Letting our house while on market

Cheeseplant

Having some thoughts of moving area at the moment.

Selling our house might take a while and we would have to sell it to buy in the new area.
I'm giving consideration to letting our place out and renting in the new area while our house is on the market.
Can anyone who has done this point out all the potential headaches??
With current market wobbles it could take 5-6 months to sell our house at a price we would want. Can we let it to tenants under the condition that once it goes sale agreed they have their 3 months notice?

corner of hells

Cheeseplant wrote: »

Having some thoughts of moving area at the moment.

Selling our house might take a while and we would have to sell it to buy in the new area.
I'm giving consideration to letting our place out and renting in the new area while our house is on the market.
Can anyone who has done this point out all the potential headaches??
With current market wobbles it could take 5-6 months to sell our house at a price we would want. Can we let it to tenants under the condition that once it goes sale agreed they have their 3 months notice?

I sold a house recently, during the process the estate agent suggested letting it for short term lets, month by month.He said hed look after the letting and any potential viewings too saying multinationals regularly want short term.lets for staff in Ireland on contracts.
I didn't do in the end as the house went sale agreed quickly .

Darc19

Short term airbnb or corporate only.

Do not rent on general market. A bad tenant could be a nightmare.

But you may find that if you price properly, you'll get your buyer.

10% below what you previously expected and likewise look at buying 10% below too.

ted1

Short terms key. Strictly no longer than 5 months.
My advice would bar to get people who are renovating a house, and have some where definitely to move to.
You don’t want to tenants that won’t move out.

Cheeseplant

corner of hells wrote: »

I sold a house recently, during the process the estate agent suggested letting it for short term lets, month by month.He said hed look after the letting and any potential viewings too saying multinationals regularly want short term.lets for staff in Ireland on contracts.
I didn't do in the end as the house went sale agreed quickly .

Was your agent doing all this for the sales fee or extra?

Cheeseplant

Darc19 wrote: »

Short term airbnb or corporate only.

Do not rent on general market. A bad tenant could be a nightmare.

But you may find that if you price properly, you'll get your buyer.

10% below what you previously expected and likewise look at buying 10% below too.

:eek: 10% means we probably couldnt afford the deposit on the new place :pac:

Sunrise_Sunset

I agree with short term or corporate lettings.
Our apartment was rented when we sold it. The tenants had been there about a year. They weren't very accommodating during the sale and viewing process.

corner of hells

Cheeseplant wrote: »

Was your agent doing all this for the sales fee or extra?

We never got as far as letting it , the house went sale agreed and sold quicker than we expected.

cnocbui

I presume there is no capital gain expected so loosing the family home status tax exemption isn't a worry?

Peter File

cnocbui wrote: »

I presume there is no capital gain expected so loosing the family home status tax exemption isn't a worry?

You have to sell it within 12 months of moving or you lose the PPR relief

cnocbui

Peter File wrote: »

You have to sell it within 12 months of moving or you lose the PPR relief

I know. And you don't get it later if you rent it out and then sell it.

Claw Hammer

Cheeseplant wrote: »

Having some thoughts of moving area at the moment.

Selling our house might take a while and we would have to sell it to buy in the new area.
I'm giving consideration to letting our place out and renting in the new area while our house is on the market.
Can anyone who has done this point out all the potential headaches??
With current market wobbles it could take 5-6 months to sell our house at a price we would want. Can we let it to tenants under the condition that once it goes sale agreed they have their 3 months notice?

If you get tenants and have to register with the RTB you can't enforce the 3 month condition. You may also have difficulty with viewings since the tenants will have a right of quiet enjoyment and can mess you around regarding access. You will also have to guarantee the purchaser vacant possession and if the tenants act up and won't leave you may lose sales. Effectively you couldn't sign the contract on another property until the tenants are out.
Any letting you do should not be under the RTB.

Pivot Eoin

Cheeseplant wrote: »

:eek: 10% means we probably couldnt afford the deposit on the new place :pac:

Depends on if you're trading up or trading down. General Rule, when house prices are dropping (Probably Now) trade up as the gap between your sale price and the new house buy price is smaller.

Pkiernan

If a short term tenant refuses to leave after their agreed term, what is your plan?

Claw Hammer

Pkiernan wrote: »

If a short term tenant refuses to leave after their agreed term, what is your plan?

That is the point. A notice of termination has to issue after the tenant moves in. If it is wrong the tenant might end up becoming part 4. Unless it is hoiiday letting, it is very risky.

