Should we sell investment properties?

Hi all.

Need some advice here.
I recently got married with the intention of moving nearer to my wife's home.
We are currently trying to get finance to purchase a place.I sold my PPR which was in fairly good positive equity which leaves us with 140k in combined savings.We were hoping to borrow circa. 100k extra to get a place.Our problem is we both have other properties.

Mine-3 bed semi jointly owned with a sibling 50/50
Value-130k Mortgage-139k Repayments-846 per month Rental yield-700 per month

Hers-3bed townhouse
Value-250k Mortgage-199k Repayments-980 per month Rental yield-1100 per month

Salaries
Hers-53k gross (public sector)
Mine-20k gross(self employed)

All of the banks we have dealt with tell us that existing borrowings are too high to even consider making an application,even taking into consideration large deposit and rental yields etc.We currently live in my wife's house which is fine for now but not suitable long term.
We are both reluctant to sell these properties as we have put so much into them, but do we have much of an option?
Any advice appreciated

Thanks in advance

What interest rates are you paying on your respective mortgages? Does your sibling have a view?

What you have "put into" the properties in the past is, frankly, irrelevant. All the matters is your position today and what you want to achieve in the future.

hi sarenco

interest rate on joint property is 5.15% (23 yrs 9 mths remaining) interest rate on my wife's property 4.25% (30 yrs remaining)

Hi secondrowdol

Taking the two properties in order:-

The jointly owned property is yielding less than 6.5% (€700 x 12/€130k x 100) on a gross basis - that equates to a net yield of around 4.5% (6.5 x 70%) and you're paying a rate of 5.15% to finance the purchase of this property. Before you even start to think about taxes, it should be obvious that this is not a winning proposition. Would you borrow money from a bank at a rate of 5.15% to put it on deposit at a rate of 4.5%?

Your wife's property would yield around 5.3% (€1,100 x 12/€250k x 100) gross, around 3.7% net (5.3 x 70%) and is being financed at a rate of 4.25%. Again, that makes no sense to me as an investment - why pay an interest rate of 4.25% to purchase an asset that yields 3.7%? Again, that's before you even take account of the fact that currently 25% of the interest payments are non-deductible for tax purposes.

I'm ignoring the equity position in relation both properties for simplicity.

So, that's the maths. In the real world you obviously have important relationships to consider.

You're actually not in a bad position at all but don't get hung up on the past - it really is irrelevant to the decisions you have to make today.

Thanks for that sarenco.makes the picture a bit clearer for me.

Sorry does your wife have a second house? You state that she has an investment property and you're receiving rent of 1,100 for it, but presumably that's not the house you are living in? So what are the financial details of the other house? Or am I mis-reading things?

I assumed the rent on the wife's house was a projection.

My wife's 'investment property' is the one we live in.it was rented previously and yielded between 1000 and 1200 per month,hence the 1100 projection.