Caught in a property trap? Why not rent a room

You can beat the mortgage blues and survive the downturn if you have a room to rent, says property developer Bernie Walsh

ARE YOUR mortgage repayments getting you down? Embrace this season’s most covetable accessory, a room-mate. Get back in the black by renting a room.

The musical is back, claimed Hugh Jackman, as he tapped his way across the stage at Monday's show-stopping Oscar ceremony. And the musical most relevant to those of us with any sort of a property portfolio is Rent, an urbanrock opera whose main dramatic line is how to pay, or not pay, the rent.

It’s a sign of the times. Renting one or two rooms in your home can liberate liquidity and give short-term peace of mind to house-sellers unable to get the asking price they want for their homes.

Gerard O’Neill, chairman of Amárach Research, says there’s a big future for renting. Renting is the new buying, he claims in Daft.ie’s last quarterly report on the Irish property market.

There are already lots of households on board. House sharing adverts on Daft.ie have increased 12 per cent in the last 12 months. During the same period, average rents fell by 12 per cent which means renters hold all the cards. The secret to success is to offer a clean, well-designed space.

If you have rooms there are opportunities. Daft’s room-mate database is the ideal hunting ground. A search of room-mates in the Donnybrook area shows 12 different postings, all by clean and quiet living respondents willing to pay between €400 and €800 per month in rent. Gumtree is another option for the starter house-sharer at the lower end of the market.

As well as being the mortgage’s little helper, there are significant tax benefits to taking in roomies.

You can rent accommodation in your home, as long as it’s not to an adult son or daughter, up to €10,000 annually in income tax-free. Tenants can also claim rent relief and reduce their annual tax bill.

Bernie Walsh is a former property developer who recently had her hand forced by the falling property market.

She’s been investing in property for 20 years and has completed some 17 projects. Her first buy was 3 Lower Pembroke Street in Dublin 2 back in 1990, in the darkest days of a previous recession. It cost IR£260,000 to buy.

Her most recent project, 62 Mulgrave Street, Dún Laoghaire, is a fisherman’s cottage that has been extended to three times its original square footage. It is now a three-bedroom, two bathroom, neo-contemporary open-plan property.

“I bought the house a couple of years ago. The opportunity was in redevelopment for sale.” Halfway through the project she got that sinking feeling. The market faltered. Walsh had a choice. Try and hold onto the house or give it away on the open market.

“I started to explore the idea of taking in tenants. At the time I was living in another home so I moved out of it, rented it and moved into Mulgrave Street.”

Walsh struck tenant gold. She advertised on Daft’s housemate facility and got two “wonderful girls”: they are twentysomething Marketa Vokolkova, from Prague, whom she describes as a workaholic and clean freak and Dongxui Dai, a 42-year-old Chinese woman, who started the Falun Gong movement in Ireland. Both are virgos and both are extremely neat, which helps, she admits.

Bernie is part of the new demographic of house-sharing. She’s 47 years of age and the last time she had shared a house with strangers was in her mid-twenties.

“We’re reared to believe housesharing is something you grow out of. I went through a lot of angst, worry and anxiety about whom my new room-mates were going to be.”

While hunting for housemates she’s noticed a rise in the number of separated women who might have lived on their own for a year or so coming back to the idea of house-sharing.

She also came across her share of younger women who’ve gone the solo route, felt isolated on their own and then embrace the idea of having housemates.

“Having housemates has taken a lot of the pressure off and has allowed me to hold onto the property for the interim period,” Walsh admits. “They help lighten the burden and their contributions make the mortgage workable for me. In addition there is a great sense of camaraderie. You’re not on your own.”

Embrace the idea of sharing is her advice to anyone who finds themselves in a similar situation.

“Sharing is a scary prospect for most upwardly-conditioned thirty- and forty-somethings, but necessity is the mother of invention and the wonderful thing about sharing, in addition to having the burden of a large mortgage lightened, is that it is an exercise in flexibility. It makes us more confident in our ability to make things work and be more positive about the future.”

It’s a workable solution, says Walsh. And it’s good to be flexible, she adds. “By being adaptable you help instil confidence, a confidence that things are going to be okay.”

Walsh now hopes to use her expertise of building and renovating to help other people make descisons abou their space. Her business, Walsh Building Services, offers her expertise to anyone looking to extend, remodel or build from bare ground up.

“I can do project managing at every stage from planning, pricing and securing architects, builders and materials including furniture at the most competitive prices. “We’re offering a one-stop shop for design, build and fit-out, finding and bringing all the parties together under one umbrella.

“This ensures an efficient and fast building process at costs that compete favourably with the usual non-managed method of hiring an architect and builder separately.”

Bernie Walsh can be contacted on 01 2846620 or www.walshbuildingservices.ie (site under construction)