What's the catch?

GeorgeStobart2022 · 25-10-2022 7:20pm #1

55 Poplar Drive, Carraig An Aird, Six Cross Roads, Waterford is for sale on Daft.ie

These houses are all around 265k in the area however this one is only 175k. It does say there are tenants in situ which means you will be taking them on as their new landlord however if you want to use the property as your in own home you can serve them notice immediately and even f they've been there a while you would be looking at anymore tan 224 days notice period or could there be something else I am missing

Glaceon · 25-10-2022 7:22pm

Probably couldn’t get a mortgage on it, except a BTL one.

Grumpypants · 25-10-2022 7:42pm

It says current rent is 8700 a year. That's about €360 a month after tax.

If your mortgage is 1000, you are topping that up by 700-800 a month.

That's prob why it's that price.

endofrainbow · 26-10-2022 11:12am

A house near me was for sale and like this one, only had 4 pictures. It also had tenants in situ. My guess is that a deal has already been done hence the lack of info - but hey, what do I know?

DubCount · 26-10-2022 11:23am

My guess is the sitting tenant is a nightmare. Pictures may have been taken some time ago. It could take months/years to evict and who knows what damage may have been done in the meantime. This looks like a purchase for someone with a track record on difficult evictions - I'd stay away.

chunkylover4 · 26-10-2022 11:24am

It's a receiver sale. The tenant is likely the client of the receiver, a family member of just a difficult tenant entitled to a long termination notice period under Part 4 exceptions.

L1011 · 26-10-2022 11:25am

You'll have to buy with cash, you won't get the property back for a very considerable period - that notice period is idealistic and doesn't take in to account of the eviction ban about to come in - and you may not receive any of the (low) rent during that time.

fatbhoy · 26-10-2022 11:25am

It's beside Ballybeg? Worst estate in Waterford, as far as I know.

dennyk · 26-10-2022 7:05pm

It's being sold with a tenant in situ who's paying less than €730 a month (if they're actually paying the rent at all) for a four-bed in an RPZ. It's either a receivership where the bank can't be arsed to try to get the tenants out, or the owner knows they won't be able to remove the tenants in a reasonable time frame and just wants to be rid of the headache ASAP. Either way you're buying nothing but trouble. A tenant paying €730 a month isn't going to find anything else to rent in their budget, so regardless of the notice period you'll have to give them, they will almost certainly overhold indefinitely, and it may take you years and thousands in legal fees to have them removed, and god knows how much to fix all the damage they'll have done to the property in the meantime. Once there's animosity between you and the tenant due to the notice or their overholding, it's quite possible they'll stop paying rent entirely, as well, so you'll be getting nothing at all from the property in the meantime.

TenMoreMinutes · 26-10-2022 10:46pm

That's a serious discount, and still not worth it. You'd spend years paying off the property before you even gain the right to benefit from it, and you'll likely have to buy it sight unseen as the agent hasn't set foot inside, they've just been told what the seller wants them to know.

Anyone saying that landlords can sell with tenants in situ as an argument in favour of the eviction ban should be pointed directly at this as a case study of why the private landlord will be a thing of the past in a few years. It's just not worth the risk any more.

StevenToast · 26-10-2022 10:55pm

I wouldnt buy that house even if it was 10k......

Avoid like the plague

KilOit · 27-10-2022 12:01am

https://www.boards.ie/discussion/comment/119797986#Comment_119797986

10k to the house then 20k for the hired hitman to throw the tenant in the river and boom, got yourself a bargain

KurtBarlow · 28-10-2022 4:48pm

I made some enquires

1.Isn't it true that a lease can be broken if you buy a property with in situ tenants if you intend to use the property as your own residence?

This is generally correct but not when it is a lease with the council.

2.How long are the current tenants in the property and how much notice would I have to give them ?

The current tenants moved in in 2018 and have a 10 year lease until 2028.

3. Is there any risk from a legal aspect of not being able to remove the current tenants in the anticipated timeframe?

If you serve the tenants with notice to vacate and they don’t move out on the expected date (after 2028) you would have to bring this to the RTB in order to get an eviction notice.

4. Why isn't there many pictures of interior of the property compared to other houses in the area on Daft?

It is harder to get internals on occupied properties and the tenants do not want their belongings on display.

L1011 · 28-10-2022 6:11pm

So it has a low rent that isn't going to be adjustable for 6 more years, plus a not that high chance of getting them out easily at the time.

You won't get a loan for it and you cannot make any assumptions about living it it until 2029+

mrslancaster · 30-10-2022 1:54am

A friend of ours was looking at a property with tenants during covid. The EA said it was let to the council for 10 years with seven left so there was no possibility of moving in until the lease was finished and the tenants left. The rtb weren't involved in any way so a buyer couldn't terminate for their own use, and also, the council had to give approval for any prospective sale/buyer. Our friend walked away. The house did sell ok but probably to an investor, obviously not suitable for an owner-occupier.

Q&A · 30-10-2022 9:51am

Very much priced for an investor. Yields on a 4 bed are about 5.6% according to daft . On the face of it it might suggest it's still overvalued... But if it's one of those rent agreements where the council covers the rent and cost of upkeep it might make sense. But a very small and niche market of potential investors.

walterking · 30-10-2022 10:01am

Its not 175k. That's the reserve.

10 year council lease - near impossible to break.

Not an issue with pics - receivers are mindful of bad publicity and tenants rights to privacy.

Long term punt for an experienced investor.

Doesn't council lease have a different tax system?

Autumn Meadows · 08-03-2023 12:49pm

Which estate are u saying is the worst in Waterford is it Carraig an Aird or Ballybeg????

Thanks in advance.

Autumn Meadows · 08-03-2023 12:51pm

What avoid buying this house ??

jhegarty · 12-03-2023 1:06am

Th house already sold for €177,500. So you a little late.

bobbysands81 · 12-03-2023 3:26am

If this is a ten year lease to the Local Authority then it does not fall under the RTA and you CANNOT remove the tenant if you want to sell the property or if you want it for your or your family’s use… until the ten years is up.

The rent is also discounted by 20% for the full ten years.

At the end of the ten years the property is returned to the owner and should be handed back in good condition minus wear and tear.

The Winter Eviction Ban does not cover such properties as they are not let under the rules of the RTA

What's the catch?

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