Guest Rickard Family Posted September 20, 2008 Share Posted September 20, 2008 6 months ago i thought we would be going to Oz with at least £60k now the house prices have dropped we have excepted an offer £90k less than what it was valued for in January. So for the time being i will be working just to pay of a loan, tax bill and saving towards our journey to Oz. If we sell our house now, which we have been advised by estate agents and mortgage advisors would be our best offer for a long time, we probably wont have saved enough money to go until 2010. We could probably scrape through on money september next year but with no money for back up. Should we sell our house now or ride it out for 2 years until hopefully house worth more, which would not be fair to our oldest son.(1 of 4 Kids). Cant afford to rent it mortgage is to much to be covered by rent. If ifell straight into a job and had 6 months rent behind us could we afford to do it. Some people have said the cost of living in Oz is cheaper than UK others have said the opposite, whats the truth. When we started this adventure it was like a dream coming true, overnight the housing market has turned it in to a night mare. Can anyone give us reassurance we can move over with nothing :sad:or better still a good joinery or carpentry job on the Gold Coast. Link to comment Share on other sites More sharing options...
Guest Posted September 20, 2008 Share Posted September 20, 2008 My heart goes out to you, are situation is not far off yours - we had an offer of £210K for our house, our outstanding mortage is £209K. We didn't accept it but we're now faced with renting it out with the rent covering about half the mortgage. Fopr similar reasons (our son will go into P1 in February in Oz) we're going for it anyway. One thing to consider is rent in Australia is cheap relative to buying a house there so yes we'll be paying half the mortgage in the UK but rent (if we're modest in our aspirations) will be about half our mortgage too so it'll even out. Any 'loss' you make between rent & mortgage is tax deductible in Oz so don't rule out that option. Where our situation is different is we have jobs to go to, I would surely have thought with your skills that would be fairly easy to achieve though? Don't give up on your dreams (& yes ours feel like nightmares too sometimes) remember this is a world wide problem and house prices are dropping in Oz too, I keep telling myself 2 years from now we'll be wondering why we stressedso much as we crack open anouther stubbie Link to comment Share on other sites More sharing options...
Guest Rickard Family Posted September 20, 2008 Share Posted September 20, 2008 My heart goes out to you, are situation is not far off yours - we had an offer of £210K for our house, our outstanding mortage is £209K. We didn't accept it but we're now faced with renting it out with the rent covering about half the mortgage. Fopr similar reasons (our son will go into P1 in February in Oz) we're going for it anyway. One thing to consider is rent in Australia is cheap relative to buying a house there so yes we'll be paying half the mortgage in the UK but rent (if we're modest in our aspirations) will be about half our mortgage too so it'll even out. Any 'loss' you make between rent & mortgage is tax deductible in Oz so don't rule out that option. Where our situation is different is we have jobs to go to, I would surely have thought with your skills that would be fairly easy to achieve though? Don't give up on your dreams (& yes ours feel like nightmares too sometimes) remember this is a world wide problem and house prices are dropping in Oz too, I keep telling myself 2 years from now we'll be wondering why we stressedso much as we crack open anouther stubbie Thank you for your message. It is nice to know we are not alone, cant stop worrying we are making the right choices. Have you been to Oz before, thats the worry we dont even no what to expect. If we were to rent our house like you and fell short on English mortgage £200 a month are you saying it is tax deductable in Oz.:err: Link to comment Share on other sites More sharing options...
Quoll Posted September 20, 2008 Share Posted September 20, 2008 Thank you for your message. It is nice to know we are not alone, cant stop worrying we are making the right choices. Have you been to Oz before, thats the worry we dont even no what to expect. If we were to rent our house like you and fell short on English mortgage £200 a month are you saying it is tax deductable in Oz.:err: Check out negative gearing for how to claim against a rental property - however there could be some traps because as soon as you sell it I think you could be up for capital gains tax because it wouldnt be your primary home - check that out as well because it is rather complicated. Try here Negative gearing (Australia - Wikipedia, the free encyclopedia) get financial advice before you do it though. I am assuming that an overseas property can be negatively geared - the idea behind it was to bolster the accommodation market in Aus so not sure that they would see negatively gearing against a property overseas would be appropriate. Link to comment Share on other sites More sharing options...
Guest Posted September 20, 2008 Share Posted September 20, 2008 Thank you for your message. It is nice to know we are not alone, cant stop worrying we are making the right choices. Have you been to Oz before, thats the worry we dont even no what to expect. If we were to rent our house like you and fell short on English mortgage £200 a month are you saying it is tax deductable in Oz.:err: We went out on a reccy, how much that actually helps is hard to say. We certainly found we'd be happy with a $300 a week rental (in Perth) & that we would eventually be able to buy a house in an area we'd be happy with. We found the cost of strawberries & ready made pumpkin pie (!) buy expensive but found most food we bought cheaper (there wasn't as much ready made stuff so that makes it cheaper for a start). Lots to do for free too. The Australian government have definitely just this year made losses on overseas rental properties deductible against tax due in Australia - there was a link to the official annoucement on this site but absolutely as the next poster said check it out with an Australian tax expert and there is the potential for CGT (I haven't fully checked this out yet but as we're going over on a 457 visa I think we'll be okay as we will not be Australian residents) Feel free to PM me if you'd like to discuss in more detail. Jules Link to comment Share on other sites More sharing options...
