To Rent Or Not To Rent

Hi
I find myself in a bit of a dilemma and would be grateful for some feedback.
I purchased an apartment on the southside of Dublin (275k + 25k parking space) in December 2007 as a first time buyer with the intention of having it as my PPR. Since then my job has transferred to the northside of Dublin and I have become engaged and moved in with my fiancée , who also lives on the northside.
My own apartment is therefore sitting vacant at the moment. It is unlikely I would find a buyer for it at what I would consider a reasonable price in the current climate so I am looking at renting it out.
I am aware that I would be liable to stamp duty clawback seeing as it is just over a year since I bought the property.
My question is would it be financially more prudent for me to just let the property sit vacant for a year and pay the mortgage (would be approx 12k for the year) or declare myself a landlord, rent the property out and face the ensuing stamp duty bill.
Either way it looks like a painful hit, unless I’m missing something!
Any thoughts greatly appreciated...

There is a midddle ground that is still legal.
Treat the southside place as your PPR and rent out a room in it. If it is a 2 bed apartment you may find that this is a possible option. You can get 400 euro (someone can correct this figure?) a month tax free this way. If you do the math vis a vis repaying the stamp duty and paying tax on the full rent (which may be no more than twice the room rent), you may find that it adds up -- at least until you see how things shake out over the next year or so.
Before someone jumps on this as being illegal, technically you are just visiting your GFs apartment, you have no financial stake in it.

I believe the rent a room is the way forward also. BTW up to 10k you can earn annually without tax implications.

gilboy said:

I believe the rent a room is the way forward also.

Click to expand...

only if OP lives in his apartment.

Thanks for the advice.

Unfortunately it's a one bed apartment so there's no way I could claim I'm living there while also renting a room.

I think I may have to take the hit on paying the mortgage for the rest of the year while it lies vacant. If I rented the whole apartment out I'd have to pay the stamp duty, which I reckon would be around 12k, while also probably having to make up the discrepancy between the rental income net of tax and the mortgage. I figure this would work out more expensive than paying the mortgage.

Just as a matter of interest, what do you think is a "reasonable" price for the apt.? If this is determined by the mortgage you still have, then fair enough.

If you can cover the outstanding balance of the mortgage by selling it, this would seem to be the least painful option.

Of course, this depends on how much of a deposit you had when you bought it.

So, if negative equity is not an issue, I would seriously consider avoiding the ongoing cashflow problems/hassle with tenants/potential issues with Revenue by selling the property and setting up house with the girlfriend with no worries ...