What are the key considerations when taking on an investment property?
If you’re thinking of entering into property investment, here are some key things you should think about:
- Understand the rental market in your target area – for example, do a bit of research to identify typical renters (students, families, etc.), the most attractive property for rental purposes (apartments, houses, 2 beds or 3 beds, etc.), the average rental amount and the average time to letting when vacant. All of these questions can be answered by your local Estate Agent who can help guide you in your choice of property investment
- Plan to run your venture like a business and keep careful record of your finances. It’s a good idea to open a separate bank account for your rental property income and out-goings so that you can manage your finances closely. If possible get your rent paid by standing order into the account and keep accurate records of your property income and expenses including all receipts
- Make sure you make your tax return every year. Rental income is liable to income tax, PRSI and Universal Social Charge (USC) but you are allowed to offset certain expenses against your income tax. The Revenue Commissioners website has a useful `Revenue Guide to Rental Income’ for more information on this
- It’s important to keep your mortgage payments up to date. If you ever find that you are having difficulty with your repayments, or if you expect that you might have difficulty - talk to your bank.