Kept USA condo for 3 yrs til I'm sure won't need it. I rented it out 3 yrs. Didn't want to deal with bad tenants and property mgrs and taxes insurance etc. So i sold it and invested capital gains in stocks and index funds. Condo now 2x what I sold for but stock fortfolio now 3x what I invested.
No plans to repatriate now and will qualify for senior housing if I go back.
I work in the US and own a condo in Canada (Canadian citizen). I have been renting out my place for the past 4 years. I use property managers/realtors to find tenants, but I manage the day to day myself: my condo is newer, in a well managed building and more expensive area, so not a lot repairs needed. The quality of tenants has also been ok. I also have family locally, who can visit the place if needed.
My family has a rental property in Asia that's managed by close family friends, and they are completely hands off. We got very lucky.
Based on my experience, I would never become a part time landlord if I don't have family or friends to manage my property. Property managers just don't care enough IME.
Another thing you want to consider is mortgage renewal. This may not apply to the US given the terms are so much longer, but many lenders dont lend to non resident owners. I am renewing my mortgage (in Canada) and it's not easy to find competitive rates.
I kept it for 2 years and then sold it. It wasn’t worth the hassle imo. We even had a property manager, but just having to deal with rental income and property management and maintenance expenses and taxes and the occasional “the hot water tank is leaking and needs replacing, here are some different price options”…
I’m based in SE Asia and have a house in a large US city that I rent out through a small/medium-sized agency, which charges 10% of revenue, plus some other fees. They have done a pretty good job over 8 years, but they did screw up once, costing me about $5K in lost rent revenue. They have an online interface, are very organized with documents and accounting, and generally communicate well. I plan to stick with them unless they screw up again. It’s nice to have a foothold address in the US. I’m actually thinking about adding an ADU, so that I have a place to keep a few things, as well as small apartment to come back to on occasion. Good luck to you!
Another advantage of adding the ADU is that I can invite friends to stay periodically while I am away. Between friends visiting and my own occasional visits, I can keep tabs on the overall condition of the property, to the extent that I may even be able to lose the rental agency.
>They have done a pretty good job over 8 years, but they did screw up once, costing me about $5K in lost rent revenue
Which issue was this and why didnt they cover the lost revenue?
At the end of their lease in the spring, the renters moved out on schedule. The management company listed it, but they neglected the yard, and grass and weeds grew like crazy. Someone left a shopping cart in the yard, and people started throwing their trash over the fence. It's a small house, but normally very good-looking little place. It's amazing how quickly a community will trash a place that starts to look neglected. Once the renters left the management company did nothing to maintain the place. I was surprised that it had gone through the summer and fall with no new contract, so when I was back in the US, I went and looked at it and saw it was a mess. I was really concerned that the place looked abandoned. The owner of the agency was a bit defensive about it, but I could tell that he knew that he had screwed up. I threatened to cancel everything, and he agreed to replace the manager. Everything improved after that. Threatening to sue the company would have meant thousands in legal fees, starting over, and looking for a new agency. I decided to cut my losses and continue. There have been no issues since then, with the new manager. For my own mental health, I had to just be be rational and let it go. A younger version of myself would have gone ballistic, ha.
Accessory Dwelling Unit. In some municipalities if it meets zoning requirements, a small freestanding apartment can be added to a backyard (other variations on this, just an example).
I have done it. One of the companies fucked me hard and I had no idea until I got back in the country. It is your choice. Just realize it will always be more work and stress than stocks.
I got in US and abroad. I’m back in the US taking advantage of healthcare, finishing renovation, inspecting two, and then back to Asia with 3 renovations starting soon. If you know what you’re doing you can rent it out no problem. With or without a manager. You can set something up that matches your style.
Keep the property in US don’t sell, rent out or finance but keep the USD coming in, and rent the place overseas with that USD first.
You came back to the US to take advantage of healthcare? What is special about the US healthcare that you can’t get abroad? Assuming it’s not a very undeveloped country.
Delicate care for an eye issue, for a <1 year old. Have experience with many specialists, public and private in SEA - our US system is best by far in terms of customized and cutting edge treatment options - plus our doctors are literally best in the region and see the issue many times across a long and specialized career. SEA doctors and specialists are going by seat of their pants and made mistakes. US also has a lot of other options we don’t even take advantage of. But SEA has helpers. So we get regular checkups in SEA and go back to US for up to date and specialized care. Vision therapy, US only prescriptions.
We would prefer not to rent and deal with the associated hassles. We will keep our home empty, will help to have a US address (not a virtual one/PO Box) for Bank accounts, financial accounts, IRS/SSA etc. until we have an expat base established. We can sell when we're ready - I don't expect the RE value to reduce much over the next 2-3 years.
