Grasshopper
Registered User
- Messages
- 14
Are you absolutely certain it's fixed for the full term, and not a fixed margin over ECB?Current Interest Rate is 2.15% fixed until end of mortgage term (strange contracts back then)
Apologies it is 2.15% + ECBAre you absolutely certain it's fixed for the full term, and not a fixed margin over ECB?
If that's fixed for the next 30 years it's a valuable thing.
Income 22,500
Interest (5,050)
Other expenses (3,000)
Taxable income 14,450
Tax at 52% (7,500)
Assumes higher rate of USC.
I never thought I would be, nor wanted to be a LL, but I guess it makes a lot of sense, provided I get decent tenants. Would you suggest availing of a good management company or DIY? I will be local enough.If you rent it you will make a profit of just over 10% after tax.
It is cashflow positive to the tune of €4,100 per annum.
And you are confused !
Get a reputable management company that is local to the property (I'm guessing it's not Dublin). Their cost is tax deductible as well. All you have to do is fill in the form 11 every year or indeed hire an accountant to do so.Would you suggest availing of a good management company or DIY? I will be local enough.
If you rent it you will make a profit of just over 10% after tax.
It is cashflow positive to the tune of €4,100 per annum.
And you are confused !
But be aware this isn't the get out of jail free card that many people assume it will be. Plenty of examples of people who used management agencies and ended up with nightmare tenants, with little recourse from the agency.Get a reputable management company that is local to the property (I'm guessing it's not Dublin). Their cost is tax deductible as well. All you have to do is fill in the form 11 every year or indeed hire an accountant to do so.
As long as the mortgage is being paid they tend not to bother with any of this. On the other hand if you were to declare it to the bank they may decide to change it alright, if you catch my driftWould the bank not want the mortgage switched a BTL at a higher rate?
If you rent it you will make a profit of just over 10% after tax.
It is cashflow positive to the tune of €4,100 per annum.
And you are confused !
Rental Income | 22,500 |
Mortgage | - 10,524 |
Tax | - 7,514 |
Expenses | - 3,000 |
Net | 1,462.00 |
Are you absolutely certain it's fixed for the full term, and not a fixed margin over ECB?
If that's fixed for the next 30 years it's a valuable thing.
Income 22,500
Interest (5,050)
Other expenses (3,000)
Taxable income 14,450
Tax at 52% (7,500)
Assumes higher rate of USC.
3,000...What did you use as expenses?
We were given the interest rate and the outstanding principal amount.How did you calculate the Interest?
We were given the interest rate and the outstanding principal amount.
In very round numbers, the OP could earn around €7k pa, after tax, by keeping the property as a rental. Alternatively, he could cash out the equity and apply it against the mortgage on his new PPR, saving around €2k pa.
So, I guess the question is whether €5k pa is sufficient reward for all the risk and hassle that goes with being a LL?
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