The address: 26 The Mills, Castleknock, Dublin 15.

The agent: Berkeley & Associates.

The property: two-bed ground floor apartment for €395,000 which represents a cost of €7,182 per sq m (€667 per sq ft).

The look: modern rustic.

The features: a 55sq m (600sq ft) two-bed apartment with a lounge, wooden flooring, two windows, French doors to secluded grounds, a kitchen with modern fitted wall and floor presses and two bedrooms with fitted wardrobes. Electric heating.

How much for an investor? With stamp duty at 7.5 per cent and legal fees at 0.5 per cent, the acquisition cost is €427,015.

The annual repayments on a 90 per cent mortgage on a tracker rate of 3.85 per cent would be €25,515 (€2,126 per month). With an annual rental income of around €11,000 (taking into account one month's costs and one month's void), the shortfall would be €14,515 (€1,209 per month).

On an interest-only mortgage the repayments would be €13,687 (€1,140 per month), giving an annual shortfall of €2,687 (€223.91 per month). This represents a yield of 2.8 per cent.

To break even the purchaser could take out a 39 per cent mortgage at an AIB tracker rate of 3.7 per cent. The annual surplus on an interest-only mortgage at this rate would be €5,254 (€437.83 per month).

Potential: good rental area. A-two bed apartment in this area would get €1,100 per month rent.

Verdict: with substantial losses on the 90 per cent mortgage outlined above, this would probably only interest a cash-rich investor that could afford a considerable deposit on the property and to wait for long term capital appreciation.

Calculations by Simply Mortgages