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I guess I don't see the tremendous upside to keeping the house if you don't have concrete plans to return to Australia
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Jan 10, 2019 13:06
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CelestialScribe posted:Did some research on this today. It actually won't be expensive at all for me to maintain the property re: declaring rental income, as all the deductions are the same in both countries. I'll be out of pocket around $600 for land taxes and another $1000 or so for Australian taxes, but the real downfall is the risk: are people going to rent the house, will it stay in proper repair, what happens if things go wrong, etc. The real downfall is even if everything went absolutely perfect - you have a near 0% vacancy rate (you won't) maintenance costs stay low and stable (they won't), your renters are perfect and pay on time, all the time (depends on luck), etc. - you'll still be dealing with a property literally on the other side of the Earth, which is a pain in the rear end. All for what? A few hundred dollars a month income stream that is one broken water heater away from going in the negative? Combine this with a major move, change of jobs, new culture - like I said, you are a madman, or (more likely) being completely unrealistic about this undertaking. Sell the house. Either bring in more than 120k/y or move somewhere other than two of the most expensive regions on each coast of the US. If it's literally true that the only places that have the jobs you need/want/are qualified to do are NYC, Seattle, the Bay area - which I doubt - and 120k is about the most you can expect from it....why move at all? Is that really going to be an upgrade for you?
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Jan 10, 2019 16:59
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 10, 2019 21:37
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CelestialScribe posted:(Australians will travel to the USA - in the 10 years we have been together in Aus, not one US relative has come to visit.) Sorry, when you get 2 weeks vacation a year and you have to spend 2 days of them in an airplane to get there, it sounds like a bad deal.
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Jan 10, 2019 22:50
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 10, 2019 22:59
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CelestialScribe posted:I completely agree there are absolutely risks here, but you seem to *really* be overestimating how often they occur. I know and speak with a lot of investment property owners in my city, and none of them have anywhere near the bad luck you seem to be describing. Yes, things break and need to be replaced. Yes, occasionally you get a month or two of rent that's late. You get vacancies. But you seem to be portraying it as, "this is absolutely going to be a huge pain in the rear end and you are going to be stressing about it every single day". I just don't think that's realistic based on the people I've spoken with. There are definitely those who say they wish they sold. Most say it hasn't been that much of a bother. My friend, I'm not talking about renting a house in general. I have a rental property myself, and while I still suspect you aren't really mentally prepared for land-lording yet - you need to do a lot more background work to prepare based on your comments - yes, it can be rewarding, and in itself doesn't have to be a huge pain in the rear end all the time. Though it can be, and those times, take my own word for it, will come out of nowhere. The only way to prepare for them is to be always prepared for them. I'm really talking about you renting your current home in loving Australia while you live full time in the United States. How many of your landlord advice-giving buddies are doing that? Enough of them to provide a meaningful spread of data? Managing that while managing a major move of almost every other aspect of your life...not saying it can't be done, but you don't seem to have thought it through. I don't think you've thought the job situation through nearly enough. Plenty of people in NYC and Seattle looking to get out of those areas due to escalating costs. You have an entire country to pick from and a lot of major cities with opportunities of every type. Denver, Austin, etc. are fairly major cities in their own right and not regarded as places where people get "stuck" to point out one flaw in your assumptions. Holy hell, the number of Seattle & Bay Area refugees here in Austin alone is starting to get out of hand even though it is a fairly significant change in weather for them. I think you need to do a lot more research. And maybe visit another city or two in the US. If you are planning on spending your life here it is worth the time and expense now, rather than settling in and figuring it out later. And sell your house 
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Jan 10, 2019 23:12
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 10, 2019 23:21
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If you gave more information on what you do it'd be easier to help you. You're in a technical field clearly but based on your descriptions I haven't the slightest idea what. Something is off with your data but I don't know where to begin without more info.
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Jan 10, 2019 23:36
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 10, 2019 23:37
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CelestialScribe posted:I'd be happy to discuss it privately but I don't want to reveal what I do on here. PM me if you want.
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Jan 10, 2019 23:41
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CelestialScribe posted:As for the upside, the capital appreciate can be significant over the long-term. Especially in Melbourne. I'm not sold on it either way yet, but that's the benefit. have you run numbers on this because i think if you are extrapolating the last 10-20 years of price growth you are ignoring the idea that past performance is not an indicator of future performance
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Jan 11, 2019 14:55
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KYOON GRIFFEY JR posted:have you run numbers on this because i think if you are extrapolating the last 10-20 years of price growth you are ignoring the idea that past performance is not an indicator of future performance I am from 2007 and I assure you real estate only appreciates in value.