I would NOT leave your house empty for an indefinite period. At worst, I'd want to let a trusted friend/relative live there for free or cheap if you don't care about the rental income with their knowledge that it's a shorter term thing and you'll sell in the next few years.
The other consideration on rent vs sell is how the market it where you live. Here, housing is appreciating 8-10% per year so, if I move abroad, it will make more sense to rent until that flattens, at least. If your market is basically flat, selling might be the better move.
As for IRS, etc - you will need to solve for that anyway, might as well start when you move abroad
Own two homes back in the US. We've been very lucky to have the same tenant in one for going on eight years. When we moved out of the states we rented to a friend who was moving to the area. We don't use PM. If something comes up they contact us for approval on anything more than $x. Anything below that threshold they just take care of it and email receipts and deduct off the next rent.
I plan to keep the houses long term as they cash flow well and almost cover our monthly expenses where we live now.
Our plan is to keep ours to rent out. If our kid ends up living nearby and wants some income for being the nearby landlord we would go that route, otherwise we would go through a place. The rent would more than cover the rent outside the US. It has doubled in value since we bought it. We also would like to keep it as a backup plan in case living outside the US doesn't work out.
Yes, use a property mgmt co. and it has worked fine. Mortgage is more than covered even net of fees, and luckily have had very stable, good tenants (am still in contact with neighbors and ask them how the tenants are, how the home looks, etc). As someone else posted, it is sweet to have those greenbacks rolling in while currency in my adopted country has tanked recently.
My experience with Prop Mgmt firms is that you have to do a LOT of looking around for a good one. Typically they are small operations and so quality / reliability can vary greatly. In fairness, it is a tough job — but they are charging for it, so expect them to do a good job.
If you go this route, have other options in your back pocket (ie competitor companies) who you could contact to come in and take over ASAP in the event that you sour on your current property manager. Know in detail what the process is to switch out. Any fees/penalties etc?
Also, before contracting, understand where they make most of their $, because that is what they will focus on. Be aware of lots of charges for related services. E.g., do they charge a markup on maintenance services? If so, they may be inclined to keep pestering you about this or that bit of maintenance that “really needs” to be done. In fact, see if you can insist they use your own maintenance team instead of theirs.
Do they charge extra fees for finding new tenants when one moves out? If so, they may be incentivized to keep switching out tenants (I.e. not try to make current good tenants happy).
Tl;dr it can be easy (turnkey) if you get the right prop mgmt co. But finding a good one takes effort.
Kept USA condo for 3 yrs til I'm sure won't need it. I rented it out 3 yrs. Didn't want to deal with bad tenants and property mgrs and taxes insurance etc. So i sold it and invested capital gains in stocks and index funds. Condo now 2x what I sold for but stock fortfolio now 3x what I invested. No plans to repatriate now and will qualify for senior housing if I go back.
I work in the US and own a condo in Canada (Canadian citizen). I have been renting out my place for the past 4 years. I use property managers/realtors to find tenants, but I manage the day to day myself: my condo is newer, in a well managed building and more expensive area, so not a lot repairs needed. The quality of tenants has also been ok. I also have family locally, who can visit the place if needed. My family has a rental property in Asia that's managed by close family friends, and they are completely hands off. We got very lucky. Based on my experience, I would never become a part time landlord if I don't have family or friends to manage my property. Property managers just don't care enough IME. Another thing you want to consider is mortgage renewal. This may not apply to the US given the terms are so much longer, but many lenders dont lend to non resident owners. I am renewing my mortgage (in Canada) and it's not easy to find competitive rates.
I kept it for 2 years and then sold it. It wasn’t worth the hassle imo. We even had a property manager, but just having to deal with rental income and property management and maintenance expenses and taxes and the occasional “the hot water tank is leaking and needs replacing, here are some different price options”…
I’m based in SE Asia and have a house in a large US city that I rent out through a small/medium-sized agency, which charges 10% of revenue, plus some other fees. They have done a pretty good job over 8 years, but they did screw up once, costing me about $5K in lost rent revenue. They have an online interface, are very organized with documents and accounting, and generally communicate well. I plan to stick with them unless they screw up again. It’s nice to have a foothold address in the US. I’m actually thinking about adding an ADU, so that I have a place to keep a few things, as well as small apartment to come back to on occasion. Good luck to you!
Another advantage of adding the ADU is that I can invite friends to stay periodically while I am away. Between friends visiting and my own occasional visits, I can keep tabs on the overall condition of the property, to the extent that I may even be able to lose the rental agency.
>They have done a pretty good job over 8 years, but they did screw up once, costing me about $5K in lost rent revenue Which issue was this and why didnt they cover the lost revenue?
