I'm currently considering my options in relation to an apartment I own.
Any input/advice/comments most welcome.
Purchase price of property in 2008: €450,000
Current Value: €400,000
Outstanding Mortgage: €364,000 with 15 years remaining
Current Mortgage Rate: 0.75%, First Active, now UB tracker
Current Mortgage Repayments: €2,021/month of which interest €237 (paying capital back over 20 years- first 5 were interest-free, but it is classified as a residential and I have a first active letter stating this)
Current Rent income: €1,820 (can increase it later in the year- this is below market rate which is more like 2k in the development)
A few other factors:
- I lived in it for the first 5 years and it is currently let. The apartment is no longer suitable as we've outgrown it as a family.
- We're both 36. We have separate life cover and mortgage protection in place.
-We recently moved back from overseas, have two toddlers and currently one income (35k after tax). We hope to have a second part time income later in the year.
- After tax, management fees etc, we're funding a shortfall of 500e per month on the apartment and we're paying 1,500 in rent ourselves. So, we're basically living off savings
- There are potential building defects in the development with a court case likely to become public later in the year/next year. The issues are currently being disclosed on requisitions on title.
- If we can hang on to it, I would see it as our pension. This would leave us with a mortgage-free property in a good location (assuming all the building defects issues are sorted) in 15 years time. I'm also aware this is the cheapest money we'll ever borrow so afraid I'd regret selling. But, then, when interest rates go up and our own (low) rent gets reviewed we'll struggle.
Options:
a) keep the property and keep renting it out. try to get another mortgage for a dwelling in a few years once our incomes are sufficient and kids older so less childcare costs.
b) sell and put (all of) the 30k or so (after costs) equity into a deposit account and ringfence it for a deposit for a family home in a few years; this would leave us with 500euro extra cash per month
c) sell and avail of the UB tracker mover. On this- does anyone know whether UB would treat this as a whole new mortgage application? If so, we obviously wouldn't qualify on our incomes so this might not be an option at all.
Would really appreciate some input here as I can see the argument each way and I'd like to make a decision soon.
Thanks in advance for your input.
Any input/advice/comments most welcome.
Purchase price of property in 2008: €450,000
Current Value: €400,000
Outstanding Mortgage: €364,000 with 15 years remaining
Current Mortgage Rate: 0.75%, First Active, now UB tracker
Current Mortgage Repayments: €2,021/month of which interest €237 (paying capital back over 20 years- first 5 were interest-free, but it is classified as a residential and I have a first active letter stating this)
Current Rent income: €1,820 (can increase it later in the year- this is below market rate which is more like 2k in the development)
A few other factors:
- I lived in it for the first 5 years and it is currently let. The apartment is no longer suitable as we've outgrown it as a family.
- We're both 36. We have separate life cover and mortgage protection in place.
-We recently moved back from overseas, have two toddlers and currently one income (35k after tax). We hope to have a second part time income later in the year.
- After tax, management fees etc, we're funding a shortfall of 500e per month on the apartment and we're paying 1,500 in rent ourselves. So, we're basically living off savings
- There are potential building defects in the development with a court case likely to become public later in the year/next year. The issues are currently being disclosed on requisitions on title.
- If we can hang on to it, I would see it as our pension. This would leave us with a mortgage-free property in a good location (assuming all the building defects issues are sorted) in 15 years time. I'm also aware this is the cheapest money we'll ever borrow so afraid I'd regret selling. But, then, when interest rates go up and our own (low) rent gets reviewed we'll struggle.
Options:
a) keep the property and keep renting it out. try to get another mortgage for a dwelling in a few years once our incomes are sufficient and kids older so less childcare costs.
b) sell and put (all of) the 30k or so (after costs) equity into a deposit account and ringfence it for a deposit for a family home in a few years; this would leave us with 500euro extra cash per month
c) sell and avail of the UB tracker mover. On this- does anyone know whether UB would treat this as a whole new mortgage application? If so, we obviously wouldn't qualify on our incomes so this might not be an option at all.
Would really appreciate some input here as I can see the argument each way and I'd like to make a decision soon.
Thanks in advance for your input.
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