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Jan 11, 2019 18:45
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OP, I know you said "to a lesser extent, Chicago", but you should really consider that one. Chicago rules (I live in Pittsburgh, but Chicago is the only other city I regularly consider moving to). It's still relatively expensive, but compared to New York and Seattle, it will be a bargain for you.
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Jan 11, 2019 19:18
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 11, 2019 21:04
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m0therfux0r posted:OP, I know you said "to a lesser extent, Chicago", but you should really consider that one. Chicago rules (I live in Pittsburgh, but Chicago is the only other city I regularly consider moving to). It's still relatively expensive, but compared to New York and Seattle, it will be a bargain for you. Good to know, thanks. I've heard good things about certain school districts too.
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Jan 11, 2019 21:05
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I think you and that Canadian kid who was debating between NYC and Tokyo should start a life coaching business together.
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Jan 11, 2019 21:07
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CelestialScribe posted:I'm saying over the long term, property appreciates. This isn't a controversial statement. You really need to take a closer look at how many people are still financially hosed from 2007-2008 before you raise a question like that. Houses aren't investments. Not at the level you are talking about anyway. There's also an element of risk management here you should re-evaluate re: If everything goes perfectly for you, in 10 years you could end up a little better off, maybe low double digits better if a lot of things (most of which are out of your control) swing your way. On the other hand, if a few things go off the rails, like you can't find a renter for months on end, have major maintenance problems, other circumstances in your life change, etc. etc. you could end up royally hosed. You're playing the odds of "Win small, lose big" which is a bad bet under any context. You're moving across the world. Lock in the gains you have now and have a lot less to worry about later.
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Jan 11, 2019 21:22
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 11, 2019 21:30
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i am far too lazy to dig this up but returns on the broad equities market are good. S&P 500 has averaged 10.x% returns since the 1970s and when you park that dosh in a brokerage account you are only exposed to market risk and you never have to touch it or manage it in any way
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Jan 11, 2019 23:00
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why are you assuming that the Australian property market, which by all accounts is a massive bubble propped up by speculation and foreign investment, will not crash when the Australian raw materials export economy slows?
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Jan 11, 2019 23:01
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 11, 2019 23:14
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this includes all of the downturns and poo poo, friend. what do you anticipate your gross and net return will be on the house?
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Jan 11, 2019 23:29
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 11, 2019 23:31
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CelestialScribe posted:lol no sorry, don't ignore the question. You *literally* just told me before that past performance does not indicate future results. So...why is it okay to look at past equity results and suggest that's a sure thing, but when you look at a relatively similar pattern for a property market (rise over time), that's totally way off base? Long term property values have appreciated at about 1% above inflation rates, whereas stock market returns have appreciated at 5-10% above inflation rates. However you would need to know about 50 other things to determine the investment value of the rental property relative to a market investment, which you don't really seem to understand based on your responses so far. Which is why it's obvious to everyone here that you don't know what you're doing as a landlord.
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Jan 11, 2019 23:42
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CelestialScribe posted:The other part of the equation is here that at some point, we *may* return to Australia. It's unknown. Having a house when we get here would help a lot. It is possible that Australia might remove the law limiting every citizen to 1 home purchase per lifetime by the time you decide to move back.
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Jan 11, 2019 23:43
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 11, 2019 23:46
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CelestialScribe posted:lol no sorry, don't ignore the question. You *literally* just told me before that past performance does not indicate future results. So...why is it okay to look at past equity results and suggest that's a sure thing, but when you look at a relatively similar pattern for a property market (rise over time), that's totally way off base? broad market returns on an entire class of assets making up 6x Australia's GDP over a longer time period than i imagine your analysis covers is why S&P 500 forecasts are more stable, but what's your expected rate of return for your property, gross and net, and what are you basing it off of?
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Jan 11, 2019 23:49
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https://www.forbes.com/sites/johnwake/2018/07/23/5-reasons-home-prices-are-falling-in-australia/#1d9af25b2e54 read something
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Jan 11, 2019 23:51
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CelestialScribe posted:For Australia, or the United States? No one does detailed long term historical analysis on Australia alone because lol. I dunno how much your prison tents have appreciated in value since the British locked you in them. If real estate is such an amazing investment there why don't you stay and buy more houses
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Jan 11, 2019 23:53
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CelestialScribe posted:Why are you telling me to do more research when this statement is based on no research at all? Low double digits is something you've just pulled out of nowhere. I pulled it out of my very real, and personal, experience both selling property and renting it over the past 25 years. CelestialScribe posted:Like I get it - it's a risk. But you're acting like this will inevitably crash and burn and that isn't a realistic outcome to me. Especially as you're just assuming the us and Australian property markets are the same. I'm not assuming they are the same. Based on all the data so far, the property market in Australia is, generally speaking, far worse CelestialScribe posted:Don't get me wrong, I'm not sold on keeping the house either way. But I want the decision to be based on more than, "you will absolutely go into financial ruin if you keep it" based on little research. No one is telling you you will absolutely go in to financial ruin. Don't turn this in to a black or white argument because folks aren't validating your existing assumptions. We're pointing out (at least I am) simply that the risk is higher than you seem to assume it is. Whether you have tolerance for that is of course entirely on you.
