Perils and pitfalls of renting from a friend??

Miró

My sister is retiring shortly and is looking to move to rented accomodation with a view to staying put indefinitely. She currently rents from a Housing Association but wishes to move to a better area. A long-term family friend has offered to buy a property, (to her liking), which she could rent from him at below the market price and similar to what she has been paying to the Housing Association. As a start they are viewing a property tomorrow which is on the market for £250,000, (2 bed, 2nd floor recently modernised flat, overlooking parkland on outskirts of Harrogate Town Centre), owner purchased for £175,000 just 2-3 years ago. (I believe the intention is to get a 50% mortgage) Although it appears to be a very generous offer from the family friend I am wondering what the problems might be from such an arrangement. I should imagine that the arrangement would be sorted out on a proper and business-like footing but I really do not think that either of them have really thought the matter through properly yet. Security of tenure is of the utmost importance. The family friend is a solid, reliable sort looking to invest a small part of a large inheritance. He is divorced with 3 grown up children and presumably his estate will be left entirely to his offspring.

Does this sound like a viable venture?

Is there any way of making sure that my sister would be secure in a long-term tenancy with no nasty surprises arising in the future?

What would the likely (full) rent be on such a property?

My sister and I have no experience of private sector renting so would appreciate any thoughts regarding this matter.

Thank you

poppysarah

She'll never be as a secure as in a housing association property. Once you've lost that you're out in the cold and may never get a HA place again.

Friends often fall out about money - and this is a lot of money.

Miró

poppysarah wrote: »

She'll never be as a secure as in a housing association property. Once you've lost that you're out in the cold and may never get a HA place again.

Friends often fall out about money - and this is a lot of money.

Thank you....those are my feelings exactly! I just wondered if there was any way of getting things on a legal footing that would offer some security of tenure?

Actually she has been offered a move to a Sheltered Housing HA property but the standard of accomodation no way compares and she says she is not ready for Bingo Nights & cocoa yet!!!

ryandj

I would worry about them charging you "below market" rents - I am sure the kindness of their heart will only stretch so far before they realise that they would get a better return on investment by renting it out at market value. You would then either have to move out or pay more rent.

There is not really any long term tenancy assurance in the private sector as far as I know.