Apartment - Should I sell?

H

hokey32

Registered User
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Afternoon folks. I'd appreciate some opinions on the following:

Myself and my husband bought a two bed apartment in the Northwood, Santry area in 2004 for €288k. 8 years and two kids later (ages 1 1/2 and 3 1/2) we're still here. Although it's a large apartment as you can imagine with two small children space and storage are a problem.

Our mortgage is actually relatively low, €143k, so a few months ago we put it on the market at €150k. We had a few viewings and and offer of €130k which was withdrawn when the sale of that persons house fell through. Just before Christmas the auctioneer advised us to drop the price to €135k to draw in viewers. We've had a few viewers since Christmas and one offer of €125k.

We have savings of €40k in the bank but if we sell at €125k we'd have to use €18k of it to clear the mortgage and by the time fees are paid we'd have very little savings left. So at the end of the day we'd have no home and very little savings.

Should we stay and at least have our own home and savings in the bank or sell and get out while we can but have to rent for the foreseeable future as we no longer have the ability to save (I'm job sharing since the arrival of our second child so with creche fees we've really only one wage).

Any input appreciated.

H
 
Would it be an option to rent out the apartment and rent somewhere larger for yourselves? Why not do the numbers on what rent you would expect to receive, what rent you would expect to pay for a larger place, and what the monthly mortgage repayments are and see how this looks on your current income (adding in the expenses that go along with renting out your apartment).
 
You are in the lucky position that you can actually sell and can afford to pay the mortgage shortfall. I think you should go for it.

You will not be in a position to trade up to a 3 bed house for some years to come, so you are better off renting a suitable house than owning an unsuitable house.

The one issue which could change this is if you have a really low tracker mortgage. €143k at 2% would be only €3,000 a year. Presumably renting would cost you at least €8,000 a year.

As Ceist says, it is worth doing the numbers to see if you should rent out the apartment. €125k @2% = €2,500 which is the real cost of keeping it.
If you get €6,000 rent, it may be worth keeping, depending on your view of how the price for the apartment may move.

But first decision is to rent a suitable house.
Second decision is whether to sell or keep the apartment.
 
Thanks for the replies. We don't have a tracker mortgage and unfortunately are with PTSB. BOI have agreed to let us switch our mortgage to them which would mean our interest rate would be approx. 1.6% lower than what we're paying at the moment.

Renting out the apartment would be an option although I'd be a reluctant landlord. Don't think I'm cut out for it! Also our mortgage repayments in the apartment are a lot lower than the rent on a 3 bed house.

I suppose I'm just worried that if we don't sell now we'll never sell it.
 
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