Should we sell?

[Passthebourbon]

No one can really tell me what to do here, but I'm a bit torn so perspectives would be helpful.

We have agreed a sale on our house with a view to spending a couple of years abroad before buying in a totally new area. We sold our very unusual house quickly for a much better price than I was expecting. But now I'm concerned about being out of the housing market for two years (as well as paying rent on our house overseas). I know there are some predictions of prices going down, but my feeling is that this is not highly likely. I don't want to be in a situation in 2 years where we can't really afford to come home and buy in our new area.

So the options are:

1. Delay the move for a while until we know what's happening, but lose our buyer (we don't have to go abroad until next summer).
2. Rent the house instead of selling it (but we know we don't want to come back and live in it, because when we return we'll be living elsewhere).
3. Accept being out of the market for a couple of years and don't worry about it!
4. Buy in the new area that we will be returning to after our time abroad, and rent it out while we are away.

Thoughts....?

I think that’s a massive change which will always have a bit of a gamble so cold feet seems inevitable, but I think it will also take a great deal of bravery.

If house prices do fall (I think unlikely, possibly a bit stagnate but I think they’ll keep increasing but at a much slower rate) then delaying selling will mean selling yours for a lot less money. Selling now means getting a good sale price. Your issue would be more if they sky rocketed... which will always be a risk but I don’t think they will.

I vote you sell now and get a good price secured with the money safely in the bank.

Worse case is you’ll have to compromise on what you want / where you want to be in a couple of years. But you can’t foresee that and this year has proved anything can happen!

I just read my reply back and I’m not sure I’ve made complete sense but hopefully enough sense?

Thanks Babs. I think you’re right that my courage is failing me slightly.

Yes makes total sense!

I say sell now and buy when you come back. This might give you an advantage also as you won't need to wait until your house is sold and less of a chain.

Option 4 is tempting, especially while we are in the stamp-duty-free period, but then you have the hassle of organising the rental (or, rather, of chasing your managing agents) and declaring the income to (?both?) tax authorities. I'm not sure about rushing in to buy in the new area - you want to get to know the area better before you make a big commitment like a house purchase. Also, you may be a different person in a couple of years' time and have different priorities.

I think option 3 may be best but don't be so blasé about it. Get financial advice about putting the money somewhere sensible. Lots of people do the abroad-for-a-few-years thing so there must be specialist advisers out there.

Thanks @senua and yes I agree about doing something sensible with the money. We know the new area very well, so we could buy there quite easily. But there is the issue of priorities changing over that time.

It depends on what sort of property it is - does it have a garden? If not, definitely sell now. If it does I'd rent it and you will have the rental income in the bank less expenses to come back to as well as the equity. Make the asset work for you while you're away. You won't get a similar return by putting the proceeds of a sale in the bank.
I don't believe prices are going to dive - maybe plateau and then continue upwards but I think that's unlikely. In our area flats can't be given away at the moment whereas houses are going for record amounts. This won't change as families are always looking to move into this area.

Number 4. Safe as houses!!

Yes, it has a massive garden and I think that's why it sold so quickly.

And you're right, the money in the bank will do very little. OTOH, the house needs constant maintenance!

I'd go for Option 4. Depending on what type of sums you're talking about, the stamp duty saving could be significant and at the end of the day, you'll have an asset whose mortgage is being paid by tenants whilst you're out of the country. Yes, there will be an element of hassle in terms of liasing with agents and paying tax, but I'd certainly go down that route if I were you.

Ok, some very interesting feedback thanks. No one is going for option 1!

How much of a difference is the stamp duty holiday making? If we waited to sell until next summer, would we find there is no one looking to buy?

@Passthebourbon I'm in the same situation, although our house is now sold.
I feel rather weird not having a home here in the UK, but I think that will go away when I get to our rental flat in the new country (DH is already there).
We are contemplating buying something in UK but it feels too unknown at the moment, we took a £20,000 reduction on our house sale during Covid lockdown and everyone thought the market would fall, but actually it's currently gone the other way, so we feel we made the wrong call, I don't want to do that again.
I also don't really want to be a landlord,
And we have no idea where we would want to live when we return.
It's confusing!

In part it depends on where you are selling and where you would be moving...

@RandomMess we are selling in Suffolk and planning to move to Kent.

@Itscoldouthere it's quite nerve-racking isn't it? I really feel for you with the timing of your sale. Obviously if you are selling and buying at the same time changes in the market are less of an issue, but if you're taking time out the stakes are so high.

Houses are selling in days where I live. I’d buy in location of my choice and let it. If you buy a new build you have a two year guarantee from the builders so your tenants can get any faults fixed quickly and at no cost to you.

We have done 3, so obviously thinking it is the right choice... even if self doubting ourselves regularly.

Option 3. Prices aren’t going to skyrocket in two years to the extent you’ll find yourself priced out of the market. If it’s an unusual property there’s always the risk that you’d struggle to find another buyer for it in future when you do want to sell and buy. With no chain behind you, you will be in a much stronger position when making offers than if you have something to sell.

Letting a property out isn’t “safe as houses” as another poster suggests. Potential buyers are often reluctant to offer on a tenanted property as you can’t promise vacant possession - tenants can refuse to allow viewings or refuse to move out at the end of their lease, and you don’t want to be dealing with the headache of that when you’re actually wanting to buy somewhere.

Op don’t wait two years you face a huge gamble that prices get away from you and you should never ever gamble what you can’t afford to loose.

We moved abroad, but stayed five years in the end (was originally supposed to be two) , we rented our house out in that time, the rent paid the mortgage and we got savings from it. We sold on our return, as in we were returning and sold before we came back and then bought straight after, so we were chain free and moved straight into our new house on our return.

I’d strongly advocate you do the same.

Sorry I should have added we gave notice to our tenants and then sold and then bought, in that order, so vacant possession. Not in a chain. And we financially came out on top.

Option 4 looks best and if you don't find something you want in the new area, leave your money in the bank. But don't lose your buyer now.

I would look to buy in Kent, perhaps not a forever property something that will be low maintenance and easy to rent out.