Foreign Perspectives

Archive for the ‘Australia’ Category

We’ve been investigating how our banking, investments, savings, pension, and mortgage will work when we move to Australia as we can explore that now rather than wait until everything is happening at once.

Banking turns out to be relatively simple. Many people will use Wise initially which, although not an actual bank, will give you local account numbers in both the UK and Australia. Although both will work for the usual direct debits, payments, and debit card transactions, the Australian one has some limitations, specifically it can’t be used to receive social security payments. However, much better is the HSBC Australia Everyday Global account which is a proper Australian bank account and is the only Australian bank that let’s you fully open an account from abroad (tell them that you’re using it for saving, NOT that you’re going to be moving there); the debit card arrives in a couple of weeks. Although you don’t have to have an HSBC UK Advance account, if you do, you can do instant transfers from it to your HSBC Australia account. The other plus point of this is that HSBC UK will let you keep that account when you’re living in Australia. Transfers in the reverse direction take a day or two unless you have HSBC Premier. You need to use the HSBC Australia account every month or two so that it doesn’t go dormant.

Savings are more tricky as many banks and building societies will require you to close your accounts when you move abroad. Notable exceptions to this are the Nationwide, HSBC, Lloyds, and RBS/NatWest. If your cash ISA is with one of these, you could keep it but a) can’t add more to it and b) the interest will be taxable in Australia as they don’t recognise ISAs. The same mostly applies to investment ISAs and investments generally.

Banking in Australia is a bit different. When you move, you’ll find that many of the UK banks and building societies will close your account so you want to have one or more of the above opened before you move, as you’ll not be able to open them afterwards. As you’ll notice, those I’ve mentioned above are legacy banks and in practice most (all?) of the fintech banks (Kroo, Monzo, Starling) will close your account. If you fancy a fintech in Australia, there’s UBank and Up, but you can’t open those until you are an Australian resident.

Pensions are rather more complex. Due to HMRC requirements, if you are going to transfer your pension then it can only be to an Australian SMSF which is QROPS compliant which in turn means that you’re looking at setup fees of around £2000 and similar annual fees after that. The maximum that you can transfer in this way is A$120000 (£60000) per year (potentially triple that in your first year). Alternatively you could just access your UK pension from Australia and simply declare the withdrawals in Australia (they’ll generally be subject to Australian income tax as if you tell HMRC that you’ve left, they won’t apply UK tax). Given that my UK SIPP costs all of £120/year, my current thinking is that I will just leave it in the UK and make withdrawals as I’d have done if I’d still been in the UK. One thing to note is that you don’t need an international pension and any place that seems to offer one is likely a scam. That said, some normal SIPPs come in a rebadged international version so, my one with AJ Bell does, but it’s just the same with a different name on the tin. You can only transfer defined contribution schemes, not final salary ones nor your UK state pension. If you tell the state pension people, they can pay your pension to an Australian bank account in Australian dollars, or you can get it paid into a UK bank account. As I say, this is a complex area and you’re going to need advice on this.

Credit cards are something that you may want in Australia, however you won’t have a credit history when you turn up obviously and therefore will likely get rejected when applying. Two ways around this are to open an American Express card in the UK before you leave and use their Global Transfer service (basically you apply for a card in Australia and in the application check the box that says existing customer and you should be in business. Their Australian cards mainly come with a fee and to my mind, the best currently is The American Express^® Platinum Edge Credit Card which is A$195/year after the first year but comes with enough supermarket discounts to, for me, cover the cost. If you don’t want a fee, there’s The Qantas American Express Discovery Card and The Low Rate Credit Card. Worth noting is that Amex acceptance seems much lower in Australia than it is in the UK. The other way around no credit history is to apply for an HSBC Australia credit card as they will check your UK credit history; their Premier card is free and their low rate card is A$99/year.

So what about a mortgage? If you’ve a mortgage on your UK home, you’ll likely have to pay that off before you go, or essentially change it into a buy to let mortgage (the interest rate will usually be about 1% higher). You seem to be able to keep a buy to let mortgage going although it’ll be a bit more complicated when you come to renewing any fixed offer that you may have and your choice of banks offering it will likely be more restricted. What about an Australia mortgage? Still to be researched more fully, but they look much the same as UK mortgages, albeit with fewer options and, of course, there’s the business of proving your income in Australia.

