Rent or Sell?

Old May 15th 2012, 3:01 pm
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Hi

The visas have arrived and they've been stamped.... we have 4 years to go to Aus but would like to go next year.... problem is we have a house to sell....

In this climate the housing market isn't looking too great unless you sell for a cheap price.... there is the option of renting but i'm not sure what to do for the best.

What expereinces have people had renting there house while on the other side of the world? What are the pros and cons that you have come across....

This is all new to me....

Advise would be much appreciated
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Old May 15th 2012, 4:58 pm
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Default Re: Rent or Sell?

Hey BonnieH,

I have no experience or renting a property and so I can’t help you there.

If you rent your home in the UK would you then be excluded from buying a home in Aus? How would this impact you not just financially but also emotionally?

Would the rental value of the property pay the UK mortgage?

What are the interest payments on the mortgage? If your mortgage is costing you £5K a year in interest on a £150K mortgage (obviously this is hypothetical as I don’t know your circumstances), house prices would have to rise more than 10% in the next three years before you break even, but if the rental income pays the mortgage fully and the property agent fees etc. I guess this isn't a problem.

It is hard to give any real advice without knowing all the details but my gut tells me that the house in the UK would feel like a ball and chain and that any financial gain in the short term would be minimal. But them my gut also told me to drink a lot of wine last night which my head regretted this morning; I therefore cannot vouch for the competency of my gut in administering good advice

Last edited by ScouseMan; May 15th 2012 at 5:00 pm.
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Old May 15th 2012, 7:37 pm
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Default Re: Rent or Sell?

Personally I chose to rent UK house out rather than realise a big loss and bring money over at a rubbish exchange rate. Have to be happy with renting here if choosing this option, well most will anyway. We reckon without selling we would need to save until end of 2014 to get a deposit together to buy where we want, which is Sydney northern beaches, so an expensive area.

Renting the house out has been uneventful and relatively pain free with full management service provided. Have had more "maintenance repairs" in the period it has been rented than we ever had but I suppose it means it is being looked after. You have to see it as a business, not your home, if we ever go back we will redecorate from top to bottom to make it ours again.
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Old May 15th 2012, 9:20 pm
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Default Re: Rent or Sell?

Another of the classics. House prices in the UK aren't going up for a long time in fact the worst of the house price falls may be just around the corner. I sold mine last year before coming because imo nothing is more likely to make you feel miserable in Australia than owning a depreciating asset 10000 miles away
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Old May 15th 2012, 10:52 pm
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Default Re: Rent or Sell?

Originally Posted by bingobob777
Another of the classics. House prices in the UK aren't going up for a long time in fact the worst of the house price falls may be just around the corner. I sold mine last year before coming because imo nothing is more likely to make you feel miserable in Australia than owning a depreciating asset 10000 miles away
What is a "classic"?
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Old May 16th 2012, 12:21 am
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Default Re: Rent or Sell?

I rent my house out in the UK. I did consider selling it before I left, but for me the numbers stacked up better for renting. I got a really good mortgage deal with a long (10 year) period of consent to let (not a buy to let mortgage which would have been more expensive on the interest payments) and the rent payments and service fees for a fully managed service covered my mortgage payments plus some extra for contingency, so it was a no-brainer.

Whether renting would work for you would depend on your circumstances though, and I would advise you discuss this through very carefully with local estate agents and mortgage brokers so you can work out whether renting would be best - also need to take into consideration whether you need the cash that you may make from the sale to help with your move to Australia. Renting property does come with significant costs, such as management fees, set up costs (certifications for safety, electric and gas etc), also need to consider periods where you may not have a tenant, and how you are going to cover the mortgage payments during those times. Maintenance costs can also be high and you'll probably be surprised how much stuff needs repairing once you leave..

From a practical point of view, it did concern me how I was going to deal with a rental property from the other side of the world. I carefully vetted all the local rental agents, spoke to landlords and tenants from them for references, and negotiated hard on management fees (they will tell you that they can't - they definitely can). I also chose a deal with my agent whereby they guarantee the rent - if there is a period where they cannot find a tenant, they still pay me the rent in full. This gives me peace of mind. I have an agent I am very happy with, I have happy tenants, and see it as a long-term investment. It is working well for me.
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Old May 16th 2012, 12:33 am
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Default Re: Rent or Sell?

Originally Posted by Bermudashorts
What is a "classic"?
A thread where the same people repeat the same arguements over and over.

Sell rent
economies
house prices

etc etc
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Old May 16th 2012, 1:33 am
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Default Re: Rent or Sell?