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Jan 11, 2019 23:58
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The way I look at this is you have two choices. (I am ignoring capital appreciation for now because that gets in to my next point.) 1) Keep house, rent it out. Pros: You have a house in Australia to fall back on. You make a little bit of income off the rental when it is occupied. Cons: You have to find a tenant. There is risk as to how the tenant treats your house. You have to file taxes and paperwork. You are responsible for maintenance and repairs on the house. You have ongoing mortgage costs. 2) Sell house, put money in market. Pros: You don't have to worry about a house on the other side of the world. You don't have to actively manage anything. Cons: You don't have a house in Australia when you potentially decide to move back there in the future. There seems to be both more downside risk and more tedious bullshit to deal with in 1, so I really do not understand your fascination with it unless: a) it's a symbolic thing and a link to Australia that is emotionally valuable to you b) you strongly believe that your net returns will be much higher vs. the broad equities market over a long time period, so much so that it compensates you for your time effort and trouble c) you really love the house and you want to move back in to it I think we can rule out C since you seem kind of ambivalent, so is it A? and if it's B, what are you assuming your returns will be other than the vague platitude "property increases in value!" If you lived in America, right now, would you buy a house in Australia as a rental property investment?
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Jan 12, 2019 00:04
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 12, 2019 00:11
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CelestialScribe fucked around with this message at 03:47 on May 28, 2020 |
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Jan 12, 2019 00:13
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CelestialScribe posted:I really don't have an attachment to the house! I guess I don't want to make a bad decision re: capital growth over time. The former is very understandable, especially if you have been on the Wild Upside Ride of Australian housing. If you know all the stuff that is driving current capital appreciation is fundamentally unsustainable, why do you want to stick around for the Wild Downside Ride that is inevitably going to come at some point? Conservative long run estimates for a decently balanced portfolio of equities is real growth of about 5% per year. You will have to beat that number in net terms. If you think that's likely, and you think you'll be adequately compensated for your time and trouble, go for it. I personally find it hard to take care of poo poo at home when I'm 600 miles away, let alone 12,000, so unless I thought I was going to get like 10% a year I wouldn't even entertain the thought.
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Jan 12, 2019 00:19
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CelestialScribe fucked around with this message at 03:48 on May 28, 2020 |
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Jan 12, 2019 00:24
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I really wish there was more information about what you do. You're telling me there's 120 openings for your specific role in SF and only TWELVE in NYC? Are you really sure there's a future in this niche? Generally roles that are very niche in tech pay absurd salaries, and I can't figure out what in tech pays 120k and is worth moving across the world for. Middle of the mall tech roles are paying 150-200k+ in SF, Seattle, and NYC, and those salaries are ok to live comfortably on in all of those places, albiet perhaps without kids (and especially without special needs kids). Have you evaluated how much you'd potentially make in SF in this particular space?
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Jan 29, 2019 05:56
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CelestialScribe fucked around with this message at 03:48 on May 28, 2020 |
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Jan 30, 2019 12:40
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CelestialScribe posted:It isn't inevitable there will be a 2008 crash. The market is too different from the States. Fewer cities and higher population growth provide a boost. FWIW, I live in Melbourne too, and I strongly disagree with all of this. I don't really have a strong opinion on sell vs keep the house, but if part of your reasoning is based on the idea that "it couldn't happen here in Oz", your reasoning is straight up just bad. Can I ask which suburb it's in, or general kind of area?
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Jan 31, 2019 06:03
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CelestialScribe posted:I really don't want to reveal more, sorry. Just to give you an idea of where that salary sits, there are restaurants in SF paying waitstaff $80k a year and not being able to fill the positions due to COL. The median salary there is $97k. Absolutely nothing about salaries there can really be extrapolated to anywhere else in the US. $150k a year is a decent salary in Chicago. It's barely middle class in NY/Seattle, and not even within sight of property ownership in SF. Liquid Communism fucked around with this message at 07:45 on Jan 31, 2019 |
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Jan 31, 2019 07:42
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CelestialScribe fucked around with this message at 03:48 on May 28, 2020 |
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Jan 31, 2019 07:49
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