Rent a room scheme

[type53]

@deebouchie I (34F) have just bought a new build as a single person and am hoping to rent 1 room. Am apprehensive about doing it as its obviously new, and I'm putting a lot of money and effort into making it my home. I know that nobody will care about it like I do. I'm hoping to move in in the next two months, am thinking I should rent from the start before I get too comfortable by myself. Its very hard to turn away from a potential 1k a month

 

[jaydubb]

@type53 Just be sure to set ground rules and also put the agreement between you and the tenant in writing so that they know what to expect. Like the fact that rent is paid on X rate every month, bills shared etc. You don't need to do that but I've found it useful over the years.

 

[type53]

@jaydubb Yeah that's what I'm thinking. I did share a long time ago and was ok. Life changed a lot since a relationship breakdown recently so it will be a hge change. Might even be a good thing! I can always call it a day after 12 months if it doesn't work out

 

[jaydubb]

@type53 Exactly. The best thing about this scheme is that you're in full control. Hope it works out for you. I've been using it on and off for over ten years now so feel free to PM me if you need any tips on it!

 

[loveking]

@type53 I (33f) just bought my own place recently too, and on 1st Feb my lodger/tenant moved in... its only been a week or so, but so far so good. I'm based jn the countryside in Galway so had to do a lot of sifting to find the right person...
I put a handful of "rules" into the contract (such as keeping ventilation open to prevent mold etc.) which we discussed in person too...
It's only a 6 month contract initially, so we'll see how it goes

 

[wseleshi]

@deebouchie i did it for five years. Brilliant cash cow. Share bills too.

Simple tip: always put the kettle on when considering lodgers. If they cannot sit down and chat over a cup of tea then they won't communicate after moving in either.

What surprised me: nobody wanted a sitting room with a TV, or to hang out with housemates, people have their own lives, straight up to bedroom with laptops so get good wifi.

 

[milomarco]

@deebouchie Financially its a great scheme.. to maximise it out need to pay the mortgage or the majority of it yourself and use the Tennant rent as an overpayment.

View like that and you do it for a few years and you have your own place with a much smaller mortgage in 3 or 4 years. Your 1500/month will be down to 1k/ month after 3 or 4 years..

The experience is entirely down to who you pick to share with and how you treat them.

 

[southernyankee]

@deebouchie Be very careful who you take in..

 

[hhhlga89]

@deebouchie In your example I would assume you bought a 2 bed 2 bath apartment, even in a decent area most guests/tenants wouldn't be willing to pay more than 1k per month for a bedroom. The rent a room scheme is inclusive of utilities meaning that if you charge €900, you would need to subtract internet/gas/electricity from your profit.

The cons I see are:

• less privacy
• you'll have to share the fridge and the living space
• it'll be difficult or almost impossible to have family or friends over to stay overnight at a place you own
• sharing the kitchen and kitchenware
• unexpected maintenance costs
• potential careless/untidy tenant

Considering an optimistic net profit of 750 per month, that's 45k in 5 years.

Would you be willing to share the place you bought with so much effort for 5 years for 45k?

In my case, I would only consider it if I really needed the money for renovations or if the person living with me was a close friend.

 

[valetudo]

@hhhlga89 It’s €14k per year so you can charge up to €1166 per month inclusive of bills

 

[hhhlga89]

@valetudo €14k is quite optimistic, unless you own a 2-bedroom apartment in Ballsbridge/Docks, or you're renting to a couple, which is not typical for the average new buyer and has even more downsides.

 

[delia56]

@hhhlga89 it's not optimistic at all. it's pretty much guaranteed anywhere in dublin, even in balbriggan or jobstown

 

[hhhlga89]

@valetudo And even if you manage to rent a bedroom for €1,166, you're going to have a lot of tenants in rotation. Finding new tenants is a pain and is also like playing Russian roulette.

 

[valetudo]

@hhhlga89 Sorry but that’s completely naive. It’s essentially €1k per month excluding bills for half of a 2 bed apartment. If it’s anywhere in central Dublin then it’s basically a bargain in the current market. There would be no shortage of people wanting to rent the room

 

[hhhlga89]

@valetudo I respect your point of view but that's not what I've experienced. I struggled for over 2 months to find a suitable tenant for a bedroom in a central location. The rent was 950.

I have friends paying €1,100 - €1,200 inclusive of bills only at a prime location like Ranelagh or Milltown. It would be unimaginable for me to buy an apartment on my own there.

 

[valetudo]

@hhhlga89 If you live somewhere like Dorset Street then sure it would be a struggle to get a decent tenant to pay €1k+. Anyone buying a property >€400k in a decent location has the potential to max out the rent a room imo

 

[kevdog1232]

@hhhlga89 45K will likely be a quarter of my mortgage. That is a huge boost to equity and reduction in interest.

Saving on interest alone probably saves you the same amount again, 90-100k total, inclusive of the 45K.