The address: Baltard, Doonbeg, Co Clare.
The property: a four-bed cottage asking €135,000.
The agent:Sherry FitzGerald McMahon.
The landscape: halfway between the seaside village of Kilkee and Doonbeg with its swanky golf course, the house overlooks Farrihly Bay.
The features: accommodation in the 82sq m (882sq ft) house by the edge of the sea includes four bedrooms, livingroom and kitchen, but needs a revamp.
How much for an owner-occupier?A first-timer might secure a mortgage of 92 per cent or €124,200 at a rate of 2.49 per cent one-year fixed with AIB over 35 years. This would mean a repayment of €443 per month.
How much for an investor?Stamp duty on €135,000 will be €700 for investors, who could borrow €94,500 or 70 per cent of the purchase price. On a full-payment basis this would work out as €531 per month over 25 years and €362 per month interest-only. These figures are based on a variable rate of 4.6 per cent with ICS.
Potential?Depending on the intentions of the new owners, €50,000 could get the house into decent nick; of course there is the potential to spend a lot more for a more dramatic makeover. Peak season (May to September) rents for a cottage in this region of Co Clare are around €600 a week.
Verdict:if an investor got a rent of €600 a week for five months they could be looking at a very attractive yield of over 8 per cent. This however is not taking into account the finance required to get the property to rental standard or a diminished holiday home demand.
Calculations by AIB
