What would you do?

SweetSand

Hi everyone

I would love some advise as things are happening fast and I am emotionally attached to our house.
We bought our lovely house 3 years ago, it is just outside of Galway in a really nice location, 7km to Galway, 6km to Barna and 3km to Moycullen, 1.5km to primary school. We bought it when market was at the very bottom and paid €270000. We are on a variable rate with UB with monthly repayments of €1300 and €220000 left.
My husband has been offered a job in US and it looks like we ll be relocating in the next 2 months. It is permanent and we are looking at staying there for 5-10 years if not for good. We have 2 kids 3 and 5 yo, so our initial thoughts were to stay in US for their primary school years and maybe come back for secondary school here? Anyway, I asked the auctioneer to call in this morning and his valuation of the house is €425-435000 and he was very confident that our house will sell very quickly because of the location and house itself. If we decide to rent, his valuation is €1200-1400pm. We know this auctioneer well as he sold our 2 previous houses and trust him.
Originally we thought that we ll rent the house out but after tax, property tax, insurance and etc the numbers are not looking that great. We wont be able to afford to have the house sitting empty either. But we love our house so much but then, we might not ever be back. So what would you do? Sell or rent? If we decided to sell, my husband's relocation package covers all the fees as well, solicitor and auctioneer.
Thanking you!

BetsyEllen

I would personally sell.

I wouldn't want the stress of it hanging over me, constantly worrying about the house.

Easier said than done though when you have an emotional tie to a place.

Is it possible to hang onto it for a year or so until you are sure America is going to work out?

Onthefence

Sell. The hassle of being a landlord isn't worth it in my opinion. As you say you might never be back!

Hollister11

I'd sell.

To be in a position to have 150K profit to take to the states is a no-brainer.

Michael D Not Higgins

Hollister11 wrote: »

I'd sell.

To be in a position to have 150K profit to take to the states is a no-brainer.

Indeed whereas the other option involves a cost of several hundred euro to top up the mortgage after rent minus tax and expenses.

Not to mention the fact that you'll lose CGT exemption and have to pay a proportion on tax when you sell. For example, you've had it for 3 years, say you keep it another three, half the gain will be taxable. Let's say there's modest 5% growth for three years, you're looking at a selling price around €490k and a tax bill of 36k, i.e. you roughly the same as selling right now after the rental return and mortgage top up costs.

(not gospel, I'm not sure on tax arrangements between Ireland and the US for this sort of thing)

mewe

Sell sell sell!

SweetSand

Ahh, it looks like everyone is for selling I know in my head it does make more sense but in my heart I was hoping that someone will come out with great numbers for renting now and maybe selling later or never ))
As for trying America for a year, thats my other concern, what if we ll hate it? But we ll be tided up there for 2 years anyway as otherwise we ll have to repay relocation costs. Plus we are just back after 9 months in America, but that was in California and we loved it there Now we are looking to relocate to Boston.

BetsyEllen

Everyone here is for selling as we don't have the emotional connection to the house that you do.

We're just strangers on the internet thinking with money in mind, and a stress free life! However I know the feeling of loving a house and not wanting to let it go.

If you really, really want to keep the house you need to weigh up the pros and cons of same and see if you can make it work.
If you can and you feel that the benefits of keeping the house outweighs the stresses involved then go for it.

However I would worry that after say 3/4 years in the US, your emotional attachment to the house may have waned and you'll regret not selling when your husband's company was willing to cover the fees involved and when you would have got an excellent price.

maryk123

Sell sell and sell. The hassle of being a landlord is ridiculous and you are not within calling distance if something goes on. Other option is to rent for the year see how you get on give to auctioneer in case USA doesn't work. If yee are dead set in staying there though without doubt I would sell.

DubCount

I would sell as well. The maths just dont add up for a rental property. At 1400 per month (max you could expect) the yield (rent over cost) is less than 4%. Thats just too low and doesnt take account of tax, property management costs, potential cost of possible rent arrears etc.. If you took the 180k positive equity you would have from a sale, you could invest in a rental property with a better yield that could give a similar income, but with no mortgage.

Emotion and investment dont usually mix well.

Hope it works out well for you.....

Miaireland

I would lease the house out for a year and then decide. I know of people who moved to the States and loved it and of a couple who returned after 8 months. At least you have a year to find your feet and have the option to return home if you are not happy there.

MicktheMan

Miaireland wrote: »

I would lease the house out for a year and then decide. I know of people who moved to the States and loved it and of a couple who returned after 8 months. At least you have a year to find your feet and have the option to return home if you are not happy there.

As someone who has moved to and lived in the States and also moved provinces in Ireland with family in tow, I would caution about this advice. Moving with family is never easy, especially to a different country. Different members of the family will go through the highs and lows at different times and sometimes when there is an easy route back (i.e. we still have our house back home), not enough effort may be made to make the move a success. Selling the house may help focus the mind in these situations.