Bodgit

Greetings all, forgive me if this post is a repeated question.

Straight to the point - Is it better to sell a house and take the money to NZ or rent the house out and rent in NZ? Opinions invited.

I know this is dependent upon things like "Is NZ for the rest of our lives?" etc.

Option 1: Sell house, rent in NZ until sure it is for us, then buy there.
Option 2: Sell house, rent in NZ with view to buying straight away there regardless and hope for capital increase in NZ.
Option 3: Sell house, buy a couple of flats in UK and rent out. Rent in NZ.

Concerns:
tax implications though I believe with tax treaties, taxed once in UK means not taxed again in NZ,
exchange rate fluctuations,
getting money from NZ to UK,
Better to invest in property in NZ or UK?

I know no-one has a crystal ball but opinions are invited from all.

Thanks in advance.

Jeeper

Exhange rate at mo is about 20 or 30% less than it should be.....it is hurting converting into NZ dollers.
Without giving ideas on what to do with the money or house in UK i'd say better to keep the investment or cash there for a year or 2.

isv

Bodgit,

To be frank, here's my opinion:

Option 1: Sell house, rent in NZ until sure it is for us, then buy there.

This is absolutely the way to go. I would add that you should rent for at least a year (as the NZ property market might get interesting by then...) and by then the exchange rate should also be more in your favour.

Option 2: Sell house, rent in NZ with view to buying straight away there regardless and hope for capital increase in NZ.

Nope. You won't get much/any capital increase in UK or NZ - both property markets are floating on a sea of hope. Many will argue that you cannot lose money on NZ property... I disagree. You can lose money on any property in any country on the planet if you get your timing wrong. Right now you would be buying at the absolute top of the market.

Option 3: Sell house, buy a couple of flats in UK and rent out. Rent in NZ.

Christ no! The buy-to-let market is imploding in the UK as we speak. I could not think of any easier way to risk losing your capital than investing in flats.

Bodgit

Thanks for all that. We are leaning for option 2 at the moment mainly due to the exchange rate fluctuations and the realistic chance that we may not like it there.

Keep 'em coming...

isv

Did you really mean to say 'Option 2'... ? Surely if exchange rate fluctuations and a desire to try NZ out are a concern you'd go for '1' ???

silvermuse

whatever u do with ur house in the uk, it's a good idea to rent here first to see if u like the place where ur living and to see if nz is really the right place for you. i think the market is a bit flat here at the moment so if u did buy and decided ur werent happy for whatever reason, u might find it hard to sell. but thats just what my family and friends have experienced so good luck to u.

livewire

Probably the important thing is to ensure that you have your capital invested in property somewhere.

You'd have to weigh up the costs of a British v. NZ mortgage, taking into account the current exchange rates and the difference in interest charges between the two countries.

It's not an easy decision to make right now, and probably not one you should make based on the opinions made on an forum. I know some people who have property in both countries and just rent out the one they are not living in at a particular time.

cottageinthesky

Hi Bodgit - I've just joined the group - I sell real estate in Wellington, NZ - this article is interesting re exchange rates : http://www.nzherald.co.nz/section/st...ectID=10358792. It's not the best time to bring pounds sterling into NZ. However, if you do, you should be able to get a better rate than the spot rate for a lump sum through your receiving bank. Otherwise, investigate fixed term rates in the UK or, perhaps, hold the sum in an off-shore bank account which will pay interest until the exchange rate "turns". Whatever, take good professional advice.

It is useful to rent before you buy here - in Wellington, for instance, with so many steep hills as backdrops, some parts don't get any winter sun, so get really damp - there is always a dehumidifier sale at the start of winter! The sunny side is north - I nearly rented what I thought was a really cheap apartment with a big south facing deck until I remembered that south was not the sunny side. And then there's the wind - a prevailing northwesterly which can drive you mad in October/November when it sometimes blows for days - so I would always make sure I've got north and south facing outdoor areas to get away from it - when the southerly blows, there's nothing between NZ and the Antarctic, so anything facing south and exposed gets blasted every now and then. All these sorts of things you get to know with time, as well as what the various suburbs have to offer.

The property market in Wellington has changed over the last few weeks - be wary of general comments about the NZ property market - Wellington/Auckland are quite different, for example - in Wellington prices are surely going to slow, maybe quite dramatically - there has been a noticeable increase in investment/rental property being listed as investors start to liquidate property assets. Another reason why waiting to buy is probably a good thing - many vendors are now expecting too much for their property.

livewire

EVen within the property market demand and prices can fluctuate for different types of property - LSBs, farms, flats, houses. One can see an increase whilst another is dropping.

Jeeper

An intersting article that may help in your decision.

http://www.nzherald.co.nz/section/12...ectID=10358792

sky

If you can afford to I would keep your house in the UK and rent it out. Rent here and see how you like it for at least a year if not more.

BEVS

i am still waiting Sky.

Pompey_Paul

INMHO

Rent your house out in the UK and rent when you get to NZ especially with the exchange rate as it is now........you can always sell later....you may build up a nice little nest egg from the rent in the UK + Uk house price inflation!

Good luck

shortfatbloke

We've gone through the same thought processes as you have - we are considering option 3 as it leaves us without the worry of having a large mortgage in the UK and the stress of trying to sell a house from half way around the world if/when the money in NZ runs out. Working on the basis of the housing market increasing by about 5% over the next 12 months and having a two bed appartment rented out for about 10/12ths of the year, we estimate that we would still make more money than sticking it in a high interest account in NZ - especially with the exchange rates as they are now.

I don't think the exchange rates are going to get back to 'attractive' levels for another few years and it seems that the NZ economy (about which, I am the first to admit, I know very little) may be heading for a downturn.

We're also looking at a move to NZ as a 3 year project at the moment - if we get all the ticks in the right boxes then we'll stay, if not we will still have a step on the property ladder in the UK.

All I can do is wish you luck.

isv

'Cottage' - I just wanted to thank you for your honest opinion of the local NZ property market. It is so very refreshing to hear a real estate agent talking about the reality of the current property market!