Landlords not allowed to sell home?

https://www.boards.ie/discussion/comment/122851525#Comment_122851525

Why? What will they say? If I'm renting it out I'll be doing it through an agengy and RTB etc all legit...

Toots

https://www.boards.ie/discussion/comment/122851533#Comment_122851533

It can change your rate. Buy-to-let rates are a lot higher than standard mortgage rates, so your repayment will increase.

https://www.boards.ie/discussion/comment/122851545#Comment_122851545

I'm on a fixed rate until 2030.

Maybe renting isn't for me I don't know. The stress alone of calling the bank and having them involved.

Thanks.

L1011

https://www.boards.ie/discussion/comment/122851584#Comment_122851584

It is almost certain that that fixed rate is dependent on it being your PPR; and will change as soon as you inform the bank it is now a rental.

I see sheep

https://www.boards.ie/discussion/2058380734/landlords-not-allowed-to-sell-home

Why don't you want to live in the house?

tom1ie

OP if I was on your situation I think I’d live in the house but rent out the rooms and avail of the rent a room scheme.
14k a year tax free under this scheme and the people renting would be licencee’s as opposed to tenants which gives you a lot more flexibility.
14k tax free is not to be sniffed at.

GSBellew

https://www.boards.ie/discussion/comment/122840551#Comment_122840551

If you sell it now it is your PPR and you escape liability for CGT on the sale proceeds, if you move out it is no longer your PPR and whilst it may go up in value in the interim your CGT liability on the sales proceeds will instantly dig into any future gains.

mrslancaster

https://www.boards.ie/discussion/comment/122851533#Comment_122851533

Check with your lender about the higher btl rate. Calculate the mortgage increase, rental taxes, agents fees, insurance, maintenance, plus cgt when you sell after x years. It might be better to rent a room as others have suggested, or short airbnb lets that are allowed in your ppr. If you need to move for work or family reasons, or you hate the area and will never live in the house again, selling in a strong market is not the worst option.

Thanks for replies. I've arranged a call with the bank tomorrow to ask what the options are.

I'll have to put all the figures down on paper and decide.

https://www.boards.ie/discussion/comment/122851644#Comment_122851644

It's a good option alright but I can't stand the area anymore.

travist

https://www.boards.ie/discussion/comment/122851584#Comment_122851584

" The stress alone of calling the bank" …yet you want to be a landlord !?

GreeBo

https://www.boards.ie/discussion/comment/122842116#Comment_122842116

If you sell it, invest the proceeds (if any) and the save/invest the equivalent mortgage repayments in all likelihood you will end up in the same place as if you were to hold onto it, without any fear of getting "stuck" with tenants.

Otherwise set it up as AirBNB until you know what you want to do with it.

SupaCat95

https://www.boards.ie/discussion/comment/122852346#Comment_122852346

Ahhhh Jaysus, Dont go there. Being a Landlord will send you to an early grave. Tenants late rent, is the ESB paid, Damage, maintenance, pets, arguements with neighbours, the list is endless without mentioning the taxman (love them audits). American economy will go into a natural small recession soon and there will be a quick bounce back. That will be shown here to proportionally

https://www.boards.ie/discussion/comment/122840158#Comment_122840158

If the contract is irrelevant then why is there any mention of a duration on a contract?

L1011

https://www.boards.ie/discussion/comment/122863058#Comment_122863058

Because that defines other things like rent reviews. But it is not a way around the rules

csirl

https://www.boards.ie/discussion/comment/122840307#Comment_122840307

What about people who want to be short term landlords? Many people have to move out of their homes from time to time for reasons such as working abroad, moving in to look after an elderly relative, moving into a nursing home if elderly etc. etc. Traditionally many rented out their home for maybe 2-3 years. These properties were a much needed addition to the countries rental stock. Now gone. Nobody in their right mind will rent out their vacant home short term from now onwards.

I know someone myself who is moving in with a elderly parent who needs care. They've decided to leave their home vacant rather than rent out. In the past they've rented it out for a couple of years when working abroad. But cant take the risk of being homeless when their elderly parent passes away.

https://www.boards.ie/discussion/comment/122852022#Comment_122852022

I spoke to lender today about all options. They said if I rent it out it becomes a buy to let status and my rate will change but they said it won't change until my fixed rate expires in 2030...

I asked how much it would go up (just based on today's calculations) and it adds a lot to my mortgage repayments! It would't be worth it.