Guest alan_blue Posted September 20, 2008 Share Posted September 20, 2008 this is interesting as we are going to be renting our house out also. We will be renting at a loss and plan to sell it in 5 years after a new fixed term mortgage term in feb. can anyone get a definitive answer on the capital gains tax for us as im sure many will agree it depends what the amount is as it could suck up all your earnings in the 5 years perhaps? what a dilema!! Link to comment Share on other sites More sharing options...
Guest alan_blue Posted September 20, 2008 Share Posted September 20, 2008 I have emailed HMRC lets wait and see!! Link to comment Share on other sites More sharing options...
TheBrammies Posted September 20, 2008 Share Posted September 20, 2008 If your going in 2 years then definitely sell your house then you will get a better price and your mortgage will be slightly less im renting because i think the value will return in the next few years Link to comment Share on other sites More sharing options...
Guest Zagg Posted September 20, 2008 Share Posted September 20, 2008 From what I've read I think the cost of living averages out at about the same, although the value of the dollar is going down so it's slowly getting cheaper to live in Oz (comparatively), although you might be earning less? I'm seriously not sure that the market will have recovered at all in 2 years, so if you've got a fair offer now then I'd go for it. If it really is your dream then hopefully you can find a way to make it work. Link to comment Share on other sites More sharing options...
KIRK AND CO Posted September 21, 2008 Share Posted September 21, 2008 6 months ago i thought we would be going to Oz with at least £60k now the house prices have dropped we have excepted an offer £90k less than what it was valued for in January. So for the time being i will be working just to pay of a loan, tax bill and saving towards our journey to Oz. If we sell our house now, which we have been advised by estate agents and mortgage advisors would be our best offer for a long time, we probably wont have saved enough money to go until 2010. We could probably scrape through on money september next year but with no money for back up. Should we sell our house now or ride it out for 2 years until hopefully house worth more, which would not be fair to our oldest son.(1 of 4 Kids). Cant afford to rent it mortgage is to much to be covered by rent. If ifell straight into a job and had 6 months rent behind us could we afford to do it. Some people have said the cost of living in Oz is cheaper than UK others have said the opposite, whats the truth. When we started this adventure it was like a dream coming true, overnight the housing market has turned it in to a night mare. Can anyone give us reassurance we can move over with nothing :sad:or better still a good joinery or carpentry job on the Gold Coast. Think & think again I have done this over & over again as I will not go unless I am sure my family are looked after. I have a lump sum to take over 75,000 Plus renting house( £900) very small morgage(£250) compared to house value(£250,000) & this is the only reason I have carryed on. I would go on my own with nougthing but my children come first its there future not mine. Good luck in what you decide just do it for your kids future just THINK Link to comment Share on other sites More sharing options...
Quoll Posted September 21, 2008 Share Posted September 21, 2008 From what I've read I think the cost of living averages out at about the same, although the value of the dollar is going down so it's slowly getting cheaper to live in Oz (comparatively), although you might be earning less? That unfortunately only works if you are earning in pounds but spending in dollars. Otherwise if you are earning in dollars the cost of living is going up - quite as much as it is in UK with the prospect of the drought hitting the fresh produce market quite significantly in the not too distant future if yesterday's news report was anything to go by. Australian salaries are generally lower on a direct pound/dollar comparison although there will be folk on here who tell you that they are earning comparatively more. The lower dollar is good for Australia's exports in the world market but it is absolutely cr*p for anyone wanting to take an overseas holiday - they get further and further out of reach the lower it goes unfortunately. Link to comment Share on other sites More sharing options...
Guest Miss M x Posted September 21, 2008 Share Posted September 21, 2008 Hi We're going over and starting again, we'll have no jobs, deposit for a mortgage or even furniture for us it will be a completely new start and we're only going over with enough money to cover basic living for 3 mths and as we're going on a student visa we will only have 2 part time wages coming in once we do find work, unfortunately the housing market put a stop to our original plans and has left us making next to nothing on our house but we're still going for it as the way we see it is it's now or never we're willing to give up what we have for a chance to start again and thats what part of the appeal of emigrating is to us, so you're not alone in going out with little money alot of people have done it and some will tell you they made it work some will tell you they didn't but for us it's worth the chance whether it works or not it will be an amazing experience Link to comment Share on other sites More sharing options...
TheBrammies Posted September 21, 2008 Share Posted September 21, 2008 its simple enough if you want it to work bad enough then you will find a way of making it work. Link to comment Share on other sites More sharing options...
Guest alan_blue Posted September 21, 2008 Share Posted September 21, 2008 im going accross with a salary of $54k and only taking about £3k with us, im sure that each and everyone will find their own way of coping on money side of things. Link to comment Share on other sites More sharing options...
