and scupper that plan.

Maybe thats a lot of hassle, and the plan should be to just pay out the expenses and continue to rent as is. Just accept a more modest return.

ste

Dinarius wrote: »

Thanks.


I don't think we want to terminate. They're good tenants for the most part.

Also you say you haven't updated in 14 years. The work you need done now is perhaps bad enough timing personally but in the scheme of things if you look at how much maintenance cash you spent (net,tax deduct.) I think you'll see you're doing rather well.

Also ppl commenting on the quality of interiors in there, it's because you lived there for 5 years. Fair play for buying high quality gear.

my advice is get over the bit if the shock of a big outlay & keep trucking. Max out annual rent increase & prepare for other maintenance hits in years to come.

If it's worth while get an agent & suck up cost for a slightly easier life.

Good luck

marieholmfan

Dinarius wrote: »

ISelling apartment would just about clear both mortgages, after paying capital gains.

Do it.
You have to let out either five apartments or zero and they have to be in the same town.