Returning to UK

[ramot]

We have rented out property in UK for about 18 years while living overseas, and still do.

Touch wood we have never had a problem, we have always had full management, and for us has been well worth it.

Obviously we have been in it for the long term, so properties with a mortgage have paid for them selves and all have increased in value. Never been empty for more than a few days.

We did keep a small 2 bed terrace empty for ourselves, as I spent a lot of time back in UK while our youngest was still in boarding school.

We also thought that we would return to UK for visits between tenants, but somehow that never seemed convenient, and also it didn't seem to make sense to ask a good tenant to leave.

 

I don't know enough about the current market conditions eg. getting a mortgage etc. to give any advice, and we are in a different tax situation as all our income comes from UK.

 

We go to UK most years for about 3 months, have found renting for less than 6 months previously very difficult, but Airbnb has changed all that.

 

We actually have finally arranged a house swap for next year, has been impossible previously to find anywhere near our son and grandchildren, but also going to see if anyone needs a house sitter for the few extra weeks, otherwise back to Airbnb.

 

The only other thing I will mention is that it can be a bit disrupting living between 2 countries for 6 months in 2 properties which is why we accept we will rent when we go to UK and limit the time, and keep one house as our main home, I spent 10 years feeling I never quite lived in either country,

 

Good luck with your plans Keith and Linda, no chance your family lives near Bristol and we could help each other !!?

[Keith and Linda]

We have rented out property in UK for about 18 years while living overseas, and still do.

Touch wood we have never had a problem, we have always had full management, and for us has been well worth it.

Obviously we have been in it for the long term, so properties with a mortgage have paid for them selves and all have increased in value. Never been empty for more than a few days.

We did keep a small 2 bed terrace empty for ourselves, as I spent a lot of time back in UK while our youngest was still in boarding school.

We also thought that we would return to UK for visits between tenants, but somehow that never seemed convenient, and also it didn't seem to make sense to ask a good tenant to leave.

 

I don't know enough about the current market conditions eg. getting a mortgage etc. to give any advice, and we are in a different tax situation as all our income comes from UK.

 

We go to UK most years for about 3 months, have found renting for less than 6 months previously very difficult, but Airbnb has changed all that.

 

We actually have finally arranged a house swap for next year, has been impossible previously to find anywhere near our son and grandchildren, but also going to see if anyone needs a house sitter for the few extra weeks, otherwise back to Airbnb.

 

The only other thing I will mention is that it can be a bit disrupting living between 2 countries for 6 months in 2 properties which is why we accept we will rent when we go to UK and limit the time, and keep one house as our main home, I spent 10 years feeling I never quite lived in either country,

 

Good luck with your plans Keith and Linda, no chance your family lives near Bristol and we could help each other !!?

 

Yep ramot we will be in the west country in Calne Nr Chippenham. Though not ruling your suggestion out, Bristol is probably too far away as Linda, having missed out on so much of the grandkids to date, would like to pick them up from school have them call in whenever etc etc. Also to see her mother more often and other family and friends a little more easier too.

I am pretty certain Linda would not like airbnb, reasons as previously said and would also include having to haul clothing etc. back and forth, too and through between countries and houses.

[Keith and Linda]

Just looked at airbnb, worked out that for a 6 month stay in a 2 bed house would at best be some (pounds) 8,000. Now having my own house would that cost me 8 grand a year to keep? I see rates, utility bills, and maintenance as being the major costs, though maintenance I when there or my UK son can do. So what I am thinking is that if I can holiday let it to cover rates and standing charges for utilities, then I hope to be at negative costs to me. A little simplistic I know as there are other things to consider like possible interest on the money not used to purchase, but this can be off set by any appreciation in house value over the years. At the moment I am erring on the side of purchase and if it does not work out after say 2-3 years then I can always sell, maybe for a profit even, if a loss then Linda will be plying the streets again!

[Marisawright]

Just looked at airbnb, worked out that for a 6 month stay in a 2 bed house would at best be some (pounds) 8,000. Now having my own house would that cost me 8 grand a year to keep? I see rates, utility bills, and maintenance as being the major costs, though maintenance I when there or my UK son can do. So what I am thinking is that if I can holiday let it to cover rates and standing charges for utilities, then I hope to be at negative costs to me. A little simplistic I know as there are other things to consider like possible interest on the money not used to purchase, but this can be off set by any appreciation in house value over the years. At the moment I am erring on the side of purchase and if it does not work out after say 2-3 years then I can always sell, maybe for a profit even, if a loss then Linda will be plying the streets again!

 

 

Although you'll have to maintain two lots of furniture, appliances etc, with two homes you'll be able to split all the miscellaneous stuff we all keep, so will you really need two HOUSES? It would be more practical to have an apartment at the Australian end - much less maintenance, neighbours will notice if a pipe leaks or there's a fire (even if they're not helpful, it's likely to affect them so they will act!), less obvious that it's empty so less likely to get burgled etc.

