Avid

You can come out here wholeheartedly but you still might want to leave after a few years. In the mid to long term I'd sell up in the UK and transfer the money over here (and I did indeed do that with one of my properties) but in the short term I'd rent the place out just in case......

Then again, as said earlier, the UK is a bubble waiting to burst (is everybody on this forum under 30? Am I the only one who remembers the last property collapse?) so you might want to sell quick....there's a lot of luck in the timing....

lapsed kiwi

I know what you mean about not selling, but my point is that by doing this, migrants are stacking the odds against themselves being happy in NZ. The equity you have accumulated in UK is far more use to you here, where money costs a lot, than providing a house for a tenant in UK

Avid

I see your point but it's swings and roundabouts.....I've read posts on this website were people came over to NZ/OZ with the best intentions in the world but didn't last a year..and it would have been easier for them if they had kept the house in the UK.

On the other hand, burning all the bridges can be a good way of staying focused and it does put money in the bank. Personally, if I was totally new to NZ and/or emmigration, I'd try and rent my UK property for a year just to play it safe.

It's not an easy one to answer....

AlbieLittle

I totally disagree with that. When you look at property why does it increase in value? Because land is scarce and is running out. In the UK the land is much scarcer than in NZ therefore property prices will be greater in the UK and will continue to rise to a level much greater than here in the NZ ,where things like migration still affect the property price level.

Rent out your property in England and use the stronger pound to subsidise your living in NZ. Also, if the bottom falls out of your move to NZ, then you have a safety net to fall back on.

lapsed kiwi

The flaw in your proposal is that renting property out in UK will give you very little return. I have approx £180k of equity in a property in UK worth about £300k and the rental income doesn't quite cover the mortgage and other expenses. If I brought that money to NZ, it would save me about $43k per year in mortgage interest (if I had a mortgage that large). Or it would pay off my mortgage and buy me a very nice yacht.

AlbieLittle

Depends what your property is. Like everything else there are good investors and poor ones. No offense but sounds like yours is a poor one. I saw a program on tv last year in england where a bloke bought at auction a property which needed renovating then put it back on the market the next day without doing jack shit to it, sold it for about 15,000 quid profit

lapsed kiwi

I didn't buy it as an investment or as a rental property, but as a home to live in! It has appreciated by around 50% in the 5 years I've owned it, so it has incidentally been quite a good investment. But, due to it being in a niche location, it's not the best rental property.

Fact is though, even if you get the best rental property in the UK, your net returns are unlikely to be more than 2-3%. This doesn't stack up against the 8-10% the money will cost you in NZ to buy a house.

AlbieLittle

Not following you on the net return thing. But if you look at the return on the house. 10% every year on a brit property outstrips 10% on a kiwi one.

lapsed kiwi

Well, lets say you have a house worth £250k. Let's say you get a net rental income (after agent's fees etc) of £800 per month. Take off £500 per year for insurance, another £300 for repairs etc. I'll ignore the need for new carpets and redecorating after five years of renting. Your income is 9600-800=£8800. As a percentage, this is 3.5%. Sure, it's probably good as a long term investment (which is why we kept ours) but in cash flow terms, and therefore for most people, quality of life in NZ, it sucks.