liverpool girl

We are currently trying to decide whether to rent the house out or sell. We were going to just rent it out since we didn't have time to sell what with having to find a buyer and then getting stuck in a chain etc as we have to be in Sydney by end of June. However, a friend of ours over the road has a friend who is interested in buying the property and after their second viewing yesterday, I think they may well go for it (no chain or anything involved and best of all no estate agent fees!). The problem is that we are only initially planning on going to Sydney for 3 to 4 years and are nervous about getting off the UK property ladder but on the other hand I don't want the hassle of renting out a UK property. We would have no plans to return to Liverpool even if we did return to the UK. We have thought that if we do end up selling it may be worth buying somewhere in Sydney. Could anyone out there tell me what costs are incurred in buying and also selling a property in Sydney ie Stamp duty rate, average Estate Agent percentage etc. If these costs are too high we may well consider hanging onto the UK house and putting up with the hassle of renting.

Thanks to all who reply.

Wendy

Hi

No idea on the costs in Oz, but have you thought about putting the money into an ISA or high interest savings account. Just a thought

liverpool girl

Hi, yes we have thought about investing the money, but I think we would taxed on any earnings made from our investment. Is that correct? Would we be taxed under UK tax laws (we would keep the money in sterling) or would we be taxed in Australia (we are going on a 457 visa) in which case I presume it would be at 47%. Could someone please let me know if I've this all wrong.

Thanks

martinw01908

Is renting hassle? If you rent, surely your costs will be lower especially when you move back. You will have no house to sell, just up and move! Anyway, as far as I can see, the property market in Aus is like ours, overvalued and prices actually dropping. I know I won't be buying there in a hurry.
I would only buy if I was sure i was going to stay there and once I have a feel for all the neighbourhoods.

On one hand you could keep your UK house, the income may be very handy for you. And if prices hold up here you are ok. On the other hand our economy is not as hot and it was and our house prices may go down as well, so you might be just be better off selling it while you can a good price for it.

Tax wise, as far as I knew you won't be UK Capital Gains taxed on your asset if its your only UK property. Then you can take the money with you to Aus as an existing asset and you won't be taxed on it at all from what I understand.

I'm not 100% sure though so somebody else please come and chime in about the tax situation.

stubbyholder

this calculator might help for stamp duty on buying. hope it helps http://yahoo.infochoice.com.au/banki...stamp-duty.asp
S

ABCDiamond

These were my buying costs for a NSW house 4 years ago:

Rates adjustment $127.25
Water adjustment $57.83
Solicitors Fees $925.50
Government Stamp Duty $7,614.00
Mortgage Stamp Duty $680.00
Registration and other fees $310.25
Pest Inspection $121.00
Building Inspection $176.00

Total $10,011.83

If you are an Australian First Home Buyer, then you pay NO stamp duty on a property under $500,000

If that had applied to me at the time, then the costs would now only be $2,400.

No fees are paid by the buyer, to a Real Estate Agent.

stevemich

Hi
We are here on a 457 and buying properties on that visa type are severely restricted.
You have to get some form of special permission to buy, as technically if your sponsorhip is revoked you would have to leave the country in 28 days (if I remember correctly).
We decided to sell our UK place as the possibility of our house being empty at any point (and therefore us paying mortgage)whilst paying rent out here would have crippled us in the space of a few weeks!
Plus also we needed the money for buying car, additional furniture, rental bonds etc.
If you can afford it, I would recommend keeping your place back there... gives you that backup. You can always sell it if you decide to stay here permanently.
Steve

Budgie

But lots of fees are paid by the SELLER to a Real Estate Agent.

Think at least double what you pay in the U.K i.e. 2.5% instead of 1.25% agency fees, plus that doesn't even pay for the advertising in papers etc - you have to pay for that as an extra. Bargain!

ABCDiamond

We sold a house recently and paid 2.5% + GST, but that did include all advertising.
On all the houses we have sold here, we have never paid any advertising costs. However, all Real Estate agents tend to tell you that the competition DO charge for Advertising

Selling houses in the UK is definately cheaper.

liverpool girl

Hi, thanks for all your help. I really think that it would be foolish to buy in Sydney unless we were planning on staying there for the forseeable future which is not the case at the moment. We could end up losing tens of thousands of pounds in the process and have more stress to go with it (buying and selling property). At least if we rent in Oz we can pretty much pack up and move on when we like. Stamp duty web site is fab, gave me a bit of a shock though - still better to find these things out now rather than later!!
Thanks again - you've certainly helped us reach a decision.

northerner

Interesting and useful thread!

By the looks of it if you buy in victoria you pay LOADS of stamp duty, buy in Sydney for less than $500,000 and pay nothing! I may be reading it wrong but it looks as though, compared to Melbourne, we could rent in Sydney for the first year then, assuming we want to buy after that, basically save the equivalent of the years rent in fees etc!

Well that's definitely made my mind up (was unsure between Sydney/Melbourne) - Sydney it is!

martinw01908

Does that mean that if you waited until you have citizenship, you qualify for the Australian first time buyer deal?

Another question, someone told me that if you sell property the agent does all the legal work for you so thats why they are more expensive. But you have no seperate solicitors fees. Is this true?

northerner

The NSW government website says permanent resident or citizen so as long as you've got an appropriate visa you qualify.

Graham

ABCDiamond

As said by "northerner" all Newly arrived PR's can currently get the first home buyer benefits, including the $7,000 grant

The agent does do most of the work, showing people round the house etc, but you do still need a conveyancer for the legal work. My legal costs on selling were $550

NickyC

Of course, that'll only work if you can find somewhere in Sydney for less than $500k that you'd be happy to live in....