leaving UK, but want to keep property here - advice please !

seven-day-weekend

We moved to Spain two years ago and still have our housr in the UK. It is lived in by our son and two lodgers and the lodgers' rents pay most of the bills and my son pays the rest.

We kept it for several reasons:

1. It's our son's home too and we didn't really see why we should chuck him out.

2. We knew that if we ever wanted to come back, we'd never get on the property market again. It's no good just keeping the money if house prices are rising quickly, you'll soon be priced out and as we are now retired (but not State Pension age) we wouldn't be able to add to the savings.

3. It's somewhere for us to stay when we're in the UK, even if we do have to sleep on an airbed on the floor because the bedrooms are taken up with lodgers.

4. We're quite attached to the old place.

We're lucky in that we have got our son to live in it and he acts as unofficial agent. I'm hoping that if he ever gets a wife/partner they will BOTH want to live there.

I agree with another poster about paying voluntary contributions towards your State Pension, because even if you never return to the UK, you can have your pension whichever country you live in.

SamC_4

I recently sold to emigrate so I'm biased but keep in mind:

1. Without wanting to start the whole house price argument, you really have to have a lot of faith in the UK market to think that keeping a house there will be a good long-term investment starting at today's prices.

2. You are exposing yourself to a lot of exchange rate risk; the value of your house in your new country's currency will rise and fall with the exchange rate and the variations can be quite wild. If you may need the money from the house at any point you could be forced to sell it when the exchange rate is bad (e.g. it could be 30% worse than it is now).

3. The combination of exchange rate risk and housing market risk is even worse; if the housing market fell and the exchange rate fell along with it, which it would tend to do in a housing-led recession, you could lose even more of your house's value (again only if you actually needed to sell it).

seven-day-weekend

SamC wrote:

I recently sold to emigrate so I'm biased but keep in mind:

1. Without wanting to start the whole house price argument, you really have to have a lot of faith in the UK market to think that keeping a house there will be a good long-term investment starting at today's prices.

2. You are exposing yourself to a lot of exchange rate risk; the value of your house in your new country's currency will rise and fall with the exchange rate and the variations can be quite wild. If you may need the money from the house at any point you could be forced to sell it when the exchange rate is bad (e.g. it could be 30% worse than it is now).

3. The combination of exchange rate risk and housing market risk is even worse; if the housing market fell and the exchange rate fell along with it, which it would tend to do in a housing-led recession, you could lose even more of your house's value (again only if you actually needed to sell it).

But I think as you say, that these things only apply if you want to sell the property; if you want to keep it as a base in your home country, then it doesn't matter what the exchange rate is.

I think the OP, although they were talking of rentals, actually wants to keep property in the UK as a safety net in case living abroad doesn't work out for whatever reason, and therefore presumably they won't be selling.

SamC_4

seven-day-weekend wrote:

But I think as you say, that these things only apply if you want to sell the property; if you want to keep it as a base in your home country, then it doesn't matter what the exchange rate is.

I think the OP, although they were talking of rentals, actually wants to keep property in the UK as a safety net in case living abroad doesn't work out for whatever reason, and therefore presumably they won't be selling.

Sure, but I got the impression they thought it would be a safe and worthwhile investment so I think it's important to consider what could happen to its value. Plans do change and if, heaven forbid, something goes wrong while they are overseas they could be forced to sell when the exchange rate and the housing market are against them.

ailuro2

I knew someone who sold their own house, used some of the money to emigrate and bought a one-bedroomed flat.

Even using an agency they couldn't get the rent money but felt guilty they were giving the renter a hard time because she had a yound baby. Eventually after about six months of no rent they had to revert to asking someone here at home to go see the girl and explain they really needed the income from the flat, but she got another six months rent free before they got rid of the flat and swore off doing the same thing.

seven-day-weekend

SamC wrote:

Sure, but I got the impression they thought it would be a safe and worthwhile investment so I think it's important to consider what could happen to its value. Plans do change and if, heaven forbid, something goes wrong while they are overseas they could be forced to sell when the exchange rate and the housing market are against them.

Fair enough.