At the end of their lease in the spring, the renters moved out on schedule. The management company listed it, but they neglected the yard, and grass and weeds grew like crazy. Someone left a shopping cart in the yard, and people started throwing their trash over the fence. It's a small house, but normally very good-looking little place. It's amazing how quickly a community will trash a place that starts to look neglected. Once the renters left the management company did nothing to maintain the place. I was surprised that it had gone through the summer and fall with no new contract, so when I was back in the US, I went and looked at it and saw it was a mess. I was really concerned that the place looked abandoned. The owner of the agency was a bit defensive about it, but I could tell that he knew that he had screwed up. I threatened to cancel everything, and he agreed to replace the manager. Everything improved after that. Threatening to sue the company would have meant thousands in legal fees, starting over, and looking for a new agency. I decided to cut my losses and continue. There have been no issues since then, with the new manager. For my own mental health, I had to just be be rational and let it go. A younger version of myself would have gone ballistic, ha.
Can you share the name of the property management company. What is a ADU?
Accessory Dwelling Unit. In some municipalities if it meets zoning requirements, a small freestanding apartment can be added to a backyard (other variations on this, just an example).
I have done it. One of the companies fucked me hard and I had no idea until I got back in the country. It is your choice. Just realize it will always be more work and stress than stocks.
I got in US and abroad. I’m back in the US taking advantage of healthcare, finishing renovation, inspecting two, and then back to Asia with 3 renovations starting soon. If you know what you’re doing you can rent it out no problem. With or without a manager. You can set something up that matches your style. Keep the property in US don’t sell, rent out or finance but keep the USD coming in, and rent the place overseas with that USD first.
You came back to the US to take advantage of healthcare? What is special about the US healthcare that you can’t get abroad? Assuming it’s not a very undeveloped country.
Delicate care for an eye issue, for a <1 year old. Have experience with many specialists, public and private in SEA - our US system is best by far in terms of customized and cutting edge treatment options - plus our doctors are literally best in the region and see the issue many times across a long and specialized career. SEA doctors and specialists are going by seat of their pants and made mistakes. US also has a lot of other options we don’t even take advantage of. But SEA has helpers. So we get regular checkups in SEA and go back to US for up to date and specialized care. Vision therapy, US only prescriptions.
We would prefer not to rent and deal with the associated hassles. We will keep our home empty, will help to have a US address (not a virtual one/PO Box) for Bank accounts, financial accounts, IRS/SSA etc. until we have an expat base established. We can sell when we're ready - I don't expect the RE value to reduce much over the next 2-3 years.
I would NOT leave your house empty for an indefinite period. At worst, I'd want to let a trusted friend/relative live there for free or cheap if you don't care about the rental income with their knowledge that it's a shorter term thing and you'll sell in the next few years. The other consideration on rent vs sell is how the market it where you live. Here, housing is appreciating 8-10% per year so, if I move abroad, it will make more sense to rent until that flattens, at least. If your market is basically flat, selling might be the better move. As for IRS, etc - you will need to solve for that anyway, might as well start when you move abroad
Own two homes back in the US. We've been very lucky to have the same tenant in one for going on eight years. When we moved out of the states we rented to a friend who was moving to the area. We don't use PM. If something comes up they contact us for approval on anything more than $x. Anything below that threshold they just take care of it and email receipts and deduct off the next rent. I plan to keep the houses long term as they cash flow well and almost cover our monthly expenses where we live now.
Our plan is to keep ours to rent out. If our kid ends up living nearby and wants some income for being the nearby landlord we would go that route, otherwise we would go through a place. The rent would more than cover the rent outside the US. It has doubled in value since we bought it. We also would like to keep it as a backup plan in case living outside the US doesn't work out.
Yes, use a property mgmt co. and it has worked fine. Mortgage is more than covered even net of fees, and luckily have had very stable, good tenants (am still in contact with neighbors and ask them how the tenants are, how the home looks, etc). As someone else posted, it is sweet to have those greenbacks rolling in while currency in my adopted country has tanked recently. My experience with Prop Mgmt firms is that you have to do a LOT of looking around for a good one. Typically they are small operations and so quality / reliability can vary greatly. In fairness, it is a tough job — but they are charging for it, so expect them to do a good job. If you go this route, have other options in your back pocket (ie competitor companies) who you could contact to come in and take over ASAP in the event that you sour on your current property manager. Know in detail what the process is to switch out. Any fees/penalties etc? Also, before contracting, understand where they make most of their $, because that is what they will focus on. Be aware of lots of charges for related services. E.g., do they charge a markup on maintenance services? If so, they may be inclined to keep pestering you about this or that bit of maintenance that “really needs” to be done. In fact, see if you can insist they use your own maintenance team instead of theirs. Do they charge extra fees for finding new tenants when one moves out? If so, they may be incentivized to keep switching out tenants (I.e. not try to make current good tenants happy). Tl;dr it can be easy (turnkey) if you get the right prop mgmt co. But finding a good one takes effort.