SarahG

Husband and I are preparing to up sticks and leave the UK for Indiana late in the year on his H1B visa. (Still to schedule interview at Embassy but leaving that till after our summer vacation)

As the H1B is temporary and only for 3 years, or 6 if renewed, we are unsure what to do with our house in the UK. Should we sell it or rent it out? Ideally I would not want to return to the UK and hope that we can settle permanently in the US. (Employers have not ruled out the prospect of trying to adjust status and try to get permanent residency for us)

We have a bit of equity in our house and would make about £65,000 if we sold. If we were to adjust our mortgage to allow us to rent there are lots of hidden costs to pay and fees to letting agents etc. Any change in the mortgage would need to be based on husbands salary alone as I would not be allowed to work and would have no income. I say be done with it and sell up which would give us more money for US move. Husband is unsure as if we were to return to UK we would need to start over again on the housing ladder.

It is confusing and a tricky decision to make! So I would like to know what others in similar situations have done. Have you sold your UK property or rented it out? Any help/advice is greatly appreciated!

rebs

It is a tricky decision to make isn't it?

I guess a lot depends on your own particular circumstances - how you feel about your UK house, what the market conditions are like in your area for both selling and renting.

We moved here a year ago on an inter company transfer. When we first heard about the move, I was adamant that we should sell our house - I felt that it would be so much hassle to rent out. It's an older house with it's quirks and foibles and I was convinced that we would have endless issues with maintainance and it would be difficult to deal with from so far away.

In the end we did rent - and now I'm really glad we did. The management company we use are a bit flakey at times but generally do a good job.

The main reason I'm glad that we rented, not sold, is that I now feel very relaxed about whether we go back to the UK or stay here. If my husband were to come home today and say we were being repatriated, that would be fine - I would go back to my house in the UK (which we love!) and be happy to do so.

What might help would be to get a few agents round, both for selling and renting, then maybe you could get an idea of what things are like in your area?

Good luck with the move!

Giantaxe

Only if house prices appreciated in the UK significantly during your absence.

Burn1911

When we first came over here 5 years ago we rented our house out. Our mortgage co. just needed to approve it in writing every year and everything else stayed the same. We put it with an agent who managed it all for us and it was always rented out.

Then when we got our green cards, and decided a move back to the UK was not in the imminent future we decided to sell and brought a house over here.

We were lucky though as it was just before the housing market crashed so we sold at just the right time! if the timing had not been right we may well have just continued to rent it out and rent over here!

It was so nice to finally be moved to one place, for a long time I felt very divided as to where my home was, we lived here but my house and all my stuff was over there! it is a weird feeling!

MsElui

we didnt know if we would like it here when we left the UK. (oe whether firm would go for sponsoring us for a GC). So in order to keep a foothold in the Uk property market we rented ours out. We had to go for a Buy to let mortgage and the interest only one kept the payments below the likely rental.

we use a letting agancy and they take care of it all. We did have to do some renovations to make it suitable to let before we left - and have had to do a few repairs etc but its been fine.

as it happens we like it here and are in the green card process now. however the uk housing market has tanked so we would likely not sell it even if we wanted to. Additionally our current discounted rate means that for the past 3 months our mortgage payment has been zero! Ridiculous i know and it might bite us in tax later on - but the discount ends in a few months so we are going to see where that ends up. If we could get a fixed repayment mortgage under the rental amount we would take it like a shot as it would be a nice savings vehicle in effect.

fatbrit

Since nobody's mentioned it, watch out for US CGT liability if you become PRs.

Jerseygirl

We kept our house in the UK for 3 years before selling it...we didn't rent it out. We sold in '99...the housing market had been at a standstill for several years and had just started to pick up. I regret selling...last year we bought a much smaller house for twice the price.

Have you lived in the US before...if not how do you know you will not want to return home?

SarahG

Is that Capital Gains tax?

I have lived in US before. I lived in Michigan for a while. Loved every second and only came back a my exchange period was ending.

Bob

I'd hang on to it...it's a gamble with capital gains if you get greencards, but till you get closer to the stability of getting them, I'd not sell.

You'd be borked if you flogged it and then got laid off...

Cape Blue

I live in the US and rent out UK property.

(1). What is the (interest only) mortgage going to be in relation to likely post-agent rent income? agents will take 10-15% (+VAT!) for full management. they will also try and stiff you and the tenant for contract fees etc.

(2). Take into account extra insurance (lettings ins) and 10% wear & tear/corgi etc pa - you will end up replacing boilers, carpets etc over a period.

(3). Assume 11 months rental pa for planning purposes

(4). Furnished or unfurnished? (does furnishing meet fire regs)

(5). Agents by their nature are useless - any agent who is good (if that is not a contradiction in terms) works on the sales side and those on the lettings are mostly dufi (what is the plural of dufus?)

(6). Will you be able to sell your house in the next 12-18 months? will you end up having to swallow a 40k drop to sell and 'lose' most of your 65k equity?

(7). What is the rental market like in your area - the agent will always tell you its good, what do you see online, are places staying open for rent for a long time?

(8). If you do move back the UK property could be cheaper - but you still have the transaction costs of selling and buying again to cover.

Couple of thoughts to get you going.

It works for me, but I used to rent out places before I moved to the US and consider I could move back at some point.

SarahG

Thanks so much everyone for your advice and sharing your experiences. I don't think we would have much problem renting it out. We live directly opposite our sons primary school which was the most popular in the town for people trying to get their kids into this year. The head teacher told us that when we went for a 'new parents' meeting as our daughter should start there in September. She won't be though if we move to the US then! I am just about getting over the guilt I was feeling when we were told we were very lucky at getting our child in this year as there are a few dozen parents who are appealing as their child was not accepted!

Property prices are holding steady where we are and I was looking at what some houses have sold for in our neighbourhood. From what we bought it for a few years ago we would sell it for around the same mark. I guess it would be sensible to hang onto it and rent out just in case the worst case scenario happened and husband was laid off and we needed to return to UK. Just got to hope we can sort out a suitable mortgage adjustment!

fatbrit

Yep -- there's a large exception for your main residence. But not for a rental.