Mortgage decision money makeover

Brendan Burgess said:
So you have to sell this anyway in 7.25 years.
It's a profitable investment
Rental income: €18,000
Mortgage interest: €10,000 (€216k @4.5%)
Other expenses : €3,000
Profit: €5,000
After tax: €2,500


Although it's profitable, it's risky from a number of points of view
1) The biggest risk is that you may not be allowed to sell it empty. You may have to sell it with the tenants which will greatly devalue it.
2) The tenants may stop paying rent
3) House prices might fall

You are not financially resilient enough to handle these risks, so sell the property as soon as you can and while you are allowed to do so.

Brendan
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Just to clarify pt 1 above..1) The biggest risk is that you may not be allowed to sell it empty. You may have to sell it with the tenants which will greatly devalue it. - Would this just be from our own financial perspective or would bank dictate same ? Sorry, just need to get clear in mnd what you mean, Thanks
 
Notsavy said:
Just to clarify pt 1 above..1) The biggest risk is that you may not be allowed to sell it empty. You may have to sell it with the tenants which will greatly devalue it. - Would this just be from our own financial perspective or would bank dictate same ? Sorry, just need to get clear in mnd what you mean, Thanks
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If you are not allowed to sell it empty but only with tenants, only LL would be possible buyers and currently only cash investors, which would greatly reduce the value of your property.
 
Just to be clear no bank will lend money to anyone with a tenant in situ. Very few Landlords will buy a property with a tenant in situ. Very few tenants will be buying the property that they are currently living in.
 
O dear, no idea what we are going to do. We have reviewed and putting down all our savings against our PPR is not an option for now unfortunately due to nature of our jobs etc Need to look at next best option.
 
Notsavy said:
O dear, no idea what we are going to do. We have reviewed and putting down all our savings against our PPR is not an option for now unfortunately due to nature of our jobs etc Need to look at next best option.
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Why not keep a 10-15k emergency fund, pay the rest of the savings off the PPR, then if you sell the investment property you should have another 40-50k on hand to either pay another lump sum off the PPR or, more likely, to use for kids education.
 
Thank you ,yes. Think we will hold onto tracker with the 12 years remaining and hopefully, we will be making the right decision. We need to make our decision in next couple of days and decide how much we are comfortable with paying off now on the PPR. 10/15k left only on deposit still seems a little scary to me to have to hand just in case car goes or if property prices do decline in next 2/3 years and selling not an option and we want to wait another couple of years for a little recovery before selling. If this happens then and it coincided with start of college etc. Who wouldn't love a crystal ball!!! It's a very big decision
 
Notsavy said:
Thank you ,yes. Think we will hold onto tracker with the 12 years remaining and hopefully, we will be making the right decision. We need to make our decision in next couple of days and decide how much we are comfortable with paying off now on the PPR. 10/15k left only on deposit still seems a little scary to me to have to hand just in case car goes or if property prices do decline in next 2/3 years and selling not an option and we want to wait another couple of years for a little recovery before selling.
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I think that your strategy in terms of rental is fairly risky considering the current rental market and the fact that you have to sell, all the more do that you seem to imply they could be job risks. How are you going to time the market? When are going to decide you are out? How much more do you expect to get from it?
Price are at an all time high.
 
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Coldwarrior said:
Why not keep a 10-15k emergency fund, pay the rest of the savings off the PPR, then if you sell the investment property you should have another 40-50k on hand to either pay another lump sum off the PPR or, more likely, to use for kids educa
azerty said:
I think that your strategy in terms of rental is fairly risky considering the current rental market and the fact that you have to sell, all the more do that you seem to imply they could be job risks. How are you going to time the market? When are going to decide you are out? How much more do you expect to get from it?
Price are at an all time high.t
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Coldwarrior said:
azerty said:
enants in so fixed term 12 mth contract
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azerty said:
I think that your strategy in terms of rental is fairly risky considering the current rental market and the fact that you have to sell, all the more do that you seem to imply they could be job risks. How are you going to time the market? When are going to decide you are out? How much more do you expect to get from it?
Price are at an all time high.
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Tenants have 12 month contract. Do we need to wait until month 12 to serve the 90 day notice or can you send notice on month 9,they are new tenants
 
You give the notice before the end of the 12 months if you want them to leave at 12 months. After 6 months, the notice is 152 days. And your eviction then can only be for a family member or a sell. Before 6 months 90 days. After 12 months, it's 180 days. But if you give them notice after 6 months because you sell there is a specific procedure to follow. Check rtb website.
 
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