Should I sell our home or rent it?

NotMyName

New Member
Messages
1
Hello, I'm new here and looking for some advice please. We purchased a house two years ago in a rural area for €140k. We are moving in with our elderly in-laws to help them out at home, and are trying to decide what to do with our home. Our in-laws home will become ours in the future. Do we sell our home or rent it out? I think we could probably rent for 700-800 per month. Or could we get a good return if we put some work into the house and sell this year?

Some background:
- 3 bed, 2 bath detached house with large gardens - and one of the most amazing views of the countryside I've ever seen (the reason we bought the house!)
- We have done some work on the house. Landscaped the front garden, insulation, new radiators throughout, new boiler, new hot water tank, repainted half the rooms.
- Probably needs repainting in the rest of the rooms, potentially painting the outside, back garden tidied up, etc. What work would you consider to be essential to sell a house for more than you bought it?
- 2 outbuildings, not watertight and need work (re-roofing, concrete flooring, new doors).
- We have a mortgage with the bank of €45k and an almost interest free family loan of €50k and were gifted the remaining €50k. We pay a total of €700 in repayments per month.

What would our best option be financially? Is renting a good option? Or should we do some more work on the house and try to sell it for a good price? Let me know if I haven't provided enough information - it's all new to me. Thank you!
 

NoRegretsCoyote

Frequent Poster
Messages
911
There are many considerations but here's one.

Buying and then trying to sell very soon may give rise to 'lemon' fears among potential purchasers. They might feel that you've discovered something unpleasant which is causing you to sell.

This is why a new car drops appreciably in price once you drive it off the forecourt.
 

Leper

Frequent Poster
Messages
921
From where I sit this is a no-brainer:-
1. Rent
2. You will always have an income or the potential of income from the "old" house.
3. You have no guarantee that you will inherit the "new" house.
4. Extra Income = More Independence (you're getting it free; others have to pay dearly).
5. Sit comfortably and appreciate your good fortune.
 

Feemar5

Frequent Poster
Messages
318
Becoming an accidental landlord is not always suitable - here are a few things to consider

1. You will pay tax and U.S.C on your rental profit -more than likely at 40% if you are working as well.
2. It will no longer be your principal private residence and if you sell in a few years you will be liable for C.G.T
3. Laws regarding renting are changing rapidly and it is not easy to end rental agreements - there is talk now of landlords being able to sell but with tenants installed.
4. Will you be living near the property - if not you will need someone who can fix things if there are problems.
5. On the plus side you will have a property if things do not work out.
6. Regarding doing repairs to outhouses before selling - I would just tidy up as whoever buys the house might decide to do something completely different with them.

Good luck.
 

Brendan Burgess

Founder
Messages
38,671
A very interesting and complex question. While I would tend towards holding on to it, it is not a no-brainer.

Non financial issues
Moving in with the in laws might not work out. You might be delighted to have your home to return to if it doesn't.
While your in-laws home should become yours, lots of things can happen. You move it to look after them and fall out. Again, you will want your home.
This sounds like a unique home and so it would be difficult to get another one like it.

The hassle of being a landlord is just not worth it for most people. The government is actively chasing landlords out of the market.

Financial issues
By owning a house, you keep a stake in the housing market. If you sell the house and prices increase, you might never be able to buy a similar house again, if you need to.

It should be very profitable if you can rent it to a good tenant. Don't worry about tax. You only pay tax if you are making profits.

CGT issues. As it is your Principal Private Residence you are exempt from CGT if you sell now or within a year of letting it out. After that, the exemption becomes diluted. This is worth noting and should not be the reason for selling.

Conclusion
If the house is where you would live if you were not going to inherit a house, then I think you should keep it for at least a year. See how things work out and review the decision in a year.
 

cremeegg

Frequent Poster
Messages
3,081
Three brief comments

1. If you hold and rent you will very probably make money, but there will be work and hassle involved.
2. If you decide to sell dont spend (much) money doing it up. Internal painting, yes, beyond that usually you won't get your money back.
3. I you disagree with post no.2 above. Thats just my experience.
 
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