I think you would get a much better response if you posted this in the correct forum - the investment property one. Here's a summary of the figures and my two cents (for what its worth, im no expert)
Purchase Price: €265,000
Current Value: €250,000
Mortgage Amt: €225,000
Implied Equity: €25,000
LTV: 90%
100% Occupancy Rental Yield: €950pm
92% Rental Yield: €871pm (avg. if one month idle per annum)
Rental Yield: 3.94% - 4.3% (min - max on purchase price)
Rental Yield: 4.18% - 4.56% (min - max on current value)
Interest Only Repayment: €1,106pm
25Yr Capital + Interest Repayment: €1,453pm (approx.)
Implied Interest Rate: 5.9% (approx.)
1) You have invested in a section 23, yet indicate that you obtain relatively little tax benefit from the property as it is your only buy-to-let. A S23 property typically sells for a small premium over comparable properties because of the tax advantages it confers on certain purchasers. Without doing the figures I can see that much of this relief is 'wasted' in your case as you have insufficent rental income to justify it. I am open to correction on this.
2) The value of the property has fallen, however, thankfully you are not in negative equity, so you are in a position to sell if you like without having to dip into your pockets for more cash.
3) Excluding capital appreciation potential; you are and will continue to loss some money on the rent/mortgage side of the investment. The rent is currently 150e per month less than the interest repayments. This is not that bad and if you are able to increase rent by another 50e for the next 3yrs, then you'd be at a breakeven point with regard to the rent/mortgage. It remains open to speculation whether you can actually manage to raise rent that much in the next few years. It also depends on 100% occupancy.
4) On the capital appreciation side, you've seen just a 6% fall in the properties value in the 3yrs. This compares to much higher falls accross the property market. Perhaps the S23 has helped maintain the value, or perhaps you bought at an already reduced rate. Without making a specific prediction, it is likely that the property will continue to fall in value in the short/medium term. The long term growth is anyones guess.
If you sell now for 250k you will have lost 15k on capital and 18k on funding mortgage (less rent). Upon selling you will have about 25k cash less fees.
If you hang in there you will continue to loss about 1800e per annum funding the mortgage repayments until rent rises. On the capital side; well thats the great unknown... most likely you'd continue to see a loss in the short/medium term and eventually turn a profit... but how long before this happens?!
As much as it was a poor investment, in my opinion you should hang in there if you believe the price is likely to recover accross your investment timeframe. Also you are fortunate to be nearly breakeven on the rent/mortgage. This is the key difference compared to many who have posted similar queries because when the rent exceeds interest then you will start making a profit (which you can keep, or use to pay down the mortgage) - this is assuming you are not concerned with capital fluctuations in the short/medium term.
These are just my beermat opinions.