Address: Market Point, Mullingar, Co Westmeath.
Agent: Hooke & MacDonald and James B McDonnell.
Property type: two-bed Section 23 apartment from €280,000.
What do you get? A 62-70sq m (665-750sq ft) fitted-out apartment with car-parking. Apartments come with balconies and roof gardens and an extensive landscaped courtyard. They have main bedroom en suites, timber decked balconies, hardwood floors, fitted wardrobes and an intercom system. The tax break is 87 per cent and provides for investor relief on all rental income.
Where? Close to the centre of Mullingar by the Royal Canal. A new pedestrian bridge to the town's train station forms part of the development. Market Point is part of a new quarter with its own retail, commercial and leisure facilities. The development will include a crèche, restaurant and medical campus.
How much for an investor? The repayments on an 85 per cent mortgage over 25 years at the standard variable rate of 3.5 per cent would be or €1,190 per month. Where an investor has three or more investment properties with AIB, the pricing will be individually negotiated based on the risk assessment of the proposal where the loan-to-value is 75 per cent. With an interest-only loan, the repayment would be €694 per month based on a standard variable rate of 3.5 per cent.
How much to buy? For a young professional borrowing 100 per cent of the property price at AIB's one-year fixed new business rate of 2.75 per cent, the repayments would be €1,039 per month.
Single income required? A single first-time buyer would require a salary of €60,500 to fund this mortgage over 35 years.
Joint income required? A couple would require minimum income of €29,600 each to fund this mortgage over 35 years.
For first-time buyers borrowing up to 92 per cent of the property price on a one-year fixed new business rate of 2.75 per cent, the repayments on this mortgage would be €956 per month.
Single income required? A single first-time buyer would require a salary of €57,000 to fund this mortgage over 35 years.
Joint income required? A couple would require minimum incomes of €27,000 each to fund this mortgage over 35 years.
Potential? The rental return on a two-bed at Market Point is around €650 per month for a two-bed apartment. Mullingar has been designated a gateway town in the Government's National Spatial Strategy and is predicted to have significant population growth over the next seven years.
Verdict: the increasingly rare Section 23 designation will be a draw for some investors. But some may be deterred by the abundance of rental property in Mullingar competing for tenants and the limited rental return.
Calculations by AIB
-Edel Morgan