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The first thing to note is that Australia is big, really big. Not only is there different geography including the usual city, coastal, countryside, and mountains but there’s entirely different climates to consider too. So, for example, if you’re looking up north around Darwin you can have monsoons, around Alice Springs you’ve got major heat in the summer, and in Tasmania you’ve basically got a normal (for UK people) climate. Hence, we’re concentrating our search in Tasmania.

In addition to a temperate climate, Tasmania has a whole lot fewer people: the population density is around 1/20th of what I’m used to locally. That different population density obviously affects the traffic density too which is obvious to me now but confused me initially. One consequence of that lower traffic density is that you can expand the radius that you’re considering for a property. In my initial searches, I used distance as the decider but it turns out that you can drive a whole lot further in twenty minutes in Tasmania than you can in twenty minutes in Belfast.

Unless you’re planning on living in the wilds (of which there’s a lot in Tasmania), there’s essentially two major population centres: Launceston and Hobart. Hobart is the capital and we found that there’s a lot more traffic there than there is in Launceston, as you’d expect from the larger population (about 200,000 vs 80,000). This is also reflected in the house prices: something that would sell for around A$700,000 in Launceston is more like A$1,000,000 in Hobart. That said, if you drive just ten minutes further out of the centre, an equivalent Hobart property is down to A$800,000 or so: it surprised me no end how much the prices changed if you added an extra ten minutes distance.

So, what are we looking for? Well, we have two slightly conflicting objectives in that Wendy and I will be retiring, whereas the boys will be looking for work, which means that we can’t be too far from their employment, hence our searches are looking for somewhere within about 30 minutes drive of either Launceston or Hobart. We’d also like somewhere with “a bit” of land so, notionally, minimum of a couple of acres, but not loads of acres, although we’ve found that isn’t as cut and dried as it first appeared as, for example, 100 acres of forest is probably easier to look after than 2 acres of landscaped garden. We’re not moving for about two to three years, so the prices will obviously have changed over that time but we’re using as a rough guideline A$800,000 as our maximum. Interestingly, when we were looking up to April, we seemed to need that A$800,000 but looking in July we found a number of suitable properties around A$600,000. Other than that, we’re just looking for three bedrooms minimum but even that’s not so clear-cut as you’d expect as Australian homes come with the usual bedrooms, kitchens, bathrooms, living rooms that you’d expect but also things labelled “study” (which could equally be a bedroom), rumpus rooms, entertainment rooms, workshops, storerooms, and a whole host of other categories, many of which I’ve never heard of.

They have open viewings in Australia so we were able to visit several properties whilst we were there (you can search for these via https://www.realestate.com.au/buy/inspection-times-1; they appear up to a week or so ahead). One thing that was clear right away was that the estate agent descriptions were very accurate, but equally clear was that we also needed to know more about the surrounding area of the property that we’d be buying. To partially get around that, you can use satellite view and street view on google maps, which we were doing, but it’s a lot clearer when you’re driving up to the property and having a look around. For example, one property we went to see was just hemmed in between two others and the back garden was pretty much a sheer drop, neither of which were obvious from our online investigations. Equally though, another property has what’s essentially a small national forest in its back garden which was beautiful but not at all obvious from the estate agent description or photos: in fact that property was one we’d buy if this were two years from now, yet, ironically not one that we’d have looked at buying.

What we’ve been mainly using to do our searches is https://www.realestate.com.au (that link takes you directly to one of our searches). There’s also https://www.domain.com.au/ but we found that the facilities on it weren’t so good. The RealEstate site lets you add filters, the key ones for us being the number of bedrooms, maximum price, and minimum land. You’re best to look for one less bedroom than you think you need as it will include houses with other types of rooms that you could just as easily use as a bedroom, so we actually would like four but search for three. House type is “interesting” as it’s, of course, Australian style so you’ve the usual house, townhouse, villa, retirement living, and apartment, but also acreage, rural and land which can all include houses on them. There’s also a map search option which we’ve found to be very useful as you don’t need to know what postcode areas you want your property to be in. Once we’d done a bunch of searches, we noticed that one particular estate agent seemed to turn up in a fair number of them: Neil Hawkins and, funnily enough, he was at one of the properties that we went to visit too! I suspect that’s a common occurrence in that a particular estate agent will likely specialise in the properties that you like yourself. I’m not 100% sure that we’ll end up buying our property via Neil, but I wouldn’t be surprised if we ended up doing that.

