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Reluctant landlord

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  • 11-11-2018 1:32am
    #1
    iwilldare
    Registered Users Posts: 42 ✭


    Hi There,

    Going to be moving from my house that I have lived in for the past 11 years and will be renting it out.
    I'm fairly nervous about this as have heard horror stories regarding nightmare tenants etc. I'd appreciate some advice on letting agencies (are they worth using) Screening potential tenents etc

    Many thanks in advance


«1

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    #2
    Caranica
    Registered Users Posts: 10,029 ✭✭✭✭Caranica


    iwilldare wrote: »
    Hi There,

    Going to be moving from my house that I have lived in for the past 11 years and will be renting it out.
    I'm fairly nervous about this as have heard horror stories regarding nightmare tenants etc. I'd appreciate some advice on letting agencies (are they worth using) Screening potential tenents etc

    Many thanks in advance

    Is selling an option? Truly wouldn't recommend being a landlord to my worst enemy.


  • Options
    #3
    Atlantic Dawn
    Registered Users Posts: 81,338 ✭✭✭✭Atlantic Dawn
    M


    Sell it.


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    #4
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    cant sell, its still in negative equity. Would sell in a heartbeat if I could.


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    #5
    The Student
    Registered Users Posts: 1,249 ✭✭✭The Student


    iwilldare wrote: »
    Hi There,

    Going to be moving from my house that I have lived in for the past 11 years and will be renting it out.
    I'm fairly nervous about this as have heard horror stories regarding nightmare tenants etc. I'd appreciate some advice on letting agencies (are they worth using) Screening potential tenents etc

    Many thanks in advance

    It takes a certain type of person to be a landlord. If you are not strong enough you will find it difficult if you find wrong tenant. Have you considered renting to council on one of their long term rental schemes.


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    #6
    Jack0125
    Registered Users Posts: 38 ✭Jack0125


    Get a property mgt agent. Will cost you gross 800 a year...but with tax relief (depending on situation) net cost for 400 euro you have someone who deals with all letting and tenant queries.


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    #7
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    The Student wrote: »
    iwilldare wrote: »
    Hi There,

    Going to be moving from my house that I have lived in for the past 11 years and will be renting it out.
    I'm fairly nervous about this as have heard horror stories regarding nightmare tenants etc. I'd appreciate some advice on letting agencies (are they worth using) Screening potential tenents etc

    Many thanks in advance

    It takes a certain type of person to be a landlord. If you are not strong enough you will find it difficult if you find wrong tenant. Have you considered renting to council on one of their long term rental schemes.
    Have no problem with treating it like a business, but getting the right Tennant seems like pot luck though, don't want someone moving in an wrecking the place or not paying rent and having to go through the eviction process as it seems to take years


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    #8
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Jack0125 wrote: »
    Get a property mgt agent. Will cost you gross 800 a year...but with tax relief (depending on situation) net cost for 400 euro you have someone who deals with all letting and tenant queries.

    I Wouldn’t trust a letting agent to look after my umbrella never mind my house. A waste of money who will do a worse job than you could yourself. No way would I trust them to pick the type of tenant I’d want most of all and I’m this day and age getting the wrong tenant is a disaster.


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    #9
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    Levi Damaged Collarbone wrote: »
    Jack0125 wrote: »
    Get a property mgt agent. Will cost you gross 800 a year...but with tax relief (depending on situation) net cost for 400 euro you have someone who deals with all letting and tenant queries.

    I Wouldn’t trust a letting agent to look after my umbrella never mind my house. A waste of money who will do a worse job than you could yourself. No way would I trust them to pick the type of tenant I’d want most of all and I’m this day and age getting the wrong tenant is a disaster.
    But do they not take the day to day hassle out of managing the property? Or are there any advantages to using an agent?


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    #10
    Cuddlesworth
    Registered Users Posts: 13,981 ✭✭✭✭Cuddlesworth


    I assume since its still in negative equity its not in a high demand area.


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    #11
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    Cuddlesworth wrote: »
    I assume since its still in negative equity its not in a high demand area.

    You assume incorrectly,it's a very high demand area


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    #12
    davindub
    Registered Users Posts: 1,447 ✭✭✭davindub


    iwilldare wrote: »
    But do they not take the day to day hassle out of managing the property? Or are there any advantages to using an agent?

    It depends what you agree with them, you can either just get them to find someone and handle the lease or you can get them to manage the tenancy.

    I prefer to handle it myself, there isn't much work in arranging maintenance but I would recommend if it is the 1st time letting, use an agency, you need a proper lease document so you would end up paying a solicitor for this anyway. After that check the rent is paid on time (standing order only) and inspect periodically with the tenants permission.