Originally Posted by Bermudashorts
Personally I chose to rent UK house out rather than realise a big loss and bring money over at a rubbish exchange rate. Have to be happy with renting here if choosing this option, well most will anyway. We reckon without selling we would need to save until end of 2014 to get a deposit together to buy where we want, which is Sydney northern beaches, so an expensive area.

Renting the house out has been uneventful and relatively pain free with full management service provided. Have had more "maintenance repairs" in the period it has been rented than we ever had but I suppose it means it is being looked after. You have to see it as a business, not your home, if we ever go back we will redecorate from top to bottom to make it ours again.
+1

Same reasons, forget it being your house and think of it as a business investment until you have another decision to make about selling it if you need capital or to lose the mortgage.

Too expensive for us to buy here where we WANT to live, so we rent. Possibility in the future of selling our UK home and using any capital released from that to buy here as an investment in a good rental area, which may not be an area we would pick to live in...if that all makes sense!
Short answer, rent where you WANT to live and buy where you can AFFORD to buy but they will be two separate areas!!
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Old May 16th 2012, 1:35 am
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Default Re: Rent or Sell?

Originally Posted by LittleButton
I rent my house out in the UK. I did consider selling it before I left, but for me the numbers stacked up better for renting. I got a really good mortgage deal with a long (10 year) period of consent to let (not a buy to let mortgage which would have been more expensive on the interest payments) and the rent payments and service fees for a fully managed service covered my mortgage payments plus some extra for contingency, so it was a no-brainer.

Whether renting would work for you would depend on your circumstances though, and I would advise you discuss this through very carefully with local estate agents and mortgage brokers so you can work out whether renting would be best - also need to take into consideration whether you need the cash that you may make from the sale to help with your move to Australia. Renting property does come with significant costs, such as management fees, set up costs (certifications for safety, electric and gas etc), also need to consider periods where you may not have a tenant, and how you are going to cover the mortgage payments during those times. Maintenance costs can also be high and you'll probably be surprised how much stuff needs repairing once you leave..

From a practical point of view, it did concern me how I was going to deal with a rental property from the other side of the world. I carefully vetted all the local rental agents, spoke to landlords and tenants from them for references, and negotiated hard on management fees (they will tell you that they can't - they definitely can). I also chose a deal with my agent whereby they guarantee the rent - if there is a period where they cannot find a tenant, they still pay me the rent in full. This gives me peace of mind. I have an agent I am very happy with, I have happy tenants, and see it as a long-term investment. It is working well for me.
wow....sounds like a great deal there!!! We are good with ours but not THAT good!
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Old May 16th 2012, 4:22 am
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Default Re: Rent or Sell?

Originally Posted by BonnieH
Hi

The visas have arrived and they've been stamped.... we have 4 years to go to Aus but would like to go next year.... problem is we have a house to sell....

In this climate the housing market isn't looking too great unless you sell for a cheap price.... there is the option of renting but i'm not sure what to do for the best.

What expereinces have people had renting there house while on the other side of the world? What are the pros and cons that you have come across....

This is all new to me....

Advise would be much appreciated
Much will depend on your personal circumstances..... Have you been to Oz before?

If things do not work out, you have a base to return to if you rent it out....works for some, but for others it will be too tempting to jump back on a plane if the going gets tough and wont stick at it long enough.

We rented our UK home for a few years and eventually sold to buy here.
Renting the UK property was good and with such a small mortgage gave us extra income. The house prices here are so high, we just couldn't afford to buy without selling the UK property.

Went from a $97,500 mortgage in the UK to a $370,000 mortgage in Australia....Haven't yet figured how I will pay it before I retire.
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Old May 16th 2012, 6:37 am
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Default Re: Rent or Sell?

Originally Posted by h2oskineil
Much will depend on your personal circumstances..... Have you been to Oz before?

If things do not work out, you have a base to return to if you rent it out....works for some, but for others it will be too tempting to jump back on a plane if the going gets tough and wont stick at it long enough.

We rented our UK home for a few years and eventually sold to buy here.
Renting the UK property was good and with such a small mortgage gave us extra income. The house prices here are so high, we just couldn't afford to buy without selling the UK property.

Went from a $97,500 mortgage in the UK to a $370,000 mortgage in Australia....Haven't yet figured how I will pay it before I retire.
wow...I DREAM of only a 370k mortgage in Sydney area....wouldn't get me a shed in the decent areas!!
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Old May 16th 2012, 8:25 am
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Talking Re: Rent or Sell?

Originally Posted by LittleButton
I rent my house out in the UK. I did consider selling it before I left, but for me the numbers stacked up better for renting. I got a really good mortgage deal with a long (10 year) period of consent to let (not a buy to let mortgage which would have been more expensive on the interest payments) and the rent payments and service fees for a fully managed service covered my mortgage payments plus some extra for contingency, so it was a no-brainer.

