Your property queries answered...

How long does it take to buy and sell in Dublin?

What sort of time frame is it reasonable to budget for when selling and then buying a house in Dublin. We hope to move in the spring - putting our house on the market at the end of January and househunting at the same time. Is there any way we can estimate how long we will need to get bridging finance for?

What you are really asking is what's going to happen in the property market in early 2007. And, as you will have noticed in all those previews of the year in the newspapers over Christmas, everybody - from economists and bankers to estate agents - can't say for sure.

This time two years ago if you had asked the same question you could have been fairly confident of selling a well-located Dublin house in less than six weeks, but as many housesellers discovered in the second half of 2006, that time frame no longer applied. What is certain is that with more interest rate hikes predicted, as well as increases in utilities (electricity increased by 12 per cent on January 1st and gas bills are due to rise by 24 per cent in February), housebuyers are going to be more realistic when it comes to how much they can afford.

The market will move, and move quickly, if house sellers are equally realistic about the price they hope to get. If you have started the process of shopping around for an estate agent to sell your house, you will know that all agents are encouraging sellers to be realistic about their expectations.

How do I handle rent from room that's over tax-free threshold?

I bought an apartment last March and it will be completed in January. My figures for affording this purchase are based on renting a room but interest rate increases mean that already my mortgage has gone up by €180 per month. Passing this on to my tenant will push my earnings from the room over the tax-free threshold. How do I handle this in terms of the taxman?

The rent-a-room scheme allows owner-occupiers to earn up to €7,620 from renting a room out. It's not just the rent that is included in that figure - it includes all payments from the tenant including, for example, all contributions towards light, laundry, and so on. Once the payments exceed €7,620, the rent-a-room scheme no longer applies and all income is liable for assessment for tax and must be declared in your tax returns. (You must also declare that you are renting a room but once the earnings are at, or under, the rent-a-room threshold, they are exempt.)

Of more concern is your assumption that you will simply be able to pass on your interest rate increases to your tenant. Maybe you will - a room in a penthouse will probably rent out for more than €600 per month anyway - but you don't say where your apartment is located so it's difficult to assess your chances of getting more rent than you originally budgeted for.

The house share section on www.myhome.ie is a good source for assessing the market rate. As many new investors who entered the market in the past two years have discovered to their cost, unless the purchase involved a substantial deposit, rental income now rarely covers the full cost of mortgage repayments.

Send your queries to Property Questions, The Irish Times, The Irish Times Building, 24-28 Tara Street, Dublin 2 or email propertyquestions@irish-times.ie.

Unfortunately, it is not possible to respond to all questions. The above is a representative sample of queries received. This column is a readers' service and is not intended to replace professional advice. No individual correspondence will be entered into.