    Keep the tenants onside as a customer and you reduce the risk of non-payment or trashing the place, unless you get the kind of tenant who really doesn't care, which to be fair is rare, just manage the risk and the returns are worthwhile. In my opinion, if you are in a RPZ you can legally increase the rent annually, but you are not giving anything back to the tenant for loyalty and paying on time, why would they see it as important to continue doing so? Etc.


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    #13
    Cuddlesworth
    Registered Users Posts: 13,981 ✭✭✭✭Cuddlesworth


    iwilldare wrote: »
    You assume incorrectly,it's a very high demand area

    Good.
    • Rent out each bedroom at a weekly rate, bills included. If there is a sitting room/dining room, convert them to bedrooms.
    • No leases.
    • Take 4 weeks deposit from each, nobody moves in until money is in your account.
    • Each individual gets a ID number, they use it for referencing payments. Make sure you get your rent every week, no late payments.
    • No friends, no girlfriends, no party's period. Nobody but them into the house.
    • Keep the bills in your name. Don't bother with broadband, tenants can use 3g keys. Nobody gets a line into the house with a contract.
    • Hire a cleaner, they clean the whole house once a week(hoover, wipe surfaces, clean bathroom etc) including bedrooms. Have them report any tenants who don't keep the place clean or let the place get into a state.
    • No locks on doors, no locked door but the front.

    You now have licensees.

    See point 3 on RTB's own site.

    persons occupying accommodation in which the owner is not resident under a formal license arrangement with the owner where the occupants are not entitled to its exclusive use and the owner has continuing access to the accommodation and/or can move around or change the occupants,

    Your licensees have no say in who rents there, you do. They don't have exclusive use, you, the cleaner or anybody else can walk into a bedroom whenever they want. You are effectively running a long term B&B, skirting around the law.

    Any trouble maker, late rent or other issues, turf them. How quickly, immediately or a week, is up to you. There are other people in the house, they are far less likely to try trashing anything. Any damages, take out of deposit.

    A 4 bed house can easily become a 6 bed house to rent. In high demand areas, 115-150 per week bills included is achievable, loads of people just want a room to rent. Adjust pricing based on demand and room size.

    Its pretty easy to pull in 25k+ gross per year, within little to no downtime, as individual tenants move in and out. Takes a bit more time to manage though.


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    #14
    davindub
    Registered Users Posts: 1,447 ✭✭✭davindub


    Cuddlesworth wrote: »
    Good.
    • Rent out each bedroom at a weekly rate, bills included. If there is a sitting room/dining room, convert them to bedrooms.
    • No leases.
    • Take 4 weeks deposit from each, nobody moves in until money is in your account.
    • Each individual gets a ID number, they use it for referencing payments. Make sure you get your rent every week, no late payments.
    • No friends, no girlfriends, no party's period. Nobody but them into the house.
    • Keep the bills in your name. Don't bother with broadband, tenants can use 3g keys. Nobody gets a line into the house with a contract.
    • Hire a cleaner, they clean the whole house once a week(hoover, wipe surfaces, clean bathroom etc) including bedrooms. Have them report any tenants who don't keep the place clean or let the place get into a state.
    • No locks on doors, no locked door but the front.

    You now have licensees.

    See point 3 on RTB's own site.

    persons occupying accommodation in which the owner is not resident under a formal license arrangement with the owner where the occupants are not entitled to its exclusive use and the owner has continuing access to the accommodation and/or can move around or change the occupants,

    Your licensees have no say in who rents there, you do. They don't have exclusive use, you, the cleaner or anybody else can walk into a bedroom whenever they want. You are effectively running a long term B&B, skirting around the law.

    Any trouble maker, late rent or other issues, turf them. How quickly, immediately or a week, is up to you. There are other people in the house, they are far less likely to try trashing anything. Any damages, take out of deposit.

    A 4 bed house can easily become a 6 bed house to rent. In high demand areas, 115-150 per week bills included is achievable, loads of people just want a room to rent. Adjust pricing based on demand and room size.

    Its pretty easy to pull in 25k+ gross per year, within little to no downtime, as individual tenants move in and out. Takes a bit more time to manage though.

    It wouldn't work, tenancies are created by lease or by payment, there really isn't a loophole to avoid a tenancy. What that text seems to be referring to is guesthouse accommodation, it does seem rather poorly written though.

    "which the owner is not resident under a formal license arrangement with the owner" -- nonsense the owner is not resident under a license agreement with himself?


