Renting to relatives

leftatthelights

ecclescake wrote: »

thank you for all your responses... I agree that it has the potential for family fueds.. at the moment they have moved in with us which is even worse I think.. renting in our area is a nightmare and they just cant get onto the property ladder.. we are going to rent it with a full and legal tenancy agreement that is fixed term so that we can review and renew on a regular basis should circumstances get tricky... but we have made it clear that if payments arent made then they will have to return to live with us..
I just wasnt sure about the housing benefit side of things so thank you to those who have shared that info.

"but we have made it clear that if payments arent made then they will have to return to live with us.."

That just sounds like there a no concequences for unpaid rent??
You should be saying, "if you dont pay your rent and keep to your responsibilities then you are out on your ear!!"

You have to be tough but fair with this one!!

stephan1e_2

at present i rent from family and for the most part it has been smooth going but bear in mind you son will expect the same from you as from any other ll i.e repairs done on time.
personally i wouldn't do again (caused so many problems but i have been given notice to leave at the end of this month ( its joiintly owned between my dad and aunt and aunt has decided she wants to sell) but it was the only place i could get at the time.
also speaking from experience please do not use their house to store stuff (my garage looks like a furniture warehouse thanks to my uncle), and if your popping round for a cup of tea do not inspect the place (many an argument was caused between myself and last housemate by family doing this)
at the end of the day only you know your son and his other half but i agree with the previous poster when they said they are out on their ear make it clear there will be no coming back to live with you.
also hb will want to know if you have rented this property before /tried to rent or at least they did with me
all the best with your decission

ecclescake

Thanks everyone.. really helpful to have views from experienced people. We would never put our son 'out on his ear' because I know that if he couldnt pay the rent it would be extreme circumstance.. we said that they would have to return to us and that the property would have to go onto the rental market. We are going to have full rental agreement drawn up before they move in and have asked for 2 months rental deposit in advance.
Its soul destroying when your children cant get onto the market despite working hard and the property rentals in our area are awful (most go as holiday lets) and very expensive..their last rental was so expensive and damp, night storage heaters, massive parking issues (he has a work van with tools) and loads of hassle.. we can't watch him giving all that money to someone else..

thanks 'ericonabike' we seem to have been in the same scenerio!

theartfullodger

ecclescake wrote: »

Thanks everyone.. really helpful to have views from experienced people. We would never put our son 'out on his ear' because I know that if he couldnt pay the rent it would be extreme circumstance..

There is a fundamental rule if you ever start letting: Only let if you are prepared to evict (legally, following all the right procedures) the tenants if things go wrong. Otherwise you are writing a blank cheque, and saying goodbye to you property.

Encourage him & help him rent somewhere else, do not stand as guarantor (that really really really is a blank cheque) but please, reconsider you plan...


Hope it works out, hope the lad does well..


Artful

looktothefuture

We "rent" off my SIL/BIL. This home is where my partners grandparents first moved to when they were married, it passed down to my MIL, and now to us! My sister in law bought it off the council so that Mum could live out her life here - and she did. When she passed away very unexpectedly, none of us wanted anyone else living here so my SIL suggested we move in. God it was hard at first but now this is home (however my mobile doesn't have a "home" telephone number... it's still "Mum Home") and I couldn't honestly see ourselves living anywhere else.

I will back up the other poster who said do not use the home your son will be living in as a place to store things - we have the same problem. Also don't inspect rooms etc when you visit - it's not fair - we have the same problem.

Rent/rental agreements all need to be above board and are legally binding so all the usual procedures apply with payment of rent/eviction/upkeep of the home/fixing of anything broken...

theartfullodger

Herewith from the wonderful Shelter website the rules of HB/LHA & renting from family members...

http://england.shelter.org.uk/get_advice/paying_for_a_home/housing_benefit_and_local_housing_allowance/housing_benefit_if_renting_from_a_family_member

josie

ericonabike, you sound like you've checked it all out and got everything in place, so I say, why not? A lot of parents do this for kids going to uni and it works out fine. One thing, though, I hope you've actually got a mortgage on the property you're renting to your son and not just on your own home, otherwise you're missing out on a huge chunk of tax relief! You're able to offset mortgage interest of the property you're letting but not off your own home.

theartfullodger

josie wrote: »

You're able to offset mortgage interest of the property you're letting but not off your own home.

Errr, no I think, but it's complicated. Take advice on mortgage interest relief!