Without knowing the property value / rent, it's difficult to be so definitive.It makes no sense at all to keep that property
I see your point in the short term...butHi Marantz
Say you have a mortgage free investment property worth €150k.
This may go up or down in value over the longer term. That is a real risk to you. A short-term drop would not matter.
You are probably getting €9k rent. After costs and that, you might be getting €7k net rent.
You are running the risk of a bad tenant or difficulties in finding a tenant. That seems very unlikely in today's market, but markets change.
So you are getting €3,500 net after tax from this property.
You are paying about €7,500 net interest on the mortgage. You can probably reduce that to €6,000.
But this is an unprofitable business with a lot of risk.
It makes no sense at all to keep that property.
Brendan
Say you have a mortgage free investment property worth €150k.
It makes no sense at all to keep that property.
Without knowing the property value / rent, it's difficult to be so definitive.
"The passive income figure & total equity suggests a property portfolio worth north of 1.3m, with total borrowings of 350k. "
That's more or less in the ballpark as of now, although the equity is nice, it's mainly the income stream that's important to me.
Fair enough, my bad. I wasn't thinking in the context of your example. In the example the conclusion is valid. But it's unlikely to be near reality given OP recently took an equity release and lenders are restrictive on LTV in such scenarios, although this is likely to be loss making up to 50% LTV.I was giving an example. And if that example is anywhere close, the conclusion is valid
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