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    #15
    The Student
    Registered Users Posts: 1,249 ✭✭✭The Student


    iwilldare wrote: »
    Have no problem with treating it like a business, but getting the right Tennant seems like pot luck though, don't want someone moving in an wrecking the place or not paying rent and having to go through the eviction process as it seems to take years

    Sorry when you titled thread I thought you did not really want to rent out property and you were being forced. Use an agent to find the tenants as once you put up and ad you will be flooded with enquirers. I would suggest you manage property yourself as agent will get tradesmen for everything who may not necessarily be the best. If you want to pm me I can answer questions give guidance.


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    #16
    Cuddlesworth
    Registered Users Posts: 13,981 ✭✭✭✭Cuddlesworth


    davindub wrote: »
    It wouldn't work, tenancies are created by lease or by payment, there really isn't a loophole to avoid a tenancy. What that text seems to be referring to is guesthouse accommodation, it does seem rather poorly written though.

    "which the owner is not resident under a formal license arrangement with the owner" -- nonsense the owner is not resident under a license agreement with himself?

    "which the owner is not resident, under a formal license arrangement with the owner"

    They had to add a section pointing out that you can in fact be a licensee even when the property owner does not live with you.

    The RTB and tenancy law is only applicable when the person renting has exclusive use of the property. Previous rulings have shown that to be the ability to say who they rent with, who can come and go to to the property. Once they never had exclusive use of anything besides a expectation of privacy in their room, they are not a tenant.

    If tenancy's were created by payment, every hotel and B&B in the country would be a big trouble.


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    #17
    davindub
    Registered Users Posts: 1,447 ✭✭✭davindub


    Cuddlesworth wrote: »
    "which the owner is not resident, under a formal license arrangement with the owner"

    They had to add a section pointing out that you can in fact be a licensee even when the property owner does not live with you.

    The RTB and tenancy law is only applicable when the person renting has exclusive use of the property. Previous rulings have shown that to be the ability to say who they rent with, who can come and go to to the property. Once they never had exclusive use of anything besides a expectation of privacy in their room, they are not a tenant.

    If tenancy's were created by payment, every hotel and B&B in the country would be a big trouble.

    But you added the comma yourself? Changes the meaning entirely.

    Which rulings are you talking about exactly that state exclusive use of the property is required? Exclusive use and possession are kind of old pre-RTA tests which are sometimes useful to use, but they are not the only factor considered. There is a specific HC case that mirrors what this passage seems to be referring to, it was a long term room within a guesthouse.

    Hotels and b&bs are excluded from the act - holiday accommodation. You can research the meaning of tenancy yourself.

    But for reading this passage on the RTB website and applying your own logic, you would not have concocted your scheme? Have you verified it against the act? Have you tested this somewhere or does the OP test for you and face the consequences alone if the RTB disagrees? When you answer these questions, what you have posted looks less appealing.

    Anyway, none of this is relevant to the OP's post, it is not possible for a residential landlord to exclude themselves from the legislation except for the exclusions contained within the act, and if such a great loophole was found, it would be rectified rather than advertised.


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    #18
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    Cuddlesworth wrote: »
    Good.
    • Rent out each bedroom at a weekly rate, bills included. If there is a sitting room/dining room, convert them to bedrooms.
    • No leases.
    • Take 4 weeks deposit from each, nobody moves in until money is in your account.
    • Each individual gets a ID number, they use it for referencing payments. Make sure you get your rent every week, no late payments.
    • No friends, no girlfriends, no party's period. Nobody but them into the house.
    • Keep the bills in your name. Don't bother with broadband, tenants can use 3g keys. Nobody gets a line into the house with a contract.
    • Hire a cleaner, they clean the whole house once a week(hoover, wipe surfaces, clean bathroom etc) including bedrooms. Have them report any tenants who don't keep the place clean or let the place get into a state.
    • No locks on doors, no locked door but the front.

    You now have licensees.

    See point 3 on RTB's own site.

    persons occupying accommodation in which the owner is not resident under a formal license arrangement with the owner where the occupants are not entitled to its exclusive use and the owner has continuing access to the accommodation and/or can move around or change the occupants,

    Your licensees have no say in who rents there, you do. They don't have exclusive use, you, the cleaner or anybody else can walk into a bedroom whenever they want. You are effectively running a long term B&B, skirting around the law.

    Any trouble maker, late rent or other issues, turf them. How quickly, immediately or a week, is up to you. There are other people in the house, they are far less likely to try trashing anything. Any damages, take out of deposit.

