@PaxmanK
I can see why you are struggling with this decision - it looks fairly finely balanced.
A few quick questions:-
1. What what was the acquisition cost of the apartment and was it ever your PPR?
2. What is the outstanding mortgage balance on the apartment?
3. Are you currently receiving mortgage interest relief on the PPR mortgage?
4. Does the apartment OMC have a decent sinking fund?
You have an apartment worth €170k with a €75k mortgage at ECB +0.5%
So effectively, your investment is €95k
You are making a rental profit before tax of around €9,000 (€950k x 12 - 20% - €75k @.05%)
After tax, that is a net return of around 4.5% to 5%.
You can sell your investment, but what will you do with the proceeds? Pay off your mortgage at 0.75%?
You will pay around €6k CGT to sell it.
On a purely financial basis, this is a good investment and worth keeping. There is a risk of property prices falling but this is counterbalanced by the opportunity of a price rise. Sure you can get bad tenants, but if your current good tenants leave, you will be able to refurbish it and get higher rent.
But I fully understand the disillusionment with the rental model. You are making around €4,500 a year net profit on it. If the disillusionment is more hassle than €400 a month, then sell it. If not, hold onto it.
Brendan
We will remove the current tenants before we get stuck with them for another 6 years (They are actually good tenants).
If you keep it, this is the bit that doesn't make sense to me. Why get rid of good tenants? If it's already hassle do you really want to get changing tenants every 6 months, and the risks that come with that? Voids, bad tenants, etc. Or can you get a higher rent this way?We will remove the current tenants before we get stuck with them for another 6 years (They are actually good tenants).
We will try to do short term lets only in future. Certainly not more than a 6 month lease.
The 6K you spent on refurbisment is not wasted. You are giving a quality product.
It's not wasted on the tenants. It's wated by Paxman because he can't increase the rent to reflect the better quality product.
Brendan
Well, they couldn't go that far - that would very clearly be unconstitutional.To the point even when you cannot ever ask tenants to leave
Well, they couldn't go that far - that would very clearly be unconstitutional.
I strongly agree with you that the RPZ regime is both grossly unfair and counterproductive. However, I think you just need to accept that we are where we are.
Make your decision to retain or sell your rental on the basis of the hard numbers and your own personal risk assessment - don't let your emotions or sense of injustice get in the way.
Are you thinking of the Anti-Eviction Bill proposed by Ruth Coppinger earlier this year?
To be fair, that Bill (which wasn't passed) didn't propose that tenancies could never be terminated by a landlord.
In that case, you might find this thread of interest:-Most likely scenario is that we do short term for some of the year and leave empty when not let short term.
Possibly airbnb or something similar rather than 6 month lets.
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