Hi
Hoping for some assistance or advice on a decision on whether to sell or continue renting an investment property. Like many people never planned on being a landlord but ended up as one through the property bust. I'll try outline as many of applicable facts as possible. I'm ignoring what I paid for property back in 2007 as part of decision, purely based on what its worth now, what I owe and the rental income.
House-3 bed end of terrace in Dublin commuter belt, currently valued in 230k-250k region.
Mortgage- 228k (tracker with AIB, 28 years left, monthly payment approx 840)
Rent- 1,000 p/m (if i decide to keep I can likely increase to 1,150 easily, held off any increase in last year until I decide as long standing good tenants)
Net Loss annually is roughly 3k (main expense is tax as very little interest to currently deduct from income and other expenses/capital deduction not huge.) If i increased rent to 1,150 this would come down to about 2k.
I'm in lucky position I can afford to cover annual loss and can continue to do so all things staying the same. If i was to sell and take mid value I will clear mortgage, cover expenses (legal, estate agent, basic renovations pre sale etc) and come out even or a couple of grand up. And if lucky to get high end all the better, could pay lump off home mortgage which is more recent and currently 4%. I had always thought once i got to that situation I would sell as its a bit of hassle having it. Also considering interest rates will eventually go up, might not always have good tenants, house getting to stage where will need some investment to modernise, appliances breaking etc. etc.
But part of me is now saying I should keep as investment. I have a good pension pot for my age but maybe no harm to have this as longer term investment. Even at annual loss of few grand, equity is increasing annually at faster rate as mortatge paid down and if factor in even gradual increases in price it seems to make more and more sense. So looking at annual loss more as annual investment I guess. I'm mid 30's can afford to take on some risk.
That was much longer post than planned, appreciate any advice offered, been going over and back on decision for few weeks now, conscious of compounding original error of buying at top of market.
Thanks
Hoping for some assistance or advice on a decision on whether to sell or continue renting an investment property. Like many people never planned on being a landlord but ended up as one through the property bust. I'll try outline as many of applicable facts as possible. I'm ignoring what I paid for property back in 2007 as part of decision, purely based on what its worth now, what I owe and the rental income.
House-3 bed end of terrace in Dublin commuter belt, currently valued in 230k-250k region.
Mortgage- 228k (tracker with AIB, 28 years left, monthly payment approx 840)
Rent- 1,000 p/m (if i decide to keep I can likely increase to 1,150 easily, held off any increase in last year until I decide as long standing good tenants)
Net Loss annually is roughly 3k (main expense is tax as very little interest to currently deduct from income and other expenses/capital deduction not huge.) If i increased rent to 1,150 this would come down to about 2k.
I'm in lucky position I can afford to cover annual loss and can continue to do so all things staying the same. If i was to sell and take mid value I will clear mortgage, cover expenses (legal, estate agent, basic renovations pre sale etc) and come out even or a couple of grand up. And if lucky to get high end all the better, could pay lump off home mortgage which is more recent and currently 4%. I had always thought once i got to that situation I would sell as its a bit of hassle having it. Also considering interest rates will eventually go up, might not always have good tenants, house getting to stage where will need some investment to modernise, appliances breaking etc. etc.
But part of me is now saying I should keep as investment. I have a good pension pot for my age but maybe no harm to have this as longer term investment. Even at annual loss of few grand, equity is increasing annually at faster rate as mortatge paid down and if factor in even gradual increases in price it seems to make more and more sense. So looking at annual loss more as annual investment I guess. I'm mid 30's can afford to take on some risk.
That was much longer post than planned, appreciate any advice offered, been going over and back on decision for few weeks now, conscious of compounding original error of buying at top of market.
Thanks