    A 4 bed house can easily become a 6 bed house to rent. In high demand areas, 115-150 per week bills included is achievable, loads of people just want a room to rent. Adjust pricing based on demand and room size.

    Its pretty easy to pull in 25k+ gross per year, within little to no downtime, as individual tenants move in and out. Takes a bit more time to manage though.

    Thanks, when I said I have not problem treating it like a business I meant letting it entirely. I've no interest in being a slum landlord.


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    #19
    filbert the fox
    Registered Users Posts: 809 ✭✭✭filbert the fox


    iwilldare wrote: »
    Hi There,

    Going to be moving from my house that I have lived in for the past 11 years and will be renting it out.
    I'm fairly nervous about this as have heard horror stories regarding nightmare tenants etc. I'd appreciate some advice on letting agencies (are they worth using) Screening potential tenents etc

    Many thanks in advance

    Why are you moving out if you don't mind me asking?
    The over generous Rent a Room scheme would allow you to earn up to €14,000 per annum tax free if you stay and take in lodgers. Any possibility of this occurring?
    Otherwise the Taxman will take 52% of your rental income(gross....in both senses of the word)

    :mad:


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    #20
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    filbert the fox wrote: »
    Why are you moving out if you don't mind me asking?
    The over generous Rent a Room scheme would allow you to earn up to €14,000 per annum tax free if you stay and take in lodgers. Any possibility of this occurring?
    Otherwise the Taxman will take 52% of your rental income(gross....in both senses of the word)

    :mad:

    Moving into a larger property that is more suited to me and my family am just renovating at the moment but should be in shortly. Yeah I know about the tax, its crazy but hopefully I will just about break even when renting the house out.


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    #21
    LuckyLloyd
    Registered Users Posts: 36,157 ✭✭✭✭LuckyLloyd


    Rents are at record breaking levels. Literally never been higher in the history of the state. As yours will be a new rental you can get top of the market value. Contact a letting agent, have them rent it out to a record breaking level and be happy. Shop around on letting agents in terms of the services / fees offered and seek out some reviews first. But that's it. The horror stories are a tiny percentage of lets. Most people are reasonable and credible and the documentation / process imposed by letting agents now as standard will usually weed out undesirable tenants.

    Best of luck.


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    #22
    Cuddlesworth
    Registered Users Posts: 13,981 ✭✭✭✭Cuddlesworth


    iwilldare wrote: »
    Thanks, when I said I have not problem treating it like a business I meant letting it entirely. I've no interest in being a slum landlord.

    The day you encounter a problem tenant and have to work with the RTB is day the you will be a bitter reluctant landlord. Plus on average, you give up around 10k per year in income by renting the property as a whole.


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    #23
    Cuddlesworth
    Registered Users Posts: 13,981 ✭✭✭✭Cuddlesworth


    davindub wrote: »
    But you added the comma yourself? Changes the meaning entirely.

    You appeared to have a issue with how they had presented it on their site.
    davindub wrote: »
    Which rulings are you talking about exactly that state exclusive use of the property is required? Exclusive use and possession are kind of old pre-RTA tests which are sometimes useful to use, but they are not the only factor considered. There is a specific HC case that mirrors what this passage seems to be referring to, it was a long term room within a guesthouse.

    I refer to the guesthouse and a apartment tenant in past rulings. Finding it hard to go back over my posts here and find where I went through both rulings. Both rulings were based on the premise of exclusive access to the property(B&B was non-exclusive, apartment tenant was exclusive use).

    If you are deemed to be a licensee by the RTB, meeting the criteria set out by the act and the RTB, then your relationship with the landlord is not applicable to the act and you no longer have the same protections.

    The RTB themselves are very clear on this, on their site and in rulings. I am aware of a number of landlords doing this in Dublin, whose licensees have tried and failed to take a case against them in the RTB.

    https://www.icsh.ie/sites/default/files/8_rtb_lease_vs_licence_guidance_note.pdf
    davindub wrote: »
    But for reading this passage on the RTB website and applying your own logic, you would not have concocted your scheme? Have you verified it against the act? Have you tested this somewhere or does the OP test for you and face the consequences alone if the RTB disagrees? When you answer these questions, what you have posted looks less appealing.

    I added the comma to show what the RTB meant to convey. You can remove it if you wish, find a landlord offering a licensee arrangement and then take it through the courts if you want. Because I know the RTB won't take your case if the landlord does it correctly and the courts won't treat it as a tenancy if the landlord doesn't.