[Keith and Linda]

Although you'll have to maintain two lots of furniture, appliances etc, with two homes you'll be able to split all the miscellaneous stuff we all keep, so will you really need two HOUSES? It would be more practical to have an apartment at the Australian end - much less maintenance, neighbours will notice if a pipe leaks or there's a fire (even if they're not helpful, it's likely to affect them so they will act!), less obvious that it's empty so less likely to get burgled etc.

 

Yep! security is in our minds and influenced where we bought in oz when we downsized, did look at units but a house came up which ticked all the box's and a couple more, UK plays a bigger worry for us, again looked at flats but garaging for the car prove bothersome but still not ruled out. regarding furnishing etc. however as we will be travelling around the uk and Europe (subject to Visa's hey!) these will be kept basic but comfortable with some of the more, lets say valuable goods stored at family/friends. Also as we travel back and forth each year we can take some homely things with us then.

But as you intimate the whole thing still has a little worry/concern to it, but then again that's life! with nothing ventured nothing gained so to speak, can always be put down to life's experiences if things don't work as hoped and I think of it as spending the kids inheritance anyhow!

[flag of convenience]

My experience of renting out a property overseas I have used as a warning to others many times but the ATO is very generous to landlords so owning a house in Australia and renting it out probably is worthwhile - ultimately if it's empty there is no question that it will cost you money & an empty property is a risk, it only takes a loose tile or a burst pipe to go undetected for months and you can be talking serious repair bills.

 

If you rent it out then there are many expenses, including depreciation that can be written off against tax and most people end up paying no tax at all - in fact I found owning a rental property in the UK reduced my Australian tax from employment.

 

In the end you can only pay tax on profit which means you are getting 70% of 'something' and probably closer to 90% when allowances are taken into account.

 

The HMRC is not so generous - there is no negative gearing and recently they have stopped mortgage interest being considered an expense (not sure if that is in yet) plus my experience as a landlord in the UK and a tenant in Australia is that the law very much favours the tenant in the UK and the landlord in Australia. I wouldn't recommend renting out a house in the UK, except as a holiday let (Airbnb maybe) whilst you're overseas especially if you plan to come and go though.

 

I'd be tempted to own a house in the UK and a motor home in Australia but it would work the other way around too - or maybe do house swaps?? It's getting much more sophisticated these days and you don't have to do direct swaps - Love Home Swap is one I looked into. You offer your home whilst it's empty and get points which you can then trade to stay in someone else's - you can of course still do direct swaps.

 

I never heard the ATO being labelled generous before. Australia is certainly not a land that favours the tenant. I whole heartily agree but don't agree with the policy. A tenant who feels they have a stake in the property, rather just having a roof over their head, will supposedly take better care of the premises. Besides I feel the law needs to change in Australia with renting now a reality for life of an ever increasing number of people.

 

I must look into this home swap malarkey. I've been tempted but never done anything about it to date.

[flag of convenience]

They are mad, IMO. I have rented out several properties and if your property is in a good location and you have a good agent who is fussy about who they rent to, there's no reason why you should have problems. Anyone can be unlucky but it's pretty silly to avoid renting altogether, just because you're scared of a bad tenant. There is such a thing as landlord's insurance!

 

Like I said, if you don't make a profit on renting out your property then you won't pay any tax at all. It's ridiculous to suggest that rates, water and repairs wouldn't be covered by the rent, most people are able to cover all those plus a substantial mortgage payment with the rental income.

 

Consider, if the OP owns a substantial home in Australia it will cost them several thousands of dollars in agent's fees to sell it, and several thousands of dollars in stamp duty should they decide to return and have to buy another home.

 

Mad or not, overseas buyers, especially Chinese prefer to maintain the house as brand new by keeping it empty. Yield is so low in many cases, hardly worth the effort, besides can flip in a few years at perceived profit, still in pristine condition.

[Petals]

Mad or not, overseas buyers, especially Chinese prefer to maintain the house as brand new by keeping it empty. Yield is so low in many cases, hardly worth the effort, besides can flip in a few years at perceived profit, still in pristine condition.

 

Well a bank will not lend unless a property is insured and if no-one is living in the policy insurance companies are not keen to insure property. That is the problem these days with holiday homes, hard to get insurance on them. So the owners who leave them vacant must have the cash or else they are running the risk of the policy not covering the house.

[flag of convenience]

Well a bank will not lend unless a property is insured and if no-one is living in the policy insurance companies are not keen to insure property. That is the problem these days with holiday homes, hard to get insurance on them. So the owners who leave them vacant must have the cash or else they are running the risk of the policy not covering the house.

 

I think the sort of buyers being spoken about have little concern about that. Property laundering being of more concern. Applies equally to central locations to London, as it does to Australian localities.