Sell or rent out?

colinmis

Hey

Looking for a bit of advice on what to do. My wife is from the North and and we have recently decided to move there permanently. We have about €115k of a mortgage left on a house valued around €450k in. We fixed at 1.95% last summer so have about 6 years left to run on that rate.

We're not sure if we should sell the house and use the equity as a large deposit on a house up there and only have a small mortgage or rent out the house. Mortgage repayments are around €860 and similar houses in the area get €2,500 a month. We have enough savings to be able to put a 20% deposit on a house up there but obviously this would leave us with a much larger mortgage then if we were to sell this house.

I haven't looked into the tax situation, given we'll be permanently living outside of Ireland, does anyone know what it would be?

If we were to rent it out, would people recommend a letting agent to manage it or just do it ourselves?

thanks in advance

Seth Brundle

If you rent then expect bugger all, if any, profit after tax. Plus if a tenant decides not to pay rent and you have to cover the mortgage on the property plus still pay for repairs while the non-paying tenant is there (because you are legally prevented from evicting them), will you be able to afford those couple of years?

DownByTheGarden

Sell it and invest the money when you are resident up North. Way better treatment of investments there and besides anyone with any sense wouldnt be a landlord in Ireland.

RichardAnd

Isn't there an option to rent a house to the council? As I understand it, they council will take care of the paper work, maintain the property and just hand over just under the market rate of the rent to the owner?

Del2005

https://www.boards.ie/discussion/comment/121037759#Comment_121037759

If search worked you'd find plenty of threads about this. They put their worse tenants in these rentals.

We have some of the highest rents in Europe and private landlords are selling up as soon as they can get vacant procession. Being a small landlord in this country is a mugs game.

DownByTheGarden

https://www.boards.ie/discussion/comment/121037759#Comment_121037759

That option is all well and good if your neighbors dont have your phone number.

The council put horrible people in them, neighbors only avenue of complaint is to you, but youve signed the house over and have no say anymore.

You then ring the council and they say talk to the hand.

Now all your old neighbors hate you like the divil.

herbalplants

SELL. Nothing good about renting your home.

Remember you will pay tax too.

CPTM

Isn't there another major factor here which is capital gain tax? If you sell now, assuming it's your primary home, you don't need to pay capital gains. But if you rent it and sell later, my understanding is that you would pay tax on any increase in value between when it was your primary residence and when you go to sell it.

So if you are keeping it, it might be good to get an evaluation done (valued as high as possible) so that when you go to sell it, you can refer back to that evaluation whenever you to to sell it so that you have the official figure. I'm open to correction here..

colinmis

https://www.boards.ie/discussion/comment/121037922#Comment_121037922

Thanks, i never thought of that. It's a very good point and something i hadn't considered at all.

As a landlord I'd advise selling its really not worth the hassle and its getting continuously worse.

A good agent is difficult to find.

Browney7

https://www.boards.ie/discussion/comment/121037922#Comment_121037922

I believe it is prorated and it doesn't have anything to do with when you moved out. So if you bought for 200k and moved out five years later when valued at 400k and sold 5 years after that at 400k, you'd get relief on half the gain (maybe even 6 years as I believe you get a year's grace). You also need to be careful with domicile and being "ordinarily resident" which is the period of three years after you cease to be a tax resident.

TLDR, get good tax advice

pooley124

I moved to the north about 15 years ago and rented my house in the south. First few years an agent managed it but I got sick of him charging me over the odds for maintenance jobs either done badly or not done at all. He also signed in tenants who had a dog and a budgie in the house which I didn't know about.

Got rid of him and managed it myself but it's difficult to do when you live a long way away. Tenants also took advantage of me being far away and sub-letted the sitting room as a bedroom.

Rent has been lagging behind the going rate the entire time( partly my fault) so I'm making nothing from the place.

Now that my interest rate has gone through the roof it's time to get rid of it so going to give them their notice soon. I'm sure that will be fun.

ec_pc

Sell for sure. It might make sense for the first few years, but then you get into having to spend money on updating the property and at that stage it becomes a hassle.

I am speaking from experience, I rented out my first home for 15 years, had the same tenants for the last 12 years who moved out. I was being crucified by RPZ and was so far off market rate it just was no longer viable for me to rent it to people. House needed some money put into it in terms of new kitchen etc, so I sold up. Worth it at todays prices to be honest.

StevenToast

Sell.

I havent read the OP or any other comments.

Just responded to the thread title.

pc7

Sell, I got out this year and the absolute relief of it being gone is unreal! You don't need the hassle, or stress of it (and my last tenant was great!). Get rid, as mentioned you'll have no CGT and can be mortgage free going forward.

colinmis

Thanks all, really appreciate the feedback. We've decided to sell and just enjoy having a much smaller mortgage on the next house