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    #24
    Claw Hammer
    Registered Users Posts: 6,163 ✭✭✭Claw Hammer


    I have seen landlords being prosecuted in the District Court for non-registration of tenancies. Their defence was that they had entered a licence agreement. Invariably they were convicted and fined.


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    #25
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    Cuddlesworth wrote: »
    The day you encounter a problem tenant and have to work with the RTB is day the you will be a bitter reluctant landlord. Plus on average, you give up around 10k per year in income by renting the property as a whole.

    Hopefully I dont experience that but am aware of the pitfalls now.
    Thanks to all for the advice given, think I am going to manage the letting myself. A work college has given me a letting agreement and some good advice also so will work off that and hopefully be able to vet a decent tenant who doesn't trash the place or refuses to pay rent after 6 months :o


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    #26
    Geuze
    Registered Users Posts: 13,105 ✭✭✭✭Geuze


    iwilldare wrote: »
    cant sell, its still in negative equity. Would sell in a heartbeat if I could.


    In negative equity after 11 years?

    Say bought in 2007.

    If it's in a high-demand area, could it still be in negative equity?

    I hope people aren't confusing negative equity with capital losses.


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    #27
    Claw Hammer
    Registered Users Posts: 6,163 ✭✭✭Claw Hammer


    Geuze wrote: »
    In negative equity after 11 years?

    Say bought in 2007.

    If it's in a high-demand area, could it still be in negative equity?

    I hope people aren't confusing negative equity with capital losses.

    A lot of property is not back to 2007 prices. Some are still around 505 of peak.


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    #28
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    Geuze wrote: »
    In negative equity after 11 years?

    Say bought in 2007.

    If it's in a high-demand area, could it still be in negative equity?

    I hope people aren't confusing negative equity with capital losses.

    bought for 350,000
    Now worth 250,000 -260,000
    Approx 70/75k paid off mortgage

    Its not huge NE but still am not taking the hit

    Its a hight demand area for rentals, about 8 currently on daft, but its not killiney :D


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    #29
    iwilldare
    Registered Users Posts: 42 ✭iwilldare


    iwilldare wrote: »
    bought for 350,000
    Now worth 250,000 -260,000
    Approx 70/75k paid off mortgage

    Its not huge NE but still am not taking the hit

    Its a hight demand area for rentals, about 8 currently on daft, but its not killiney :D

    Plus its a tracker mortgage (remember them) so will hold on to it for now and see what happens in the future.


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    #30
    davindub
    Registered Users Posts: 1,447 ✭✭✭davindub


    Cuddlesworth wrote: »
    You appeared to have a issue with how they had presented it on their site.



    I refer to the guesthouse and a apartment tenant in past rulings. Finding it hard to go back over my posts here and find where I went through both rulings. Both rulings were based on the premise of exclusive access to the property(B&B was non-exclusive, apartment tenant was exclusive use).

    If you are deemed to be a licensee by the RTB, meeting the criteria set out by the act and the RTB, then your relationship with the landlord is not applicable to the act and you no longer have the same protections.

    The RTB themselves are very clear on this, on their site and in rulings. I am aware of a number of landlords doing this in Dublin, whose licensees have tried and failed to take a case against them in the RTB.

    https://www.icsh.ie/sites/default/files/8_rtb_lease_vs_licence_guidance_note.pdf



    I added the comma to show what the RTB meant to convey. You can remove it if you wish, find a landlord offering a licensee arrangement and then take it through the courts if you want. Because I know the RTB won't take your case if the landlord does it correctly and the courts won't treat it as a tenancy if the landlord doesn't.

    The RTB won't take the case because of locus standi.

    Look I feel this has been well covered over the last 14 years since the introduction of the act and previously under the landlord and tenant acts, no one claiming these type of claims can actually link a single case despite claiming they know of cases. So I suppose either link a case or don't claim you have examples at all. Even on the link you've posted above, it gives the examples of guesthouse, b&b & owner occupied dwellings, all of which can be linked back to the RTA itself.

    I wouldn't believe anyone who runs a property in this manner and claims to be legal which I suppose goes back to actually finding a case where it has been tested.


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    #31
    Geuze
    Registered Users Posts: 13,105 ✭✭✭✭Geuze


    iwilldare wrote: »
    bought for 350,000
    Now worth 250,000 -260,000
    Approx 70/75k paid off mortgage

    Its not huge NE but still am not taking the hit

    Its a hight demand area for rentals, about 8 currently on daft, but its not killiney :D

    Bought at 350k.

    Assume 90% mortgage 315k.

    Mortgage now 240-245k.

    House not worth 250-260k

    So not in negative equity.

    Capital loss - yes.


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