what's the best, sell up or rent out.

That's a tough decision. I don't know where you are located but if you are in Perth I think you would be crazy to sell the way the house prices are increasing.

If it was me I would hold on to the house for a few reasons. You always have a place to come back to if it all goes wrong, that a nice and secure feeling. You didn't say what you would be investing in but if its in the stock market then you are gambling and you could lose and lose big time (but you also have the potential to make big time). By keeping the house you may have moderate growth or moderate loss if the bottom drops out of the market. But you will still have your house. If you gamble on the stockmarket then you have the potential to make or lose big time.
A compromise may be to realise some of the equity in your home in the form of a loan and invest that money in the stock market or what ever investment you had in mind. If you do well you have to only service the loan for a short time until the return on your investment starts to pay the interest on the loan. And you still get to keep your house rented out. This is an expensive option but can give you the best of both worlds. Make sense or have I confused the matter? Hope this helps a bit.

I'd spend a few months on the road just to be sure before I'd sell the house.

Seen to many people change the views over time.

Robin MIller

thanks Dustin and Robin for your quick reply's, sorry i didn't say where we are but it is the gold coast. food for thought already. thanks.

Kampen,

My advice would be, don't sell the house, start yer trip and then have another look at things.

Whilst we never had any intention of selling the house, we did start off on a trip and decided after 3 months that we weren't really enjoying it all that much. It was OK but,,,,,,,,,,but we got bored going from one van park to another.

We ended up going back home for the summer and getting re-kitted out to go back to gold prospecting - which we've been doing for years, off & on.

So now we stay home, near the baech in summer and go bush for gold in the winter.

I'm glad we didn't sell - we live near the beach in Perth and prices are just incredible!

Bilbo

Yep, don't sell the house, you'll have something to come back to, as it's almost a certainty that after 12 months on the road you'll be looking for home comforts again, at least for a while. And the stock market is at a real high at present, meaning that there's a chance of it falling soon. Rentals are good for house owners at the moment, just make sure you get a good tenant. If you're travelling, then search out a good agent to handle it all, incl repair issues.
Easier to rent out unfurnished, as appliances and furniture create additional breakdowns to worry about. Just make sure that the house is pretty ship-shape (eg hot water system) before you go so that the agent is not ringing you re major breakdowns.
Gerry

Don't sell up. If you find a better spot (and I live here and have been there done that and there's no better place :)) then you can flog the property. Excellent advice on doing a shorter trip first. You might actually find that you miss your friends and *shock, horror* the kids. Good luck with it.

Start by going to a local real estate agent that has a good reputation for property management . Ask them to inspect your property and produce a speadsheet on income and costs when rented . Be careful about assumed inflation rate , tennant turnover [ letting fees ] , and predicted rent increases . Make extra allowances for maintenance , damage and loss of rent . Finally , you will have calculated a percentage return on the value of your house . Historically this has been about 4% , but because rents haven't increased in proportion to housing values don't be surprised if it is about 1% .

Next , talk to a financial adviser about selling the house and investing . He will first allow for the costs of selling [ minor ] and the costs of buying when you finally decide to settle [ major ] . He will then determine your overall situation and your attitude to risk and returns . If you are super cautious [ and in some situations you should be ] he could recommend cash or fixed interest [ bonds ] that are safe and return about 6% [ but that is before inflation ] . If you are daring he may recommend growth managed share trusts which in the medium to long term [ 5 to 8 years ] return much more . Or you could settle for a diversified spread of investment risks and returns . Seeing as you should hedge against house prices rising a managed property trust such as Australian Unity Property Security Growth Fund may be appropriate . This fund has returned better than 20% per year for some years , but remember that past performance is not a guarrantee . You will note that the longer you travel the easier the investment scenario becomes , partly to provide for markets rising and falling and partly to spread fixed costs such as stamp duty on your next house over a longer investment period .

When your financial advisor has come up with a plan , take it to an independant advisor for comment .

Talk to as many knowledgable and experienced people as possible . This forum is an excellent place to keep coming back to as you see the need for specific advice on detail .

Note that I haven't said sell or not sell the house . There is a lot of ground to cover before that decision is to be made .

Never sell real estate unless you REALLY have to. And even then think twice about it. I would venture to say that most people on this forum who have sold property in the past, wished that they hadn't. Unless of course you sell and upgrade to another property.

NEVER sell your primary place of residence. Sell a kidney or peddle your ring in Kings Cross if you have to, but hang on to your house.

A 'life on the road' sounds great, but the novelty will wear off in time. Perth house prices increased by an average of 37% in 2006, work those figures out.

thanks everyone , theres some good advise there and plenty to get us thinking. thank you all..
Peter and Linda

I agree with everyone else.

I'm on the Gold Coast as well. About four years ago my brother-in law's neighbour (also Gold Coast), was offered what he though was a great price for his house. He sold and went touring for about 18 months. Came back and couldn't afford to buy back into the market. We would have needed an extra $150,000 just to buy his old hous back.

Owned his house outright before, but now lives in a much worse house with a mortgage. Had to go back to work to pay for it.

Wouldn't want that to happen to me.

My problem is I can't get the wife to even rent ours. So we do trips of 12 to 16 weeks at a time. Mostly head off for the winter and spend a lot of the summer at home or on shorter trips. Says If I get her a nice big van so she can take her sewing machine etc, she would consider it. Maybe one day, but for now I like the flexibility and rough road capability of the CT.

We bought our home in 2000 from a couple who built it as their dream retirement place, then got the travel bug and moved to Darwin to run a backpackers lodge.

3 years later they were back in Adelaide and with more money could only get a little 3 bedroom place in an ordinary location. They regretted their decision.

Pete

It may be different in other states but here at the Gold Coast and Brisbane in Qld there is a charge for water usage apart from the fee to have it available.

Imagine a family with 3 teenage kids, having to pay nothing towards the water usage.

No need to try and stop the long showers etc and the landlord picks up the bill.

That was the point in the tenant paying 80% of usage bill.

Cities don't usually have bores available, though I had one sunk to water lawn and garden.

Pedro

Forget the garden, its the water used by kids in showers etc which if tenant does not need to pay for then you have no control over what they use, and you pay the bill.

Pedro

Hi Kampen,
I also live on the Gold Coast and my advice would be to hold onto your house and rent it out.There was a prediction by a property expert,on the local radio last week,that residential properties here are expected to increase in value by about 50% over the next 4 years.We have several cheap rental properties which have tripled over the last 10 years and dont look like slowing up.Just get yourself a good real estate agent to manage your property while you travel.There are over 12000 new residents moving here every year and there is a shortage of good rental properties.You may be quite surprised just what your home is worth.