Relying on rental income to help pay the residential mortgage.

[Nando8039]

I'm looking to buy a property on madeira, as all my family live there and I've had enough of the UK. I will move to madeira and get a lower local job and also benefit from €800 monthly rental income from a family property. I would have around €20,000 in savings. The local job and rental income would leave €400 spare every month. I'm a dual British and portuguese national and my mortgage from the portuguese bank has been approved. Good idea relying on rental income? The madeira job wouldn't cover the mortgage and monthly expenses.

The rental landscape is changing with new legislation after April 1st, making it much more expensive and difficult to evict a bad tenant who knows how to manipulate the system. You could be stuck for a year or more trying to rid yourself of someone who does not pay the rent. Even if you rent out the property via a letting agent many of them are very poor. If they make mistakes you as the landlord are legally responsible. Landlording is not for amateurs.

It's unclear in which country the rental will be?

Very much depends on the kind of Tenant that you get and the kind of Landlord you’re going to be. People are panicking unnecessarily about the Rental law changes in my opinion.
If you’re up-to-date with your paperwork can you send your right to rent documentation? You get your gas certificates done every year and your contract is reasonable and compliant. They shouldn’t be any issues.
However
What you won’t be able to do is hike the rent every one or two years which plenty of landlords have got into the habit of?
You won’t be able to throw them out when it suits you unless it is to sell the house
Personally I think if you can discipline yourself to just put the money from the sale of the UK property into an income generating fund you can use up your isa and your husband’s Isa to get tax-free income generated that way
It would definitely be a lot less hassle

Laws in Portugal and the U.K. are different.
where is the rental and how much would you need to do with it?

Is the potential rental in UK or abroad? If the former there are statutory obligations for landlords, new legislation in May, checks on renters to organise, Non Resident Landlord scheme for income tax plus CGT liability should you sell in future. You would need someone available to manage the property, an agent can charge 10% or more. If you need a mortgage for your new property in Madeira will the lender even take rental income into account as it can be unsteady and how would you cope if there were void periods paying bills as well as your own costs.

Have you factored in the income tax on the rental income?