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o0 ecdysis 0o
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Advice Needed: International Work Assignment - NOLA Home Decision
TL;DR: asking advice from the internet on what to do with our NOLA home while on an international assignment in the Middle East for 4 years.

My wife and I (and our toddler son) have been lucky enough to have been chosen for an international assignment with our company in the middle east (Oman). We'd move at the end of the year for a 4 year assignment. We own a home in Uptown NOLA (purchased in 2009) and are trying to figure out what to do with it.

Purchase price ~$400k; current conservatively estimated value is between $650-750k. Outstanding mortgage balance is $380k after refinancing 3 years ago to extract equity for some needed improvements.

An important consideration is that we're unlikely to return to NOLA after these 4 years -- maybe only a 10-15% chance. More likely scenario is that we'll pickup another assignment somewhere else, or relocate back to NOLA and then immediately to Houston within a month or so (Oil & Gas employer).

We've evaluated our options as follows:

Option 1 -- Sell the home.
Option 2 -- Pickle the home
Option 3 -- Short Term Rental (AirBnB)
Option 4 -- Long-Term Rental (Yearly tenant)

Originally we leaned Option 3, as we like the idea of having a home to come back to when we visit each year, or in case there's a geo-political reason we must return (e.g., war with Iran). But after giving it some thought and thinking about the financials, I can't get over the idea that prices in NOLA are high, with low interest rates, and, because we won't have been using it as our primary residence for 2 years (over the 4-5), we would be dealing with taxation of the capital gains when we do eventually sell….this is making us seriously consider option 1.

What say the sages of Money Talk?

Please let me know if you need more information. Happy to provide.


tigeralum06
LSU Fan
Member since Oct 2007
2124 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sell. Tax free gain you can then invest in the market.



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90
cave canem
Mississippi St. Fan
pullarius dominus
Member since Oct 2012
11421 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sell it ASAP

To be clear, in 11 years you have manged to pay off 5% of the purchase price and THINK it may be worth far more.

Time to find out if you are right because IMHO you should never carry the sunk cost of interest, taxes, insurance, and utilities etc for 4 years if you do not plan on returning, far to may things can change in the meantime.


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61
hungryone
LSU Fan
river parishes
Member since Sep 2010
10924 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sell, assuming you can actually get the price you think.
I wouldn’t want the hassle of short term rental management when on the other side of the globe.


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43
GulfCoastPoke
Oklahoma State Fan
Port of Indecision
Member since Feb 2011
953 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
I’m moving to Dubai with my family in 10 days.... and I’m jealous you’re moving to Oman.


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Twenty 49
LSU Fan
Shreveport
Member since Jun 2014
12877 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
I would sell. Can't imagine the stress and hassle of owning a home on the other side of the world that tenants are in.

Imagine an email from the tenant that the AC has gone out or the water heater flooded the place, or the roof is damaged by hail. Or the tenant defaults on the rent and needs to be evicted and any damage to the house assessed and repaired.

Dealing with that from loooong distance would not be my cup of tea.


LSU1018
LSU Fan
Baton Rouge
Member since Feb 2007
6851 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sell then buy something close to where you are moving to for a rental if you just want to get into that.

It’s too tough to maintain a rental when you are that far away. Most things in NOLA are older so they require more upkeep also.
This post was edited on 2/28 at 5:48 am


o0 ecdysis 0o
LSU Fan
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Member since Nov 2005
1079 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Thanks for the responses so far. This is very helpful.

In terms of the short term rental, the attractiveness has been when I run conservative scenarios. Using a high-end and reputable property management company (e.g, assuming 35% occupancy, higher-cost maintenance, and low nightly rate), I come out with about $17k annual "profit."


BlackenedOut
The Big Sleazy
Member since Feb 2011
5227 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sure, but what happens in a year or so if the City Council or Mayor does something like ban whole house short term rentals in "historically residential areas" or something similar?

Sell.


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51
Mr.Perfect
LSU Fan
Louisiana
Member since Mar 2013
17002 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Option 5 -- sell it to Mr. Perfect and avoid the real estate commissions


saderade
New Orleans Saints Fan
America's City
Member since Jul 2005
23931 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sell. No way I would want to deal with Short term rentals when I’m out of the country. Especially with the laws constantly changing in the city.


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20
o0 ecdysis 0o
LSU Fan
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Member since Nov 2005
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re: Advice Needed: International Work Assignment - NOLA Home Decision
quote:

Option 5 -- sell it to Mr. Perfect and avoid the real estate commissions


Image: https://media.giphy.com/media/10bDoTtJhtcHu0/giphy.gif


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10
LSUOFFSHORE
Nicholls St. Fan
Madisonville,LA
Member since Nov 2007
388 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
quote:

TL;DR: asking advice from the internet on what to do with our NOLA home while on an international assignment in the Middle East for 4 years.


I am in a similar situation we are headed to Kuwait, but we are planning on returning to LA

Purchase $480k
Value $500
Mort $280k

FIL has rental properties and would manage the day to day BS. Company will give 7% value to keep the house and not deal with selling.

Leaning towards keeping it.


o0 ecdysis 0o
LSU Fan
This sentence is false.
Member since Nov 2005
1079 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
quote:


FIL has rental properties and would manage the day to day BS. Company will give 7% value to keep the house and not deal with selling.


unfortunately, my employer encourages people to keep their house via not offering any help with it at all. one of the reasons i was originally keen to keep it was in case of a domestic relocation once we return, where the homeowner relocation is better than the lessor relocation (they pay closing costs). but when i factor in the tax implications, i cannot see being better off keeping it just for those benefits.


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CE Tiger
LSU Fan
Metairie
Member since Jan 2008
38859 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
if your going to the fricking middle east for 4 years hopefully it’s to be paid an OT baller salary. you should be able to afford a much nicer home when you return and will deserve the upgrade. sell the house, invest it and avoid getting suicide bombed over there. good luck


lynxcat
Rutgers Fan
Member since Jan 2008
21226 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Sell the house. This is an easy decision and it will simplify your life dramatically.


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LSU7096
LSU Fan
Houston
Member since May 2004
1010 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Does your housing allowance differ if you maintain a residence in USA?

Best to keep house in NOLA and get full domestic relocation package upon return.

WE did option 4 with severe lease restrictions and rented home for 3700/month for 3 of 5 years on our last assignment.


o0 ecdysis 0o
LSU Fan
This sentence is false.
Member since Nov 2005
1079 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
quote:

avoid getting suicide bombed over there. good luck




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o0 ecdysis 0o
LSU Fan
This sentence is false.
Member since Nov 2005
1079 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
quote:

Does your housing allowance differ if you maintain a residence in USA?


not that i can see.

quote:

Best to keep house in NOLA and get full domestic relocation package upon return.


From what I can tell, it's basically sellers closing fee's on way out + buyers closing fees in new location. assuming 3% on each side, that roughly equals my tax bill for not residing in the property while i'm gone. it's also my understanding the closing assistance isn't tax asissted...so at best i'm even.

are there any smart ways to optimize the taxation when i sell?


lighter345
New Orleans Pelicans Fan
Member since Jan 2009
11394 posts

re: Advice Needed: International Work Assignment - NOLA Home Decision
Are you keeping homestead exemption? Just making sure because without it you can’t air bomb in nola unless commercial.


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