Guest Posted September 21, 2008 Share Posted September 21, 2008 this is interesting as we are going to be renting our house out also. We will be renting at a loss and plan to sell it in 5 years after a new fixed term mortgage term in feb. can anyone get a definitive answer on the capital gains tax for us as im sure many will agree it depends what the amount is as it could suck up all your earnings in the 5 years perhaps? what a dilema!! Sorry no definite answer but some links that we can both look at and try and work it all out! Rent out your house and avoid Capital Gains Tax Suggests if you once lived in the house and rent it out for less than 6 years no CGT Capital gains tax - Wikipedia, the free encyclopedia Suggests that it is not a separate tax but part of the income tax system (so it'd be taxed at whatever rate you're on - ouch!) but it is only on the difference between what it was worth when you stopped living in it & what it is worth when you sell it & I don't think anyone is expecting a housing boom in the next couple of years! I need (for this an other reasons) an Australian Tax expert so if I find out a definitive answer I'll let post again. I could be wrong but I don't think the UK tax office will be able to help as the CGT is charged in Australia. Jules Link to comment Share on other sites More sharing options...
Guest Posted September 21, 2008 Share Posted September 21, 2008 Ooh just found this post on here http://www.pomsinoz.com/forum/money-finance/29838-tax-question-renting-uk-property.html Even more sure there won't be CGT to pay (so long as you don't buy in Oz) Link to comment Share on other sites More sharing options...
Guest Posted September 21, 2008 Share Posted September 21, 2008 Sorry another quick update, this has been posted before but here's a link to the info about rental losses being tax deductible Go Matilda - Your Gateway to Australia - News Think I'll be calling Alan tomorrow, I know he is always very helpful on here. Jules Link to comment Share on other sites More sharing options...
Guest Kate Posted September 24, 2008 Share Posted September 24, 2008 6Some people have said the cost of living in Oz is cheaper than UK others have said the opposite, whats the truth. When we started this adventure it was like a dream coming true, overnight the housing market has turned it in to a night mare. Can anyone give us reassurance we can move over with nothing :sad:or better still a good joinery or carpentry job on the Gold Coast. Hey! Cost of living depends on what you buy, so what is cheap for one person may not be for another. How about putting a spreadsheet together showing your current expenses, then doing some online research in Oz shops to see what you would need to spend there? Personally, I'm not sure how a family can really move with nothing. Different maybe, if you are on your own or just a couple with both working. But with kids? Have you costed the removal of your household contents and the cost of replacing those items that you can't/don't want to ship, including cars? Sounds like you are taking a huge hit on your house sale too, which doesn't make sense, even in this market. Maybe waiting another couple of years wouldn't be the end of the world for your eldest. Financial disaster would be far tougher on the whole family. Good luck with your decision. If it were mine, I'd defer!! Sorry to disappoint but I've lived in Oz and it isn't the land of easy living that many dream of. The grass may be greener, but it's just as hard to cut. Link to comment Share on other sites More sharing options...
Guest alan_blue Posted September 26, 2008 Share Posted September 26, 2008 I got a reply from HMRC re CGT and they said that if you are counted as a non resident for 5+ years and sell, you do not pay CGT. If you sell before this then you will be Link to comment Share on other sites More sharing options...
Guest beermeister Posted September 27, 2008 Share Posted September 27, 2008 One thing to consider is rent in Australia is cheap relative to buying a house I don't think I can agree on this. By way of example, my Australian house is valued at $700K and currently rents for $450 per week (450 x 52 / 700,000 = 3.34%). My UK house is valued at £230,000 and should rent for £675 per month (675 x 12 / 220,000 = 3.52%). Going on this example, my Australian house rents out 5% cheaper than my UK house - wouldn't call this much of a difference. Maybe my houses are an anomally, but looking at house rentals from an investment point of view, there really can't be much difference unless the base cash rate between the 2 countries is wildly different (i.e. why would Australians rent their house out much cheaper when they would be better selling up and putting the money in the bank?). Link to comment Share on other sites More sharing options...
Guest Posted September 27, 2008 Share Posted September 27, 2008 I don't think I can agree on this.By way of example, my Australian house is valued at $700K and currently rents for $450 per week (450 x 52 / 700,000 = 3.34%). My UK house is valued at £230,000 and should rent for £675 per month (675 x 12 / 220,000 = 3.52%). Going on this example, my Australian house rents out 5% cheaper than my UK house - wouldn't call this much of a difference. Maybe my houses are an anomally, but looking at house rentals from an investment point of view, there really can't be much difference unless the base cash rate between the 2 countries is wildly different (i.e. why would Australians rent their house out much cheaper when they would be better selling up and putting the money in the bank?). We're not in Australia yet so maybe I am wrong but on our reccy we were looking at rentals around $320 a week & to buy a similar house ($500K) would cost us over $4000 a month (over 20 years - we're old LOL) I wasn't comparing UK to Australia, I was comparing renting in Australia to buying in Australia - in fact I had asked myself the same question, why would 'buy to let' be a popular option in Australia - maybe there are cheap mortgage deals I haven't found yet - I do hope so! Jules Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.