All Forum Posts by: Howard Barrett

@Mark C. Property here usually sell 10% under asking price according to estate agents we’ve spoken with so starting at 20% under seems reasonable. Keeping your eye out for hand written vende-se signs could be a good way in too. Idealista and olx are good places to search. We brought a piece of land with a ruin from olx and the photos were dreadful, made it look like a boring old field, not the beautiful Douro side plot that it actually is. So there’s some poorly advertised private sales about that can lead to good deals. Language can be a tough barrier to over come. I’m still a long way from being fluent but can get by well enough. 

Friday 31st sounds good to me for a meet up. 

Hey @Mark C. we did rent to some older tenants when we also lived there and it worked pretty well. It’s less common to have that kind of living arrangement in Portugal than say London, where most people live like that. Perhaps there’s more of a market for that these days though with Porto becoming more international. 

Pre corona the house could earn between 2800-3500 per month renting room by room. Right now though, lots of airbnb places are offering rentals instead so the prices have dropped drastically and there’s lots on offer. I imagine this will change though soon. I spoke to the bank the other day and they said if I loan 300k against the property then I would have repayments of 1070 per month, so it stays cash flow positive. 

It’d be great to meet up if you come to Porto and have a chat about this. Like I say I’m only recently really starting to take property investment seriously so it’d be good to hear what someone with more experience has to say. Plus I might be able to help you understand the Portuguese market a bit more. 

Hey Tyrone, thanks for responding. The house is completely paid for so we have no outgoings in terms of mortgages. Running the airbnb through a company means you have to pay the company director a wage of at least 600 per month and an accountant 200 per month, plus a few other bills. The shop pays out only 400 per month at the moment. It could earn closer to 600 if we rented again, although that's not certain since corona. So currently the building is costing us money but of that some of it is a wage that is coming back to us. I have a job that also pays pretty well so there's no urgency to sell to get out if that's your concern. 

Hey guys. It’s my first time on the bigger pockets forums and I’m looking for some advice on my next investment move. Sorry for the long description but this needs some explaining.

I’m English but moved to Porto in Portugal about 6 years ago and bought my first house with my girlfriend. We paid €160k for a property in the centre of town which has 5 double bedrooms and 2 single rooms, plus a shop at the bottom of the building. We initially house hacked and lived there with tenants but over time Porto became popular with tourists so we bought another small house, moved out, and rented the whole house on airbnb.

Corona virus has meant that airbnb has dried up completely. I’m sure tourism will be back but this experience has just further cemented some things that we already were thinking about.

A - airbnb is a lot of boring work (cleaning, waiting for guests to arrive, etc) and is seasonal.

B - the house we have is only really useful for renting to groups on airbnb or renting as a shared house for students or younger people. The layout and shape of the building don’t really suit much else.

C - houses of that sized have probably increased in price as much as they will whilst smaller houses seem to have more room for growth.

D - Smaller houses are probably more liquid assets than bigger ones.

E - the house is now worth something like €550k but selling fees and capital gains will cost about €110k.

F - having €550k tied up in an asset that has an income of €50k a year before tax (which is quite high here), before expenses and takes quite a lot of work to run, might not be the best use of that money.

So really I want to know what other people would do in this situation. I could remortgage the house and use that money to get into some other smaller properties but that would leave us still owning the original house. We could try to rent that out to a family maybe but as I said it probably not the best use for it.

The other consideration is whether it’s a good time to buy or should I wait and see if prices drop with with economy.

Also, the Porto property increase is caused by tourism. The economy in general isn’t especially strong here. So that is a bit of a worry if tourism is permanently effected then property must drop in value.

There's a lot to consider so I'd love to hear what those of you with more experience think about this.