doodlediver

Hi all, Newbie here.
I have the opportunity to work, teaching, in Jeddah on a 2 year contract.
I just wanted to know if there are any expats who has rented their house, in the UK?

Thanks

rebs

Welcome to BE

Loads of people have rented out their houses - if you have a bit of a search around you should find plenty of threads.

My husband & I rented out our house a few years ago while we were in the US for a couple of years.

Our experience was a mixed bag - we used a local agent (cost 10% of rental income) who were OK. Had the same tenants for the whole 2 years we were away, so no rental voids. However, that was offset by the fact they hit hard times and stopped paying their rent so ended up owing us quite a bit.

No wilful damage by the tenants, but there was certainly loads more 'wear & tear' than I would have expected had we lived there for those 2 years.

A key thing to get done ahead of time is make sure you have permission from your mortgage provider (if you have a mortgage).

dunroving

I rented my house way back in mid-1980's - disaster (bad tenants), probably cost me several thousand pounds as I had to evict them and then the house was empty until I sold it quite a while later.

I also bought and rented out a BTL in the UK from 2004-2013 - disaster (two sets of bad tenants, pathetic agency, multiple major repairs and redecorated three times in 9 years).

However, I know others who have had better luck.

The #1 determinant of success/failure is getting good tenants and either a good letting agency or a very trusted friend or relative to keep an eye on things.

You need to look into whether your mortgage company will let you rent it out. They may require you to remortgage to a BTL-type mortgage.

If you decide not to rent (leave it empty), that may have implications for insurance. Even if you do rent it out, you'll want to switch to a landlord's insurance policy.

Even if you get good tenants, expect plenty of wear and tear. Most tenants don't take as good care of your house as you would.

You have to balance the benefits (rental income, security of having someone in the house) against negatives (hassle of sorting out the above, and the possibility of major hassles if you have bad tenants).

Anticipate having to redecorate the whole house when you move back, and how much that would cost against how much net rental income you would get.

If your tenant accidentally leaves the bath running and the whole ceiling falls through downstairs, all they have to say is they went away for a couple of day and "it was like that" when they came back. It's almost impossible to prove there was no leaky pipes (I know, from experience). I had that happen twice; once with each set of tenants. Kitchen ceiling had to be re-plastered twice, at my expense.

You might consider using spareroom.co.uk and renting out rooms (so you would be an owner/"occupier" and they would be lodgers). Rental income may not be much less than renting out the whole house, but I think you would have greater rights and of course could use the extra bedroom when you come back.

holly_1948

My sister does.

Her advice:
Some agents are a lot better than others.
Go to whatever lengths it takes to track down and speak with other one house (or commonly one flat) landlords. Ask everyone you know to ask everyone they know to find those landlords.
It makes all the difference and it is thousands and thousands of pounds cheaper to fix ahead of time than to repair afterwards.
And when you do get a good tenant who takes care of the place and pays on time, for goodness sake never raise the rent on them, ever.

feelbritish

We did, best thing we ever did. First rented out furnished but had bad tenants with house shares etc, then removed the furniture except white goods and rented to families through an agent and have had no problem, our tenant has been there now for 7 years and the house since we left 12 years ago has doubled in value and now it has become our main investment for our retirement. I think it also depends where you have your house, ours is in a very desirable town in the Home Counties with excellent schools and near enough for Oxford although not for daily commute to uni. Also excellent links to London for work.

Editha

We bought a house in Devon last year and are renting it out for a year. We have an agent recommended by someone on this forum, and one of the neighbours is keeping an eye on things for us too.

The cost savings on renting over leaving a house empty are enormous. Empty house insurance is about twice the price of insurance for a tenanted property. Plus you have to pay council tax for an empty property, but if you have tenants they pay it. Our tenants would have to do thousands of pounds worth of (somehow uninsured) damage before we were worse off.

dunroving

Believe me, it's possible, and insurance won't necessarily cover it.

There are lots of good reasons to rent out while overseas, and as long as people are aware of the negative outcomes and are willing to take the risk, it may be worth it.

not2old

We have been successful BTL'ers (to families) as well as slumlords (only to student & welfare tenants) strictly for the cash flow not for appreciation reasons. Always with minimum exposure.

For a short period we were buying fix to flip properties. All quite the experience. BTL's any day over renting your own castle when living away unable to monitor or watch it. Trust no one, sell the asset to make use of the cash. Cash is king/queen.

