Hi, I'm looking into buying a second property for investment and was told it was possible provided it didn't cost more than 300 - 317K max. Was thinking about appt/house in Tyrellstown or Swords. Has anyone any advice on where's the best places to buy for under 317K that will rent well? Cheers.
Rent well is a subjective term.
Unless the property is generating a yield of more than 10% there is a negative risk that it will perform poorly versus interest rates over the long term.
If the yield is less than 10% but greater than the combined cost of interest rates and costs (including costed risks of void periods) then there is a postive risk that you will be looking at breaking even on a cashflow basis over the short term.
If the yield is less than the cost of interest repayments and costs (including costed risks of void periods) then you are looking at negative cashflow or a cashflow loss over the short term.
The latter two scenarios rely on capital appreciation to make the investment viable. You'll have to make your own decisions on whether the property is likely to increase in value significantly over the course of the investment and whether interest rates will rise. Are there benefits to taking a short to medium term loss for the possibility of a long term profit?
Gross yields on EUR 317,000:
10% equals annual rent of EUR 31,700 or EUR 2641.66 per month
5% equals annual rent of EUR 15,850 or 1320.83 per month
3.8% equals annual rent of EUR 12,000 or EUR 1,000 per month