We thought at the outset that a scouting trip was essential, and it did indeed prove to be very useful. Whilst most people doing that kind of thing stay in a hotel and then just scoot around the areas that they’re interested in, we chose a self-catering property in an area that we’d previously been looking at for properties. That gave us the opportunity to get a feel for what it might be like living there and the boys pointed out later that it felt like we were living there. For Tasmania, that was Cherry Top Farmstay which is on the edge of Lilydale. It turns out that Lilydale did indeed feel like the kind of village which we’d want to be close to (we don’t want to be in a village though) as it has all the services you need i.e. decent supermarket, post office, medical centre, a small group of takeaways, coffee shops, a tavern, a petrol station, a school, and even a swimming pool. We were there for almost two weeks and were able to cover just about all the things we were aiming to do so we checked out how to sign up for Medicare, change the driving licence over, and saw round a number of other areas that we’d been considering. That said, there were a bunch of things that we couldn’t fit into the time available and we’d have needed at least another week. We’d also have liked more time to explore round Hobart as the two days didn’t really cut it, although it did highlight some negatives (the traffic) and positives (Cygnet). Our trip also had the advantage of highlighting some things that we particularly liked such as the small village feel of Lilydale and put us off Sidmouth a bit as it doesn’t seem to have that, although on paper it seems to.

As I say, we’re aiming to move around 2027 or so but we’re going to continue to look now and again as we build our evidence for my visa application that, all being well, we’ll be submitting late 2026.

Copyright © 2004-2014 by Foreign Perspectives. All rights reserved.

It’s been a while since the last post here! Turns out that home schooling plus real life plus blogging would require more hours in the day than there are available.

For those missing the final couple of segments of the psychology notes, they’re coming over the next few months.

So, we’re preparing for another international move, to Australia this time. We’re just back from our initial scouting trip which let us look at a few potential locations and an initial look at a few houses that would be along the lines of what we’re hoping to buy in due course. Moving to Australia is a bit more complicated than moving to France was as we (well “I”) need to apply for a visa rather than just turning up as we did when we moved to France.

We started preparations late last year when I created my IMMI account (https://online.immi.gov.au/lusc/login) which is what you use to apply for an Australian visa these days. Unfortunately, there’s no option to produce a printed version of the form so to find out what documents and whatnot you need, you’ll need to go through the whole application adding in “to be added later” or the equivalent in the various text boxes. And, there’s a LOT of information and documents that they want!

One issue that we noted as we moved through the form and looked at what others before us have done is that it’s largely geared up to couples that have been together for a couple of years and, paradoxically, much harder if you’ve been together for 20+ years as we have been. Now, I know you’re thinking that “hey, we’re married and have a couple of kids, it’ll be easy”. Nope. Each child you have just proves that you were together one day nine months before they were born, similarly for that marriage certificate. What they’re looking for is evidence that you’ve been together continuously for all those years, right up to the point when you submit the application. So, for example, the “relationship history” that you each need to write needs to cover the period from when you first met, all significant events since then, right up to the day you hit “submit” on your application.

In practice, we have found that we’re going to need to create the evidence because we haven’t been saving it up all those years. Seeing as they will be looking at this blog as part of the evidence: dear immigration officer, I know that sounds really bad, but honestly we’ve been together for over 20 years as you’ll see from this blog!

The immigration people like to see that you’ve been on holiday together which you’d think would be a doddle to prove. However, it turns out that the airlines don’t keep records going way back and we only have insurance for one holiday naming all of us because we’re on the Nationwide insurance now and it doesn’t work as proof. Accommodation booking only take the name on the credit card so are no use either. Photos sound good, but although we’ve heaps of photos, we’ve very few with both of us in them and have been making a point of doing joint selfies lately to start creating that evidence.

Copyright © 2004-2014 by Foreign Perspectives. All rights reserved.