Ireland has a strong and dynamic property market, with high property prices, high rents and a range of property types to invest in.
From city apartments, suburban rental homes, property in bustling regional towns, and scenic tourist destinations all offering potential for a high yield on your investment. There are also tax incentives available for investing in property in Ireland.
MortgageOne are long established financial services and insurance specialists and we can find you the best buy to let mortgage rates from lenders in the Irish market. We can also advise you about the Irish insurance market, including landlord’s insurance.
Table of Contents
- Is Ireland a good place to buy an investment property?
- How to buy an investment property in Ireland
- Tax on investment property in Ireland
- Mortgage for investment property in Ireland
- Insurance for an investment property in Ireland
- For more information take use our Mortgage Calculator
- Speak to a mortgage expert today
- Ready to Get Started?
Is Ireland a good place to buy an investment property?
Ireland has a growing population with high incomes and demand is exceptionally strong for rental properties. Rents are at a historic high in Ireland at the moment.
Ireland’s national Residential Property Price Index shows an increase of 1.4% in the twelve months up to September 2023, with some areas showing an increase in property prices of 4% if capital appreciation in the long term is your goal.
How to buy an investment property in Ireland
Firstly, it is important to consider your goals in investing in Irish property. You may want to generate rental income or you may purchase the investment property for capital appreciation, or both.
Research the property market as the location you choose and/or the property you purchase may be more suitable for long term residential letting, short term letting, tourist lets, or student accommodation and this should align with your goals.
Firm up your budget, taking property prices and associated expenses, finance available, and, if you are borrowing in Ireland, Central Bank lending rules.
Get expert advice. Buying property requires you to get specialist advice at each stage of the process. You may need advice from estate agents, valuers, surveyors, and you will certainly need legal advice and a solicitor to carry out conveyancing.
For mortgage advice as well as advice on insuring your investment property, with buildings insurance or landlord’s liability insurance, MortgageOne is your mortgage and insurance specialist. Use our mortgage calculator to see if you are eligible for a buy to let mortgage and how much you could borrow.
Tax on investment property in Ireland
There are several forms of tax relevant to investment property in Ireland.
Income tax on rental income will be payable annually and the rate can be up to 55%, with deductions for certain expenses allowed. The amount you will be required to pay depends on your overall income and tax credits.
Local Property Tax is payable annually and is based on the value of your investment property. LPT rates can vary from around €90 to around €2,000 each year.
If you sell your investment property, you may be liable for Capital Gains Tax, currently at 33%, depending on your circumstances.
Stamp Duty is payable when you purchase a property and the rate you pay depends on the purchase price of the property. Properties up to €1 million will be liable for 1% Stamp Duty, and properties over €1 million are liable for 2% Stamp Duty, as a general guide.
Always consult an independent expert tax advisor.
Mortgage for investment property in Ireland
For buy to let investors, Central Bank rules state that the loan to value of the property must be no more than 70%.
This means that you will need at least 30% of the purchase price as a deposit.
To qualify for a buy to let mortgage you will need to show a good credit history, and you will need to demonstrate that the mortgage is affordable for you with a good income and sufficient projected rental income, and you will show how you will pay the mortgage during times where the property is vacant.
Where you wish to invest in a property and have not yet liquidated another asset or sold another property, you may also qualify for bridging finance.
Insurance for an investment property in Ireland
It is not a legal requirement to have mortgage protection or life insurance in place in order to take out a loan on an investment property but a lender may require you to have adequate buildings insurance in place to protect the property.
Landlord’s insurance is usually a combination of buildings insurance and landlord’s liability insurance, and may also offer protection for landlord’s contents and loss of rent. This is not a legal requirement but the protection offered for loss of rent is very valuable.
Speak to a mortgage expert today
Speak to a qualified financial advisor today. Our mortgage specialists can provide advice and information on financing your property investment.
Give us your details and we can call you, or you can contact us by phone and arrange to speak to an expert. We have a proven track record in financial services and work with lenders in the Irish market who want to fund your property investment.