L1011

https://www.boards.ie/discussion/comment/122863179#Comment_122863179

That's the result of the legal structure here; and its not likely to change.

https://www.boards.ie/discussion/comment/122863179#Comment_122863179

This is the thing about selling it now before I'm ready to buy again, circumstances could change in my mam's house. I calculated I would need to save for 3.5 years to save for next house. If I sell now that could be 2 years but maybe not if property prices are still this high in Dublin.

After all this talk I might end up doing option 3 - leaving it vacant!!! I'd have to install a doorbell camera or something like that hooked up to my phone though. Almost every time I go back to house the gate is open and there are no letters in letterbox. Front garden table was robbed too.

And on another note, I know for a fact that Sinn Fein's advice to people who ring up their local TD about the landlord selling is - overhold. They explicitly tell them to do this. I'm not saying this with an agenda or anything but it's what I've heard a lot through other people.

L1011

https://www.boards.ie/discussion/comment/122863250#Comment_122863250

You will seriously, seriously struggle to find insurance for an empty house that will satisfy the requirements of your mortgage lender. I'd be tempted to say you just won't.

Leaving houses empty is really only an option for those who own them outright.

csirl

https://www.boards.ie/discussion/comment/122863465#Comment_122863465

There are summer only AirB&B and holiday homes that are vacant most of the year, yet still insured without any difficulty. Many of them have mortgages.

L1011

https://www.boards.ie/discussion/comment/122863911#Comment_122863911

I'd guarantee that none of them have insurance that actually meets what their lender wants

Typical holiday home cover requires the water, at least; and sometimes power and gas if fitted, to be turned off if unoccupied for 30 days. Many lapse to covering virtually nothing if there's less than monthly visits.

Having insurance is absolutely useless if you didn't read the terms and don't realise you aren't covered.

Now, try find insurance for a completely empty house. Seriously, try.

csirl

https://www.boards.ie/discussion/comment/122863923#Comment_122863923

Monthly visits arent difficult to do. Nor is someone staying overnight the odd time.

L1011

https://www.boards.ie/discussion/comment/122864327#Comment_122864327

Bit of a pain to drain down the water after each overnight visit.

I would suggest that the vast majority of people who think they're insured for a holiday home or vacant property, basically aren't due to not following the T&Cs of the insurance.

Also, empty while living somewhere else is still not a PPR for purposes of a PPR mortgage.

csirl

https://www.boards.ie/discussion/comment/122865081#Comment_122865081

Note that Im not familiar with the OP, their mortgage or their insurance.

But , I was a "reluctant landlord" for a period of time a few years ago. Bank was fully aware. Had zero impact on the mortgage etc. In reality, the banks dont care if its your PPR or not so long as you have sufficient income to pay the mortgage.

I dont buy that its impossible to insure an occasionally occupied house. Insurance may be higher, but you will get insured.

L1011

https://www.boards.ie/discussion/comment/122865592#Comment_122865592

The OP has already said the bank will increase the interest rate punitively, albeit after their current fix ends. They absolutely do care; BTL rates are much higher and require a lower LTV%, they cannot legitimately securitise a BTL property as being a PPR mortgage.

Go find insurance for empty houses - you just won't; or the conditions will be expensive (property must be heated, monitored alarm etc) or implausible (visit every 14-30 days, drain down the water tanks etc).

People think they have insurance for their holiday homes or empty former PPRs and get horribly surprised when claims are denied as they never read the T&Cs.

csirl

https://www.boards.ie/discussion/comment/122865617#Comment_122865617

That's interesting. I may be able to help the OP with this one.

I was a reluctant landlord when we had to move due to my wifes job post financial crash when our house was in negative equity. We were lucky that my wifes family allowed us live in a vacant house one of them owned.

Banks will initially allude to an interest rate rise as they assume you're turning it into a rental/investment property. They assume that you're more risky as you'll have to pay a mortgage or rent on another property and people will prioritise payments to keep a roof over their own heads ahead of those on a rented out house.

But once it was explained that the house was going to be the only home we owned and there are no other priority outgoings,or any other PPR mortgage they agreed that it was less risky than before, as obviously rental income adds to capacity to repay!

Banks are fine with it if its your only mortgage. Different story if its a second property and you've 2 mortgages.

Ray Palmer

Just to point out another issue described here about CGT. It would only start from the year you rented it out. That would only be charge on the increase since it was rented not from purchase.

L1011

https://www.boards.ie/discussion/comment/122865683#Comment_122865683

Experience from the crash and experience now can't be compared - banks were trying to stop people going in to arrears then. Now they want/need to keep their books in an orderly fashion and aren't going to agree to keep a non PPR on a PPR deal; particularly as a loan book could be sold at any stage and needs to match its description.