Ask Paul: Should we sell or rent out our home to move interstate?

Q. My husband and I are in our mid-30s and purchased a townhouse in one of Brisbane's bayside suburbs in 2017, shortly after moving to Queensland.

I am incredibly homesick so am looking to move back to NSW (Wollongong) to be closer to family later this year.

What should we do with the townhouse?

We have been paying off extra amounts every fortnight but still have $362,000 left on the loan and the property is probably worth about $420,000.

We have about $30,000 in savings. Our gross annual income as a couple is about $120,000.

Would it be wise to rent out the townhouse to build up more equity, and rent in Wollongong until we can build up another deposit, etc; or bite the bullet and sell the townhouse before relocating and try to buy in the Wollongong market? - Krystle

A. This is always a bit of a dilemma, Krystle, but one thing is for sure: your life and happiness come first and money second.

So you have sorted the key issue and are heading home where you want to be.

Holding or selling the townhouse is a mix of emotion and facts.

For me, the overriding thing is the prospect of rent and capital growth on it. The rent will be easy - any agent can tell you that.

Then the capital growth will depend on the area, its desirability, plus the characteristics of your place. In the perfect world you would weigh up these factors, then do a comparison with Wollongong and buy where the returns look to be higher.

I don't know a lot about Brisbane's bayside suburbs, so I'll have to leave that to you.

But a distant rental property is not ideal.

Equally, I do know that Wollongong is growing rapidly. So as it sounds to me as if you will be back there permanently, unless you feel the townhouse is really well located, I know what I'd do. Sell and buy where I will be living.

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