Buy to let properties:
2 bed apartment, it was initially our family home for two years.
Value:240000
Rental income per year:16200
Rough annual expenses other than mortgage interest :3500
Lender. PTSB
Interest rate: tracker, ECB + 1.83, currently 5.93
Mortgage of 195000 remaining
You didn't address this point:I hope this answers any questions you had. I would appreciate it if you could let me know if these additional details changes the advice you have offered
As @Luternau suggests, if there's an outstanding rental income tax liability here then you'll need to factor that into your budgeting. Ditto for any CGT liability on the sale of the apartment.No mention of income tax as an expense (just 16200 rent and 3500 expenses, not including interest, which up to mid 2022, would have been very low. Is there exposure.
You didn't address this point:
As @Luternau suggests, if there's an outstanding rental income tax liability here then you'll need to factor that into your budgeting. Ditto for any CGT liability on the sale of the apartment.
Hi @Luternau, We are up to date with income tax returns and NPPR.@ClubMan
There won't be CGT if they bourg at 320k and it's value is (currently) stated at 240k.
@Muldoon
Some questions
Are you up to date on income tax / other things like NPPR charge applicable 2009/2013 for the rental.
How do you plan on dealing with the apt loan when you take out a second loan for new build?
For the next few years of high interest rates you are not going to make much or any profit on the rental. Your interest is almost €12k now up from about €4k up to mid lädt Year.
With stimated costs of €3500 and your capital repayments gives you no net profit after all cost. You also have a tax bill of a couple of hundred euro on top. (approx. €300). So it's currently costing you money, not generating income for you. An unknown variable is the value of the property could increase, or fall in coming years.
As it stands, with plans to build a new homw and all the costs associated, I would not be keeping the rental for the likely return over the next few years.
We plan to build a family home (approx. cost 620K) either at the end of this year or early next year and are informed by our broker that we can avail of a four year fixed rate of 3.65 % at the moment.
Yes, it could be be a few months still before we get the mortgage agreed and that interest rate might not be available thenYes, but you are not building now. This 3.65% could be higher or lower "at the end of this year or early next year."
Based on the advice received here I am considering selling the apartment, but if we don't sell it, then yes, then the question is "if you keep the apartment, should you pay off the mortgage now and borrow to finance the self-build?"So the question is if you keep the apartment, should you pay off the mortgage now and borrow to finance the self-build?
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