The address:3 Colla Pier Cottages, Schull, Co Cork
The agent:James Lyons O'Keeffe
The property:four-bedroom holiday home with an asking price of €750,000.
The landscape:in an enviable position just two miles from Schull overlooking Colla Pier and Long Island Sound, this cottage is one of a group of eight holiday homes. Built around 20 years ago, when planning was a lot more lax, they are on the sea side of the Schull road.
The features:The 185sq m (2,000sq ft) cottage has been rented as a holiday home, is in good nick but décor is a bit dated.
How much for an investor to buy?The maximum loan considered for an investment property is 85 per cent of the value, with up to 100 per cent LTV considered for portfolio investors. The maximum term is 25 years.
At AIBs buy-to-let tracker rate of 5.5 per cent (APR 5.62 per cent), the repayments would be €3,908 per month.
With an interest-only loan the monthly repayments €2,922 per month (based on AIB's tracker rate of 5.5 per cent, APR 5.62 per cent).
How much for an owner occupier?First-time buyers borrowing up to 92 per cent of the property price would require a salary of around €164,000 to fund this mortgage over 35 years. A couple would require minimum incomes of around €76,000 each. At AIB's tracker rate of 5.3 per cent (APR 5.41 per cent) the repayments on this mortgage would be around €3,609 per month. Repayments at AIB's standard variable rate of 5.25 per cent (APR 5.36 per cent) would be around €3,581 per month.
Potential:Given its great scenic location, 3 Colla Pier Cottages will rent very well in the high season (around seven weeks) it will earn around €1,000 a week, according to selling agent Stephen O'Keeffe. For the remaining 13 weeks of the normal season it will earn at least €450 a week.
Verdict:Not an obvious investment opportunity priced at €750,000 this holiday home is firmly at the upper end of the market. It would most likely suit a buyer who wants a slice of west Cork and would be happy with, but not relying on, some supplemental rental income when not using the house themselves.
Calculations by AIB
- Fiona Tyrrell
