Sell rental or keep as investment?

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Dublin005

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Hi, my wife and I have a 3 bed home in Co. Dublin which we purchased (€355k) back in 2006, moved abroad in 2008 till 2015. So it has been rented out since 2008. Some good and some bad tenants. Mortgage is €1350 pm, (tracker so it will increase again) rental income is €1750 pm at the moment. Average tax bill is 4-5k per year. 14 years left, approximately €160k remaining on mortgage. Tenant is moving out in a couple of weeks. My gross is €49k, wife is self employed currently on unpaid paternity leave. 3 kids under 10. We have a small mortgage on our family home 90k, no other loans. All savings have been spent on refurbishments on our family home. Question is Should I sell this rental property which would do away with the hassle and yearly tax bill and would pay off my family mortgage with approx €70k left in the bank or should we stick it out for the remaining 14 years?
Thanks for reading
 
Yes that €320k is just an estimate, I haven’t had it valued yet, I was just going by what has sold in the area recently. The estate was built in 2006, a number of homes had pyrite, our house had but has been remediated 4 years ago and has the green cert. I could be lucky and get maybe €340k
 
Dublin005 said:
Average tax bill is 4-5k per year.
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That would imply an after-tax profit of around €4kpa, which I suspect was marginally higher than the interest you were paying on your PPR mortgage.

However, with interest rate hikes over the last 12 months, I suspect your profit on the rental is going to shrink quite materially, whereas the mortgage rate on your PPR has (or will shortly) rise materially.

You will have to crunch the numbers but I suspect you would be better off selling the rental.

If it’s anyway close, you should sell. There’s no point taking on risk and hassle for a slim reward.
 
Sarenco said:
That would imply an after-tax profit of around €4kpa, which I suspect was marginally higher than the interest you were paying on your PPR mortgage.

However, with interest rate hikes over the last 12 months, I suspect your profit on the rental is going to shrink quite materially, whereas the mortgage rate on your PPR has (or will shortly) rise materially.

You will have to crunch the numbers but I suspect you would be better off selling the rental.

If it’s anyway close, you should sell. There’s no point taking on risk and hassle for a slim reward.
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Thanks very much for the advice, much appreciated
 
If it were me, I might consider selling. With 14 years left and all the headaches you've had, that €70k in the bank could really ease things, especially considering your wife's unpaid paternity leave. It'd be a whole load off.

I had a similar dilemma with my house in Northhampton, UK. Bought it for £200k, and the mortgage was £950 pm. I had some good times with it, but I decided to sell when I realized it was more hassle than it was worth.

I took the money and, through a Greek real estate agency, bought a place in Greece, for £180k.
With the high flow of tourists, I thought it'd be a good idea to rent it out via Airbnb. So I did that, and now I have a stable cash flow, the house is always booked.
 
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Boober89 said:
If it were me, I might consider selling. With 14 years left and all the headaches you've had, that €70k in the bank could really ease things, especially considering your wife's unpaid paternity leave. It'd be a whole load off.

Now, speaking of selling and reinvesting, I had a similar dilemma with my house in Northhampton, UK. Bought it for £200k, and the mortgage was £950 pm. I had some good times with it, but I decided to sell when I realized it was more hassle than it was worth. I bought a place in Glyfada, Greece, for £180k. With the high flow of tourists, I thought it'd be a good idea to rent it out via Airbnb. Turned out to be a great move! It's always booked, and the Airbnb rent (£4000 pm) covers the £750 pm mortgage and brings in some great profit.

I now live in a rented apartment in London, but that experience in Glyfada has me thinking about another property here for rent in 3 years. It's about weighing out the risks and the rewards; in my case, the switch was well worth it.
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Thanks very much for your input. We have gone sale agreed at a price of €325. Cherrs
 
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