Renting Your Property While Living Overseas

If you are shifting to another country for a better job opportunity or for any other reason and want to rent your property in Melbourne or in some other place in Australia, you can easily do so. In fact, we would say that keeping your property in Australia and renting it while staying overseas can be a sensible option to explore. So, if the question of how to rent my property while living overseas worries you, read on.

Do Rent My Property 

At Besser & Co, we have helped several Aussies with this, and we can tell you a thing or two about becoming an overseas landlord. Renting your property in Australia while staying overseas may cover your mortgage payments, council rates, and body corporate fees, with potentially some leftover to help fund your overseas lifestyle. 

Moreover, your property has more chance of staying protected when it is on rent. Empty houses are like magnets for trouble. Break-ins, vandalism, or just the general deterioration that comes with neglect have a greater probability of occurring in a vacant house. Having good tenants in your place means someone is there to notice if the gutters need cleaning or if a leak is developing.

Keeping the property in Australia while exploring new horizons overseas can help you get the property’s value appreciated over time. This is especially true if you have a property in a place like Melbourne, where real estate value keep on increasing. 

Besides these, keeping your property in Australia and putting it on rent while staying overseas can be especially helpful if you intend to come back to Australia after a few years. This would safeguard you from exploring the property market of the country afresh after your return to Australia.

The Legal Requirements

However, there are some legal requirements you have to fulfil for being eligible to rent out your property in Australia while staying overseas. To be more specific, we are focusing on the legal requirements for Victoria only.

You Need Someone on the Ground

Victorian law says if you are living outside Australia, you must appoint someone to represent you. This could be a family member, friend, or (much better idea) a professional property manager.

Now, unless the concerned person has experience with the Residential Tenancies Act and knows what to do when the hot water system gets disrupted at 10pm on a Sunday, you might want to think twice. 

Professional rental property management companies take care of all this stuff, so you can focus on enjoying your time abroad rather than stressing about tenant issues.

Meeting the Standards

Since 2021, rental properties in Victoria need to meet minimum standards which include proper heating in the main living area; secure locks on doors and windows, adequate ventilation and insulation, regular safety checks for electrical, gas, and smoke alarms.

If your property falls short of these requirements, you could be facing penalties or disputes with tenants.

The Money Talk

Here’s where things get slightly complicated. The tax implications of being an overseas landlord in Australia can seem to be a bit of a minefield to a lay person, so let us break it down.

Your Rental Income

Any rental income from your Australian property is taxable in Australia. Yes, even if you are living in London or for that matter anywhere else in the world, you’ll still need to lodge an Australian tax return.

The good news is that in exchange of that you can claim heaps of deductions, which include: 

• Mortgage interest
• Council rates and strata fees
• Repairs and maintenance
• Property management fees
• Depreciation on fixtures and fittings

So, if your property brings in 70,000 AUD a year in rent and your expenses in maintaining the property are 28,000 AUD, you are only taxed on the remaining 42,000 AUD.

Non-Resident Tax Rates 

Here is where it gets a bit painful – as a non-resident, you don’t get the tax-free threshold that residents of Australia enjoy. You will be taxed on the first dollar, often at higher rates too. Non-residents currently pay 32.5 per cent on the first $120,000 of income, compared to residents who pay on their first $18,200. 

Double Taxation Treaties

You need to know that Australia has tax agreements with many countries to prevent you from being taxed twice on the same income. If you are living in the UK, for example, tax paid in Australia might offset some of your UK tax obligations. Definitely worth chatting to a tax specialist about your specific situation.

Capital Gains Tax Considerations

If you are thinking about selling your property down the track, here is something crucial to know – non-residents in Australia can no longer claim the main residence exemption for capital gains tax. 

This could mean a substantial tax bill if your property has increased in value since you bought it. It is worth getting advice before you head overseas to understand your options.

Other Factors to Consider 

There are several other factors to take into account if one intends to have peace of mind in renting one’s property while staying overseas, some of which are given below:

Finding the Right Tenants 

One of the biggest concerns we hear from overseas landlords is: “Who’s going to be living in my home?” It’s a fair worry – your property is probably your biggest asset, and you want to make sure it is in good hands. The proper tenant screening is very much important in this regard. 

Without proper screening of tenant/s you cannot be sure of getting paid rent on time, having your property well-looked after and of preventing nightmarish disputes.

At Besser & Co, we don’t muck around with tenant screening. We check national tenancy databases, go for potential tenants’ employment and income verification, his/her previous rental history. We also carry out comprehensive reference checks of potential tenant/s.

Rock-solid Lease Agreements

A good lease agreement is like a good insurance policy – you hope you never need it, but you will be damn glad you have got it when things go pear-shaped. It should cover everything from rent amounts and payment schedules to maintenance responsibilities and rules about pets.

