Buy or Sell

Yvonnea

Just looking for advice.
Husband is from Sweden and has a business over there.
Thinking of moving there. But problem is he wants to sale and
I want to rent out our house in Kildare.
His reasoning to sell is that all the reports are saying that the house market while may not crash is in for "a soft landing".
And we could buy a house in Sweden for a fraction of the cost of our Irish property. Which would mean no mortgage.
I am just worried we would be priced out the market should we return in a couple of years.
Would we have to capital gains on renting house, even though we owned it for five years.
Any advice would be appreciated.

Sponge Bob

dunno , you DO seem to have all the facts so YOU must now decide yourself

also tax, no tax to pay if you sell now but the Swedes may tax you in 3 years if you sell then ??

iguana

I can see the attraction of buying a house mortgage free in Sweden, but to my mind it could limit your options of returning to Ireland in the future. If rental income will cover the mortgage, why not agree to rent the house for the first year and then review the situation in 10 months when you have a better idea if you could settle there.

The worst thing that could happen is that you sell your house here and buy one in Sweden, but once the dust settles realise you hate it there. My husband and I are considering a move to Canada in a couple of years, and we could afford a huge house there mortgage free with the equity on our London house. But there is no way we'd sell our London house before living in Canada long enough to know that we were happy to settle there for at least 20 years.

Zambia

I think you should just go , sell the house and go.

Keeping the house here will just stop you settling there...

The question should mpre be do you really want to live there, when your already thinking of your escape plan...?

best of luck

iguana

Zambia232 wrote:

The question should mpre be do you really want to live there, when your already thinking of your escape plan...?

Lots of people choose to live somewhere for a few years and then returning home or living elsewhere. I'm perfectly happy living in London right now but I really don't want to grow old and raise a family here.

FreeAnd..

sell, get out while you can. Avoid CGT once you sell within the year, avoid price drops if you manage to sell it now. Move to Sweden and enjoy your life without the hassle of a mortgage or a noose around your neck here. You need to weight it up. Mortgage free property in sweden against a deprecating asset here that may or may not rent over the next few years.

Kristopherus

I would suggest you seriously consider the option of getting a pretty good rent here, and if you have to , use the rent to fund any mortgage you may have to take out in Sweden. Whatever way you go, try to make it a win/win scenario.

Pa ElGrande

IMHO. It's a no brainer, sell the house, clear your debts, setup with a clean sheet in another country and use the equity is left to build an investment portfolio (stocks, gold, pension whatever)
If you are intent on leaving a back door in case things don't work out in Sweden and want to rent it out, then you will possibly be using the services of a letting agent, speak to any in your area and find out the costs and potential issues involved. Also if you know anyone who rents a house in your area, speak to them about what sort of yield you can realistically expect, i.e. will it cover the mortagage and running costs.

warrenaldo

i would say go for it - worst case you dont like it over there and sell up. you will still probably get out with some profits from selling up. and can come home.
best case you love it and stay.

seems to me like if you take the chance you have everything to gain. and alternatively you dont have that much to lose.

superman12345

JESUS CHRIST - DON'T COME TO THIS WEBSITE FOR MONEY ADVICE!!

If you rent out your house it becomes an investment. It is no longer your home.

This means that you will have to pay capital gains tax on the property (which you won't if it is your home).

This also means you may have to pay stamp duty.

It is not worth it. Talk to an accountant.

Calina

Yvonnea,

you will get widely differing views, as you can already see.

My first piece of advice is make decisions on what is rather than what might be. You are going to Sweden. You have an opportunity to do it debt free. There are many plus points to doing it. You *might* come back to Ireland. Presumably you have already looked into the ramifications of the decision to move to Sweden in the first place.

You are thinking it would be better to keep the property here and rent it out and would like to know the ramifications.

The chief one is that you would be an absentee landlord and that is not an ideal situation for either you or your tenants. You will need someone to act as an agent here to protect your interests. That costs money.

If you don't sell the property within one year, you will be liable for CGT.
If you rent out the property you may also be liable for a stamp duty clawback depending on the when and the cost of buying it.
You will have tax ramifications. You will have to register the property properly with the PRTB. The rental market is not quite as stable at the moment as it has been. You cannot guarantee a "good" rental, as you're advised to get. All you will get is what the market bears. In many, many cases in the greater Dublin area that means that the rent will not cover the mortgage repayment and it may not even cover the interest section of a mortgage repayment.

You may think that you might lose out on more capital appreciation if you sell now. But there is as much a chance that you might lose out on capital depreciation if you sell now. There are increasing number of houses on the market and asking prices are coming down, having to be revised. There are houses and apartments in my estate in north County Dublin which have been on the market for more than 3 months. Put simply, the property market is not now what it was 8 months ago.

Being a landlord brings with it a lot of hassles, duties and responsibilities. You will be in Sweden trying to deal with this. You will have to deal with the tax liability vis a vis Ireland and Sweden and you will need proper - professional - tax advice from someone about how to handle this.

If I were in your position - and of course I am not - I would sell the property immediately and lock in your capital appreciation to your bank account. If the property market does collapse in any meaningful way here, experience in other countries suggests that it will play out over a number of years. It is the easiest and simplest solution.

Yvonnea

Hi All,

Decided to bite the bullet and sell house here.
Thanks folks for all the good advice.

Yvonnea.

FreeAnd..

Best of luck Yvonnea, hope it all goes great for you. I think in a few years time you will look back on this as probably one of the best decisions of your life.

Victor

Are you liable for property / wealth taxes in Sweden for an asset in Ireland?

If you want to maintain the escape plan, maybe consider selling and buying a smaller property in Ireland.

Talk to a good financial advisor.