Englishmum

There is a wealth of information here (although I think mostly aimed at the serious Buy To Let landlords) about renting out a property, letting contracts, how to evict problem tenants legally etc:

http://www.landlordzone.co.uk/forums/

We've had the same tenants for 12 years (maybe longer?). They always pay rent on time via an Estate Agent (12.5% commission each month, not that they do much to justify it) - we charge them less than the market rate - and I actually think we will have a problem getting them out when we will eventually need to move back in! We thought we might be moving back 5 years ago and when we told the tenants we wouldn't be renewing the tenancy they said that they couldn't find anywhere where the rent was as reasonable in the local area so would apply to go on the council housing list! Lucky for them we ended up staying overseas.(More info on evictions - see below)

We don't really want to move back into the house as we moved overseas 19 years ago and have no local connections (it's in a commuter village in south west Essex, my spouse worked in London) but I understand that otherwise we would have to pay Capital Gains Tax if we sold it before moving back into it.

I've read on a number of forums/blogs about tenants having to move out when the landlord wants their property back; it seems to be the case that some tenants can't (or won't?) find alternative homes to rent and present themselves to the local council as being homeless as it is still seen to be less expensive to rent a council property than from a private landlord and once you get a council house you can keep it indefinitely.

The trouble is of course is that so many council properties have been sold off so there are very few left and the waiting lists are enormous. The only way to get a higher priority on the list is to be considered as homeless. However, the councils will only accept them on the council housing list (we all know how long they are) as homeless if the tenant has been formally evicted from their current property. It can take weeks for a 'Section 8' or 'Section 21' to go through the courts and in most cases by this stage the tenants stop paying rent (from what I understand the eviction procedures through the courts won't even start to take place until the tenancy is 8 weeks and 1 day in arrears)......if applying for a council place I guess they aren't too bothered about getting a good reference from their current landlord either.....anyway plenty of anecdotes on the Landlordzone forums on the link I posted above.

Editha

Dunrovin,
I reckon we are approximately £7,000 better off than if we'd left it empty for a year. What exactly do you think tenants could do which would cost that much to repair?

Admittedly, I'm not bothered about the decor and carpets, since we intend to renew them anyway.

dunroving

If you are netting £600 per month, then is it safe to assume you are mortgage free? If so, that is a whole different kettle of fish. If not, you must have a large house that you have owned for a long time, therefore a small mortgage. Again, a different kettle of fish from most people.

Over 9 years owning a BTL, I sold it last year for a loss of £40,000 over the 9 years. About £15,000 of this was due to a drop in value, the rest was due largely due to property maintenance, repair of tenant damage, unpaid rent, empty periods.

For someone whose house is mortgage free or has a small mortgage relative to the house's value (i.e., has owned it for a long time or put a lot of capital into the purchase), renting probably makes good sense instead of leaving it empty. However, another stategy could be to sell the house in this situation and invest the money while away.

The latter runs the risk of house prices going up, but that isn't going to happen in the same way it did between the late 90's and mid-2000s.

Bud the Wiser

You have to take the emotional side out of the equation and replace it with pure financial benefits. If you're going to get upset because a tenant hasn't looked after the place, don't do it. It's not worth the stress. If however, you want to cover your overheads including spending £'x' to get the place back up to how you left it then it could be to your advantage.

Professional BTL'ers, have no emotional attachment to their property.

Editha

Yes, you are right. We don't have a mortgage. However, if the OP doesn't want to sell while he is away for two years, then renting is still a better option than leaving it empty IMO, and in the opinion of actuaries also, since the insurance will be cheaper.

Selling is the other option, but a lot of hassle for just a two year absence, and it is risky with house-prices going up at the moment.

Bud the Wiser

House prices going up, or down, is another consideration.

dunroving

When doing the sums, the OP should look at mortgage interest only as "cost", as the rest of his mortgage payments will be paying off capital.

My annual interest is about £1,500 and annual council tax about £1,000, house insurance about £200. That's less than £3,000 true "cost" per year.

I think if I were to disappear for two yers I'd let 2 of my bedrooms using spareroom.co.uk, which would easily cover my costs, give me somewhere to live and store my stuff (inc. car) for visits home, and I think makes for more responsible tenants.