Whether renting would work for you would depend on your circumstances though, and I would advise you discuss this through very carefully with local estate agents and mortgage brokers so you can work out whether renting would be best - also need to take into consideration whether you need the cash that you may make from the sale to help with your move to Australia. Renting property does come with significant costs, such as management fees, set up costs (certifications for safety, electric and gas etc), also need to consider periods where you may not have a tenant, and how you are going to cover the mortgage payments during those times. Maintenance costs can also be high and you'll probably be surprised how much stuff needs repairing once you leave..

From a practical point of view, it did concern me how I was going to deal with a rental property from the other side of the world. I carefully vetted all the local rental agents, spoke to landlords and tenants from them for references, and negotiated hard on management fees (they will tell you that they can't - they definitely can). I also chose a deal with my agent whereby they guarantee the rent - if there is a period where they cannot find a tenant, they still pay me the rent in full. This gives me peace of mind. I have an agent I am very happy with, I have happy tenants, and see it as a long-term investment. It is working well for me.

Thanks everyone for your comments, I suppose everyones situation is different. We've been to Oz a few times now and have family over there and have had mortgage meetings so we know that we can still buy a property over there and still have property in uk....

Unfortunatly we bought our house in 2007 just before the crash so we are not in a great position to sell and make a fortune, the decision is do we cut our losses and sell for a rubbish price or rent the property out until the market picks up....

Like I said in the previous post it's the worry of moving away and having no control of the property. We have no intention of coming back to the UK so the thought of having a property back here wouldn't sway me to return however its the worry of that email or that phone call to say your property needs this repairing and that repairing..... our house has been renovated to a high standard so i'd hope that for the first few years at least it would be still in that condition, i'd like to think tenants would treat the property as if it was there own but that is not always the case.

I suppose the main thing to do is get the pros and cons of renting and if all the hassle is worth it, you hear of so many horror stories that it kind of puts you off...... so thanks for the people who commented who have been or are in that situation.

I wish I never bloomin bought a house now!! lol
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Old May 16th 2012, 11:43 am
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Default Re: Rent or Sell?

Originally Posted by BonnieH
Thanks everyone for your comments, I suppose everyones situation is different. We've been to Oz a few times now and have family over there and have had mortgage meetings so we know that we can still buy a property over there and still have property in uk....

Unfortunatly we bought our house in 2007 just before the crash so we are not in a great position to sell and make a fortune, the decision is do we cut our losses and sell for a rubbish price or rent the property out until the market picks up....

Like I said in the previous post it's the worry of moving away and having no control of the property. We have no intention of coming back to the UK so the thought of having a property back here wouldn't sway me to return however its the worry of that email or that phone call to say your property needs this repairing and that repairing..... our house has been renovated to a high standard so i'd hope that for the first few years at least it would be still in that condition, i'd like to think tenants would treat the property as if it was there own but that is not always the case.

I suppose the main thing to do is get the pros and cons of renting and if all the hassle is worth it, you hear of so many horror stories that it kind of puts you off...... so thanks for the people who commented who have been or are in that situation.

I wish I never bloomin bought a house now!! lol
One thing I would look at is Landord insurance.

Should the tenant loose their job, become ill etc the rent will be paid until the tenant is out and you get a new tenant into the property.

http://www.letsure.co.uk/landlords/default.aspx This is who we used, great peace of mind when you are so far away.
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Old May 16th 2012, 11:56 am
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Default Re: Rent or Sell?

Originally Posted by BonnieH
Thanks everyone for your comments, I suppose everyones situation is different. We've been to Oz a few times now and have family over there and have had mortgage meetings so we know that we can still buy a property over there and still have property in uk....

Unfortunatly we bought our house in 2007 just before the crash so we are not in a great position to sell and make a fortune, the decision is do we cut our losses and sell for a rubbish price or rent the property out until the market picks up....

Like I said in the previous post it's the worry of moving away and having no control of the property. We have no intention of coming back to the UK so the thought of having a property back here wouldn't sway me to return however its the worry of that email or that phone call to say your property needs this repairing and that repairing..... our house has been renovated to a high standard so i'd hope that for the first few years at least it would be still in that condition, i'd like to think tenants would treat the property as if it was there own but that is not always the case.

I suppose the main thing to do is get the pros and cons of renting and if all the hassle is worth it, you hear of so many horror stories that it kind of puts you off...... so thanks for the people who commented who have been or are in that situation.

I wish I never bloomin bought a house now!! lol
are you prepared to wait a decade?
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Old May 16th 2012, 12:43 pm
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Default Re: Rent or Sell?

Originally Posted by bingobob777
are you prepared to wait a decade?
LOL it's looking like that at the moment isn't it
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