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Inherited a house, opinions on my decision please!

  • 26-07-2007 5:02pm
    #1
    DublinWriter
    Registered Users, Registered Users 2 Posts: 9,560 ✭✭✭


    I am about to inherit my late Mum's house. It was valued at about 400K.

    The opinion I've come to is the following:

    If I keep the house and rent it out, I'd probably make about 15K pa gross on gross, which is before the usual maintenance costs. There would also be the hassle of chasing tenants for rent and I'd also have to put about 20K worth of work into the house to get it up to a standard for rental.

    The plan I've decided on was to sell the house and hopefully realise about 400K. At the very conservative strategy, I could probably get 4% - 5% if I put it on deposit. That's roughly the same as rental, but without the hassle and keeping the original sum safe.

    I wouldn’t put all the capital in a deposit account. I would probably put 75% of it in safe vehicles, such as deposit, government bonds etc, and put the rest in a variety of funds and shares.

    The flip-side of doing that is that I won't benefit from any capital appreciation in the coming years on the house, but I've come to the opinion that the salad days are over for the Dublin residential property market and we won't see the same levels of appreciation in the next 10 years.

    I don't want to turn this into a 'will the house market collapse' thread, one already exists, I'm looking for any criticisms on my specific decision.

    Many thanks,

    DW.


Comments

  • #2
    eclectichoney
    Closed Accounts Posts: 4,291 ✭✭✭eclectichoney


    Don't forget the income tax on the rental income (which could be 41%!). Tbh I would avoid letting it out as to me it would be too much hassle, but it's all down to personal choice i guess! good luck with it :)


  • #3
    daveirl
    Closed Accounts Posts: 14,483 ✭✭✭✭daveirl


    This post has been deleted.


  • #4
    Sonnenblumen
    Registered Users, Registered Users 2 Posts: 5,834 ✭✭✭Sonnenblumen


    Comparing yield to deposit returns is a no brainer, I'd go for 'monetising the asset'. If on the otherhand you are interested in capital appreciation of the asset, IMO, it is most unlikell that strong house price growth will resume in the near-medium term.

    All in all, I'd say the chips are stacked against rental, if you can and there's a willing customer, SELL. Easier said than done these days.

    Good luck


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