Thinking of buying our US house
 

We've been happily based in Charlotte for 18 months, and now seem eligible for a mortgage. Monthly costs to own the house seem quite a bit less than our rent of $2,300 so thinking of buying the house we're renting - the owners are happy to sell and avoiding real estate agents saves quite a bit on the transaction.


My reservation has to do with the tax implications of one day selling the house once we've moved back to the UK.


Is the liability solely capital gains, and at what rate would that be applied?


I have a green card on the way, so would the tax liability be affected by whether or not I still have the green card when living in the UK and the house is sold?


Thanks for any words of wisdom...


ojg

Re: Thinking of buying our US house
 

any gain under $250k single, $500k married, is free of capital gains for primary residence.

Re: Thinking of buying our US house
 

The chances of you making enough of a gain on a house in Charlotte, NC to be taxable beyound the $500,000 tax free amount (assuming you're a married couple) any time in the next 20-30 years is approximately zero. FWIW the CGT rate is now 20%, but you can deduct any capital expenditures such as extensions and enhancements - porches, decks, etc.

NC real estate doesn't appreciate much, and it took the past six years for our home to appreciate back to what we paid for it in 2003, after the slump between 2006 and 2010. :(

Statistically we're past due for another recession, which will almost certainly knock prices back a bit again. A rise in interest rates would have a similar effect even without a recession.

Re: Thinking of buying our US house
 

Not sure what type of place Gastonia, NC is, but house seem to be priced in smarties. They seem really cheap.

Re: Thinking of buying our US house
 

There IS a reason, trust me! :rofl:

Everyone within 100 miles of the place knows that Gastonia is, even by the modest standards of NC, an incredibly "hick", backward place.

A local radio station has a jingle about a "town" named Belmont, which in truth is just a suburb of Gastonia, which goes, to the tune of "One Night in Bangkok" by Murray Head, "One night in Belmont and your girlfriend's pregnant ...." :rofl:

Re: Thinking of buying our US house
 

It is not the sort of place you'd want to live in. I'd rather drive around Gastonia than go through it on my way to Asheville. It's a dump.

Re: Thinking of buying our US house
 

FIFY :nod:

It is, indeed, a dump - always in the news locally for shootings, drag racing on the main thoroughfare, and other such trashy goings on. This week, in a suburb on the other side from Belmont, a man has been arrested for faking the abduction of his girlfriend's three year old daughter, killing her by "blunt fore trauma", and partially concealing the body in nearby woods. Gastonia is that sort of area. :(

Re: Thinking of buying our US house
 

The type of place horror movies are based upon.

Re: Thinking of buying our US house
 

At least you've got Hamrick's!!!!!

Re: Thinking of buying our US house
 

Something like the notorious X-Files episode entitled "Home", yeah. :nod: