Selling in London to buy in LA....?!
 

Hi everyone

Wanted to get some advice. We are on o1 visas and live in Santa Monica, CA. We are renting here, and we own a flat in north London which we rent out to our lovely tenant. Our tenant has now offered to buy our flat from us, it's worth about £650/700k. Personally I want to stay in California indefinitely so I'm all up for selling in London and buying here. My husband is unsure about selling and taking ourselves out of the London market. Has anyone done this, any tax implications of selling in London whilst we are abroad? Is it a good idea to buy in Santa Monica? (if we can afford!!!) Is it better to buy if we have green cards? Can we even buy while on work visas? What about this year being an election year, does that have any implications? I just need some opinions please!

Thank you
Lilly

Re: Selling in London to buy in LA....?!
 

I should say that we don't like our rental here at ALL and are looking to move anyway this summer to another place.

Re: Selling in London to buy in LA....?!
 

Re buying in CA, you can certainly buy a house, but I think the big question is do you want to sink your money into a place that you are one failed visa renewal away from not being able to reside in year round.

Re: Selling in London to buy in LA....?!
 

You can buy property in the US even if you are barred from entering the country, so yes, absolutely you can buy while here on a work visa. Whether it is sensible to do so is a whole other question! :lol:

Your visa might not be renewed, leaving you, at most, a few weeks to pack up and leave, so personally I wouldn't buy while here on a work visa.

The cost of buying and selling houses in the US is such that it is generally unwise, financially, to buy unless you can reasonably expect to live in the house for at least five years.

Re: Selling in London to buy in LA....?!
 

Hi there. I moved to LA 3 years ago and bought a house. Some things to that occur to me -

- Buying on a visa is definitely tricky. Can you get your husbands employers to get cracking on the EB1? If they won't, see if you can find another way to get on a green card track. It sounds like you guys should be in a good place to make that happen.

- There may be capital gains tax on the profit of your house sale if you have not lived in it long enough - Talking to an accountant is essential.

- It really comes down to if you think you will be in the US for the long haul. If so - it's maybe a good idea to cut the ties and get into the US market. LA seems to be scorching hot right now. We bought our house in Encino three years ago and Zillow appears to think it has appreciated by 20%. Personally I think that is ridiculous - maybe it's just a big bubble. I guess it depends on where you think your money is safest.

- Owning a home (as I am sure you know) is a killer financially. We spend more than we did when we were renting, for sure. Every little thing costs several grand. New boiler? $2K. Broken pool pump? $2K...etc... That said - we are in heaven having our own place in a lovely quiet neighborhood. I don't think I would ever have been able to afford a beautiful space like this in the London suburbs.

- The schools in LA are notoriously bad - you have to be careful where you purchase.

- Happy to chat more. Also in the trailer business!

Re: Selling in London to buy in LA....?!
 

How long have you been renting out the house in the UK?

Re: Selling in London to buy in LA....?!
 

As an owner of several rental properties I'd say that if you can keep your London property and still buy here in CA then do it. Perhaps you can refinance the London property and get enough for the downpayment here. Since mortgage rates are so low and you can deduct interest payments then it's worth having a large mortgage and keep getting rental income, since I assume you are getting a good return on that London property.

I love rental properties and the income that they generate.

Re: Selling in London to buy in LA....?!
 

You're forgetting the big ones - new roof likely $15,000-$20,000 which only lasts 15-20 years in most cases, and $10,000-$20,000 for a heating/AC system which only lasts 10-15 years.

In the US, homes are often a money pit that people from the UK find hard to believe. .... Painting my house is almost a continuous job, as the summer sun is tough on paint on the SE and SW sides.

Re: Selling in London to buy in LA....?!
 

Really? I live in Sacramento where 100 degree days are common and haven't experienced this on any of my houses. The tile roof on my main residence is nearly 40 years old and doing fine, 30 years old on another rental and the a/c units are good if you keep them maintained.

Re: Selling in London to buy in LA....?!
 

Tile and metal roofs, yes, but most houses in the US have asphalt shingle roofs.

Re: Selling in London to buy in LA....?!
 

I have the asphalt shingles on three houses.

Where do you live? Florida would be tougher with hurricanes but LA doesn't really have anything too severe like that. I expect they would have to buy EQ insurance though.

Re: Selling in London to buy in LA....?!
 

Most asphalt roofs are only warranted for 25 years, and many look like cräp long before that (the grit comes loose and washes off, algae and moss grows, the corners curl up in the heat, etc.), and are susceptible to wind damage long before the 25 years is up. You can now buy 35 year "architectural" shingles which are supposed to be good for 35 years. I am sceptical.

FWIW I am in-land on the east coast, but we get little wind here - the last hurricane-force winds were 28 years ago. ..... And I would never buy asphalt shingles - when my house needs a new roof it will be metal of some sort - probably grit-coated to to fit in with the preference for asphalt shingles of other houses in the area.

Re: Selling in London to buy in LA....?!
 

Sounds reasonable. One thing I would be wary of is any house with a flat roof. I've had nothing but problems with one of these on a rental.

Re: Selling in London to buy in LA....?!
 

Flat roofs are stupid. End of discussion! :lol:

BTW I was adding to my post above when you last posted.

Re: Selling in London to buy in LA....?!
 

Look into the tax aspect. You may well be subject to capital gains tax on the sale. If I recall correct,y if you have not lived in it within the past 2 or 3 years then you are liable for 20% capital gains on the profit.