Renting or Sell property when leaving UK?

SouthOfTheBorder

Hi, I was hoping for some advice regarding whether we should think of renting our house if we can't sell our home or just keep dropping the price until it sells.

6 months ago I had a baby and we also bought our first home. At the time my husband and I obviously thought we were doing the right thing but since then I am really homesick and want to leave the UK as we have no family or friends here so no support.

I personally would just be happy to take the hit on the house to sell it and go home whereas my husband doesn't want to loose any money so if we couldn't sell it for what we paid then he'd want to rent it out. I have had an EA over to look at it and he said he'd be happy to put it on the market for what price we paid for it. Whether we were able to sell it for that though would be another thing...:)

We are both aware that even if we could sell it for what we paid there are other fees and that's fine. I just would like opinions on whether people on this site think it's better for us to rent it or just keep dropping the price until it sells. We would be moving to Australia which is why I'm not keen to rent it - too far away.

We are in London and although we don't believe we paid too much for the house (we were able to get 10k off the asking price) I think prices are still dropping whereas my husband (always the optimist!) believes they're not.

Please go easy on me - hindsight is a wonderful thing! (plus I blame the pregnancy hormones on the urge to have to buy 6 months ago!)

Many thanks

BitterAndTwisted

Just sell up for whatever you can get for it and go.

climbgirl

Just to play devil's advocate a bit - are you really sure you want to leave? 6 months to settle into a new country is not a long time. Speaking from experience, it took me well over a year before I felt properly settled in the UK. And that took a LOT of work getting myself out and meeting new people. It's exhausting at first, but the effort is worth it in the long run.

Add a new baby into that mix (and all the ensuing tiredness, hormones and post-natal depression) and you may be making a decision that you'll regret in the future, especially if you decide to take a financial hit on the house.

hazyjo

Not sure all mortgage providers offer mortgages on houses which have been owned by the previous owners for less than one year. Not sure if that's a blanket rule, or whether it applies to some lenders. Worth bearing in mind/looking into...

Jx

BitterAndTwisted

I can't think of anything worse than being responsible for a property and being thousands and thousands of miles away. Plus, whatever rent is collected will need to have tax deducted before you see any of it.

lincroft1710

If you delay going, one of two things will happen, you'll either accept the current situation or become more depressed and homesick, especially as autumn and winter are on the horizon. Third thing will probably be further (but small) house price fall.

If you are determined to return to Australia and stay there, absolutely no point in keeping house over here and renting it out.

Caveat_Mortgagor

One of the reasons the property market in the SE has performed better than the rest of the country over the last few years is because the weakening pound made uk property more attractive to overseas buyers. And those o/s buyers flock to london and surrounding areas.

However, anyone that did buy will have seen the continued weakening of the pound make it harder financially to sell and convert back to their own currency

The Aus Dollar is now stronger against the pound than when you bought.

Much of your decision will be based on whether you had a big deposit and what rate of exchange you got.

The Pound has lost about 15% of its value against the US dollar in the last 12 months.

If for example you had AUSD175k last Aug you would have got £100K for them.

To convert back to AUSD175 would now need £116k.

So, even if you got back everything you paid in pounds sterling, your potential losses will be affected by how much was borrowed and how much was converted from AUSD when you bought.

SouthOfTheBorder

thanks for all the replies, definitely some things to think about. We have been in the UK for a while, and have lived O/S for quiet a while. The reason I think for the homesickness now is having a baby, having no support and my little one missing out on family being around (my husband is from Europe but no family in UK).

I didn't know that about the mortgage re less than a year... will have to look into that. But I think even if put it on the market now it wouldn't sell for a while anyway.

Thanks again everyone.

sioban_2

I am in a similar situation to yourselves - have had visa approved for Oz and need to be there by April 2012 but don't know whether to sell or rent out our house. If we sell then will be lucky to break even after fees - and our profit from our deposit won't go far in Australia due to poor exchange rate. If we rent out we should make some money which would potentially be used for any repairs/maintenance and hopefully eventually house would increase in value and exchange rate may improve, but it could turn into a disaster trying to manage rental from Australia.

I have 2 kids and also think it would give us a safety blanket of being able to return if we do feel homesick. I love Australia and the quality of life but am also very worried about taking kids away from family and friends.

missile

It can be quite stressful renting, more so when you are in a foreign country. You may think the will do all the work and you just count the profit, but it never works out like that. Believe me been there done that.

It is time to enjoy your new family at home. The last thing you need is more stress and I would suggest you advertise at a realistic price and sell at whatever you can achieve.

Prices are rising where I live, but not so in most locations. There is a huge variation accross London.

SouthOfTheBorder

Hi Sioban, I think in your situation I wouldn't be selling, if we were coming to the UK from Aus then I'd hang onto my home (as you say, just in case you don't settle). And the exchange rate is pretty crap so no real incentive there either....

Thanks again everyone for your replies. I do think we will try to sell now instead of renting our house out.