Insurance 

Your standard home insurance won’t cut it once your place becomes a rental. In that case, you need specialist landlord insurance that might cover lost rent if tenants run away without paying rent, damage caused by tenants (whether accidental or deliberate), public liability if someone gets hurt on your property, and legal costs for tenant disputes.

For overseas landlords, this insurance isn’t optional – it’s absolutely essential. It is your financial safety net for problems you can’t handle in person.

Communication Across Time Zones

Managing tenant relationships from overseas could be tricky. Different time zones mean that urgent repair requests might come through when you are deeply asleep.

This is where professional property managers earn their keep. At Besser & Co, we handle all tenant communications, provide detailed monthly statements, conduct regular inspections with photo reports, arrange repairs quickly and cost-effectively and keep you informed without overwhelming you with every minor detail.

Thus by hiring us, you can get peace of mind about your home in Australia while staying overseas, and your tenants can get prompt, professional service, even if you are not in the country.

Points to Ponder 

We have seen plenty of overseas landlords learn the hard way. Here are some of the steps a property owner staying overseas but having property/ies in Australia should take.

Do not rely too much on friends and family. Your friends and relatives are not expected to be experts on tenant laws and may not be adept in handling emergency repairs at 3am.

Don’t ignore the safety compliance, for doing so can lead to imposition of fines. Neither do overlook your tax obligations. The Australian Tax Office will not forget about you just because you are staying overseas.

And never skip on landlord insurance. Doing so is similar to driving without insurance – you might get away with it, but if something goes wrong, you are in serious trouble.

Choose the right property manager to get the rent you deserve and to avoid the hassles you don’t deserve.

Your Questions Answered

Yes, there might be several questions disturbing you as you are thinking of renting your property while moving overseas, and here we try to resolve some of them.

Can I do short-term rentals like Airbnb? 

You can, but short-term rentals come with extra council regulations and body corporate restrictions. Most overseas landlords prefer the stability of long-term tenants.

Who pays for repairs when I am away? 

You are still responsible for repairs as the landlord. Your property manager should handle arrangements, using rental income or your reserve funds.

Do I still pay rates and body corporate fees? 

You need to address these, as these remain your responsibility, though they are tax-deductible expenses.

How often can I increase the rent? 

Generally, once every 12 months, with proper written notice.

Why Besser & Co is Different

• Expert tenant selection that minimises your risk of problems
• Proactive maintenance that prevents small issues from snowballing into big headaches
• Transparent, detailed reporting so you always know what is happening
• Current market knowledge to ensure your rent stays competitive
• Complete legal compliance so you can sleep easily.

We look after your property, endeavour to maximise your returns from the property, and let you enjoy your overseas stint without undue property-related stress.

Ready for the Plunge?

If you are thinking of renting out your Melbourne property while living in Paris, we would commend you on your financial acumen. With the right legal compliance and professional support, your property can give you a steady income and also appreciate.

At Besser & Co, we specialise in making overseas property management seamless. Whether you are looking for your South Yarra apartments for rent, or intend to put your family home in Preston on rent, you can rely on us to deliver the results. 

In case you are planning to move overseas, accompanied by the nagging worry of what to do with your property in Victoria,  get in touch with us today. After all, life is too short and too valuable to spend it worrying about property management from thousands of miles away.

FAQ

How can I remotely manage my rental property?

One of the effective ways of managing a rental property remotely is through a trusted and efficient property manager who is expected to handle tenant’s/tenants’ problems and grievances, if any, maintenance issues, and legal compliance on your behalf.  

In Australia, do I need a property manager if I rent out my home while living overseas?

In Australia, you must appoint a local representative or property manager if you intend to place your home on rent while living overseas.  A professional property manager is preferable over a friend or a family member acting as a local representative. A licensed property manager can help ensure your home meets its legal obligations and is properly looked after in your absence.

In Australia, what paperwork or permissions are needed if I want to rent my property from abroad?

A signed tenancy agreement, bond lodgement with the RTBA, and compliance certificates for safety checks are the necessary requirements for renting of properties, in Australia. If you are renting from overseas, you need to also appoint a local property manager or a representative in Australia to handle all legal requirements.

Can I rent out my property on a short-term basis in Australia, while living overseas?

Yes, while residing in a foreign country one is entitled to rent out his/her property in Australia on a short-term basis provided the council regulations, body corporate rules, and tax obligations are in place.

What are the risks of renting my property while I live abroad?

Disputes with tenant or among tenants, the risk of damage to the property, the possibility of rental arrears, and compliance breaches are some of the risks associated with renting your property while living abroad.