Brego888

Peter File wrote: »

You have to sell it within 12 months of moving or you lose the PPR relief

Do you still have to sell within 12 months if originally bought between December 2011 and December 2014?

https://www.citizensinformation.ie/en/money_and_tax/tax/capital_taxes/capital_gains_tax.html

"
Gains made on the disposal of property acquired between 7 December 2011 and 31 December 2014 can get relief from CGT in certain cases. However, this relief does not apply if the property was acquired by gift or inheritance. The relief applies to all property, whether residential or non-residential. To get this relief the property must be held for more than 7 years. If it is sold more than 7 years after acquisition and a gain is made on the sale, relief will be given for the initial 7-year holding period. For example, if the property was bought in January 2012 and sold in January 2022, the property would have been held for 10 years, so 7/10 of any gain will be relieved from CGT and 3/10 is taxable.

Gains made on the disposal of property acquired between 7 December 2011 and 31 December 2014 and held for more than 4 years but less than 7 years are exempt from CGT. However, this relief does not apply if the property was acquired by gift or inheritance. To qualify for this exemption, disposal of the property must take place on or after 1 January 2018. For example, any gain from a property bought on 1 June 2012 and sold on 1 July 2018 is exempt from CGT.

"

Pkiernan

Claw Hammer wrote: »

That is the point. A notice of termination has to issue after the tenant moves in. If it is wrong the tenant might end up becoming part 4. Unless it is hoiiday letting, it is very risky.

At a more basic level, if the tenant decides hes not leaving, what will you do?

You have no protections in ireland against rogue tenants

Darc19

Cheeseplant wrote: »

:eek: 10% means we probably couldnt afford the deposit on the new place :pac:

Market will drop. Many will hold out hoping they will get their price and then drop as they realise there's no option.

But it shouldn't affect those moving as the house you are buying should drop too.

afkasurfjunkie

How do you go about showing the house if their are tenants there? When you are there it’s in your best interests so you will have house tidied, fire lit, fresh baked bread in the oven etc. Tenants won’t be as bothered.

Cheeseplant

All in all it sounds like we would be best to tie and align the property stars and not letting the house
Thanks for all the replies!

dubrov

You'd also need to consider tax.

The taxman might take half your rent on your old place while you'd still have to pay full rent in your new place

Claw Hammer

Brego888 wrote: »

Do you still have to sell within 12 months if originally bought between December 2011 and December 2014?

https://www.citizensinformation.ie/en/money_and_tax/tax/capital_taxes/capital_gains_tax.html

"
Gains made on the disposal of property acquired between 7 December 2011 and 31 December 2014 can get relief from CGT in certain cases. However, this relief does not apply if the property was acquired by gift or inheritance. The relief applies to all property, whether residential or non-residential. To get this relief the property must be held for more than 7 years. If it is sold more than 7 years after acquisition and a gain is made on the sale, relief will be given for the initial 7-year holding period. For example, if the property was bought in January 2012 and sold in January 2022, the property would have been held for 10 years, so 7/10 of any gain will be relieved from CGT and 3/10 is taxable.

Gains made on the disposal of property acquired between 7 December 2011 and 31 December 2014 and held for more than 4 years but less than 7 years are exempt from CGT. However, this relief does not apply if the property was acquired by gift or inheritance. To qualify for this exemption, disposal of the property must take place on or after 1 January 2018. For example, any gain from a property bought on 1 June 2012 and sold on 1 July 2018 is exempt from CGT.

"

What is being discussed here is PPR relief rather that the special scheme which applied to investment properties.

Marcusm

Peter File wrote: »

You have to sell it within 12 months of moving or you lose the PPR relief

Let's just be clear, you do not lose the relief; it just begins to be time apportioned. Any taxable portion is related to the period for which it is not occupied as a principal private residence with a period of up to 12 months being disregarded. Live in it for 10 years then rent it for 2; only 1/12th of any gain is taxable. It really is not that much of a disincentive.

the_syco

The tenant may say they'll allow viewings, but change their mind once in the house.
They may also leave the place looking crap to put buyers off.
Furthermore, they may decide not to leave when you tell them to do.

Finally, no evictions are allowed at the moment. If you have tenants and have a buyer, the government may bring in the no evictions law again, preventing your sale as the buyers will go elsewhere.

Cheeseplant

Thanks to all for taking the time to reply but after much discussion we will stay put and see how things unfold for the moment.