Ready to be a property landlord?
This was an interesting article in independent.ie highlighting some of the return on investment realities for current or would-be landlords. As the property market recovers and gains strength, there will be gathering momentum behind rental rates and investors looking to either dip their toe into the property investment market or for existing landlords to increase their footprint.
But, its important that the full extent of the investment opportunity and cost are examined. The article points out that in cities in particular, the yield may not be that attractive. For those investors borrowing against the properties, there are many associated costs to be considered - mortgage interest and capital payments, local property taxes, running costs, income tax etc. - many owners will be bearing a net loss when these costs are factored in.
For cash buyers, the situation is entirely different as the deposit interest available will mean they can achieve a higher yield through a property asset.
The issue of offering longer leases to long term rental customers is also a complicated area and one that will require much discussion in the future as we move from a market where owning a property was the norm to a model where long term rental is a reality for many.