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You’re Moving Overseas – Is it Better to Buy or Rent?
One of the big decisions you will have to make if you are moving overseas is whether to buy or rent a new home while you are there. Hamiltons Removals offer European house removals as well as moving packages to many international destinations; here we look at some of the key factors which should be considered when you make your choice.
Short-term or Long-term?
Of course, the biggest factor in determining whether to buy or a rent a home when moving overseas is how long you’re going to be there.
If you are only there for a short period of time, for example on a fixed-term work contract and are looking at commercial removals to Europe, then it may be better to rent a home. You may be paying out more in rent than you would be in monthly mortgage repayments, but you will avoid all the administrative time and hassle (especially if you have to move again at relatively short notice).
If, on the other hand, you are moving to retire or start a new life overseas for the long term, buying a home outright may be a better option – you will also be building up an asset which you may be able to pass on to future generations of your family. Also, the mortgage repayments are likely to be lower than the monthly rent; also, if you buy, you also have the psychological benefit of the property really feeling like home, helping you to ‘belong’ in your new country.
Country by Country
The situation can vary country by country – you may be expected to put a much bigger deposit down if you are a UK national and are buying a property overseas. It’s around 30% for Spanish properties, and 40% if you are moving to Italy.
There’s also the issue of supply and demand – lack of supply (and surplus of demand) may drive house prices up, as in countries like Ireland and here at home in the UK.
In some countries there just isn’t a strong culture of home ownership. For example, if you are thinking of a house move to Switzerland, or international removals to Germany, then you might be surprised to hear that more than half the working population in those two countries rent their home anyway (in Germany the figure is now just over 50%, and in Switzerland it’s nearer 58%). This is often due to stronger rights and protection for tenants, making renting an attractive option for working professionals, rather than just a compromise for those who cannot afford to purchase a property.
If you are thinking of moving further afield, some US states have rent controls in force to keep prices down; while if you are considering overseas moves to South Africa, the capital gains tax there is so high (at 33%) it incentivises renting as well.
At Hamiltons, we have more than three decades’ worth of experience in helping people move overseas so we should be able to provide some helpful advice on the country you are moving to, wherever in the world you’ve got your eyes set on.
Flexibility
If you want maximum flexibility – which is particularly important if you haven’t decided on your long-term plans and want to keep your options open – then renting is the better option.
If you rent a property and your circumstances change, it should be much easier to upgrade either to a new rented property, to buy a home outright (or take out a mortgage on one) or even to return to your native country.
Your Current Home
You may be able to offset some of the cost of moving overseas by either selling or renting out the home you are moving out of. The latter option also has the advantage of ensuring that your home is well looked after while you are not in the same country.
Again, renting it out gives you more flexibility – you should be able to return to it should you wish to – but you will still be responsible as a landlord for its maintenance and upkeep, which may be more difficult to do from afar unless you appoint a management company to do it for you (which could be expensive).
Selling your home outright will absolve you of that responsibility (and expense) and you may well need the money from the sale anyway to help fund your move overseas.
The Cost of Living
It’s not just the cost of accommodation you have to think of, but the overall cost of living in the country you’re moving to as well – so you may have to tailor your buying or renting decision to other financial factors as well.
For instance, a recent BBC survey found that UK food costs were 7% below the EU average – but the UK was still more a more expensive place to live overall than Germany (but cheaper than France).
European House Removals with Hamiltons Removals
So, there are arguments for and against (on both sides) – but whether you decide to buy or rent abroad, Hamiltons Removals will be able to help you move.
We offer removals packages to all the major European countries, including France, Germany, Switzerland, Italy and Spain. And if you need any storage facilities while you are away, we can help with that too, thanks to our Safe N Stored self-storage facilities.
If you would like to know more about our European house removals packages, follow this link.
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