I’m a landlord should I sell up and try make something out of a bad situation

So long story short i bought an apartment in 2006. Market fell so then was in negative equity for many years. I moved out and rented it out. Alot of difficult times managing tenants, but luckily got one good one the last six years. They have now told me they are moving out end of august. I was thinking id keep the property but given stress involved with renting it out im thinking it would be better to sell perhaps.
It is my only property. I don’t want to live in it.
Bought for 300k
Similar going for 270k ish
Mortgage redemption 187k
Mortgage interest rate 5.5
Age 51
Mortgage til 67
I was going to hold onto it as a pension but if i sell now would it make sense to invest the money and not have to deal with the stress of being a landlord. Any advice appreciated thanks.

If you sell, after clearing the mortgage you’ll have about €80k to invest. Plus, you’ll have ongoing savings in no longer having to pay interest — about €10k/year. As against that, you won’t have any rental income. You don’t say what the apartment would let for.

Plus, you won’t face the prospect of “difficult times managing tenants” and you’ll be spared “the stress of being a landlord”.

Given that you don’t want to be a landlord and don’t enjoy it, my feeling is that you would be right to sell this property unless there is some compelling argument for keeping it. The only compelling argument would be a prospect of a very high return that would not only exceed what you have to pay in interest and in property-related expenses, but would exceed it by an amount that you would consider sufficiently large to compensate you for the grief of landlording (even after you’ve paid tax on it).

Any return would come from:

- the rental income, and you don’t say what that might be; and

- capital appreciation, which is necessarily speculative.

I don’t think we can say much more than that without at least knowing what this apartment will rent for.

thanks for your reply. I rent it currently for 1411 and the mortgage is 1486. I believe i can raise the rent a bit when the current tenants leave. I dont think the return will be far greater as the tax relief i get goes down as the mortgage interest relief goes down but im not great at understanding the overall financials beyond the basics. Thanks

Leave it empty till March 2026 and reset the rent? What is the going rent in that area?

Based on what you have written, selling up is the best option here.

Its not the worst of times to sell..

So the investment hasn't worked out brilliantly, on clearing €80k you will have realized approx €50k over the 19 years of some stress. This in its self is quite a nice sum, but you don't say at age 51, if you have another property your living in, or renting, and plan to continue renting, if renting, then its not a great position you are in tbh, If a home owner, then its pretty good position all things considered.

You could also pay 7% to a letting agent to look after your rental. That won't make all the hassle go away but most of it.

Need to decide what is the purpose to you of having that property. Do you want the option to move back there eventually? Do you see it purely as an investment/pension? As mentioned by @LS400 do you have your own home by now and if so can you comfortably afford the mortgage on that? Are you happy with where you live now etc..

If you have no particular sentimental attachment to the rental property and see it only as an investment/pension then better to try and figure out what it is financially worth to you as an investment and compare that with what return on investment you could get by putting the money to work elsewhere. Maybe you do tax returns every year and have records you could look over and figure out things like Gross Yield and Net Yield. It's a pain but that's what is needed and try to keep emotion out of it. If needed pay an accountant to do that for you. It would bring clarity and peace of mind to your decision.

Almost certainly you will be far better off financially by investing the value of that property, as well as the future cost to you of maintaining it, in something else such as individually held shares, kept for the rest of your life, which you could draw an income from, incur far less costs and risk by owning them, and pay capital gains tax at a rate of 33% on any gains they produce rather than all the taxes landlords pay on rental income, approx 52%.

Maybe i could get 1700 pm in march. i had a letting agent once but never again. I dont own another property and live at home with family but just dont think i can face the market the way it’s going. Too pro tenant. I might ask an accountant of financial person to do up figures for me. My instinct is to quit while im ahead even though im not really. Just for peace of mind. There was a long time there when i thought id never get out of negative equity.

suesue said:

I dont own another property and live at home with family

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By family, do you mean your parents?

Is this a permanent housing arrangement for you?

Do you expect to inherit this house after they die?

Or will you be in a situation where the house is sold and the proceeds split between you and your siblings?

I think it's important to have a stake in the housing market. It means that you will always have somewhere to live. Even if you do not ever wish to return to this house, you can always sell it and buy another house.

But if you will never need this house, then sell it.

suesue said:

Mortgage interest rate 5.5

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Why are you paying such a high rate?

Who is the lender?

If it's an investment property, you won't be able to switch for a cheaper rate.
But if it's your home, you should be able to get a cheaper rate from your current lender, as long as it's not a vulture fund.

Yes living at home and it would be left to me and my brother. It’s pepper assets sold by KBC so vulture fund i guess. I know it’s important to have a stake in the housing market but just find the whole landlord thing stressful. It was bought as a home but then I rented it out so it’s listed as an investment property now. Had very bad experience with one tenant in particular where I ended up being owed 6k and had to go to court to get her out. Spoke to a friend there she thinks I should move back in and rent out a room. At least id have some control over it still. I am presuming pepper will not decrease the mortgage rate even if it is my PPR. Just trying to consider all my options i guess.
Thanks all for your advice.

I'd seriously consider your friend's advice - esp if the property is nearby. Assuming its a 2 bed, move back in (change bills etc. to your name) so it's your legit PPR. Now that you're renting a room in your PPR, your rent income can be legitimately tax free (up to the 14k limit: https://www.citizensinformation.ie/en/housing/owning-a-home/home-owners/renting-a-room-in-your-home/ ), no need to register with RTB, tenant will be a "licensee", you've more control, you stay on the property ladder and you may even be able to shop around for a better mortgage deal/refinance...

(and if the rent now is 1400 - and assuming you pay tax etc. on that at about 50%, then currently you clear about 700. You say it may be worth 1700, so perhaps you'll find someone happy to share for half that or more (say 850 - esp if you spend a lot of time at your mother's) - and given that that income is now tax free, you may even come out ahead.. By living in it you're also increasing the proportion of time it will have been a PPR vs rented - which can have a favourable effect on any Capital Gains you may owe (though by the sounds of it, you wouldn't owe any at this point...)

The only thing to consider is if you were to inherit a home you've not been living in, you may not be able to avail of certain CAT exemptions should the value of that inheritance be high - there's probably advice elsewhere on this site about that - or see citizens info:
"Dwelling house exemption
If you get a gift or inheritance of a house that has been your main residence, it may be exempt from tax if you do not own or have an interest in any other house. There are conditions on how long you must be resident in the house before and after receiving the benefit."

Revenue: https://www.revenue.ie/en/gains-gifts-and-inheritance/cat-exemptions/dwelling-house/index.aspx

Good luck w your decision!

Moving back in and renting out a room seems to be the best idea. You have tax free income and control. The rental market will get much more pro-tenant post March 2026 and if you aren't comfortable with it now, it'll be much more stressful for you after March.

The capital acquisitions tax issue is a very good point, but perhaps any inheritance will be covered by the €400k tax free threshold which you have when you inherit from your parents.