Advice regarding situation - renting from parents

devildolly5

Hi All

First time posting. I was wondering if anyone had any advice regarding our situation. My OH parents inherited a house around 15 years ago. We currently rent this from them at 1/2 the rate, but have to do all the house maintenance, decorating etc ourselves so we rent without the perks of being able to call up the landlord to fix things. My OH has lived here for 17 years, me 9 years.

His Mum, who owns the house, lives around 70 miles from us and has been retired for about 40 years, and they own their own house outright.

We really want to buy our own place, but the cost of renting and fixing things makes this hard to save for a deposit. My other half has been promised this house in their will so here is the problem.

We are trapped in a too small house in an area we do not want to live in, costing us the same as a mortgage would. His Mum has always said she would sell if we left as she doesn't want the hassle of renting to strangers.

We have recently asked if she would be willing to sell the house and give/loan us some money for a deposit. She would not lose out on rent (1 reason she gave for not wanting us to leave and for which we felt guilty about leaving and so left it for a while) as she would have a lump sum of £200,000 after lending us some cash. My OH is more than happy for this, rather than potentially have to wait 20 years for the house in the will, where we will have to sell it anyway to pay IHT.

We got valuations on the house and she seemed keen. Then she found out she would need to pay £30k in capital gains tax, and all has gone quite. We cant stay here as we want to start a family and there is no room for this here, we cant save as the house is costing us, rather than the landlord, a fortune to keep and I cant keep pressing her for an answer. It is a horrible situation as we now feel we are completely stuck. I am also concerned that if his parents health deteriates anymore, they will have to sell the house we live in to pay for care as it is still her asset at the end of the day, thus leaving us in the lerch.


Any advice or people who have been in a similar situation.

Many thanks

Emmzi

Go and rent somewhere else with less maintenance costs in an area you do want to live in while you save for a deposit, and stop relying on other people?

Mum can then rent at market value or sell, her choice.

cattie

You say you're renting the house at around half the market rent, so I don't understand even if you do have to pay for maintenance and decorating yourselves, why you can't afford to save for a deposit? Maintenance shouldn't cost an awful lot on a house, not enough to stop you saving at least.

I'm from a generation where it was common for private tenants to be responsible for general maintenance and decorating, LL only to cover major works required, yet we, and many couples born in the boom years were able to save for deposits on our first homes while paying rent.

Perhaps you need to go over to the Debt Free Wanabee board to see if you can cut your outgoings?

Other than that, if you feel you can find somewhere cheaper to live in an area you'd prefer to live in, then just move out and MIL can then decide what she would really like to do with house.

devildolly5

Thanks. By maintenance I mean brand new kitchen, new carpets etc. the house has not been decorated at since 1980's. We are expected to save to pay for these things. Agree about renting elsewhere but have looked into that and the sums just don't add up. Thanks for advice anyway.

DELLBOY_2

why would you want to buy the house as you dont like the area and say its too small to stay there

Judith_W

I would agree that although it is a great incentive that you are going to get the house eventually, you need to cut ties and find somewhere you can afford to rent in an area more to your suiting.

gravitytolls

DELLBOY wrote: »

why would you want to buy the house as you dont like the area and say its too small to stay there

Agreed, I found the OP rather confusing.

I imagine it was your choice to install a brand new kitchen, and in a small place, didn't have to cost lots, ditto decorating, you'd expect to paint in rented anyway, albeit own brand magnolia, which is presumably what you did in your current dwelling. Or did you spend lots as the elderly parents were leaving it to you in their will?

Anyhoo, if it's too small, move out, if the rental terms don't suit, move out.

Ah, I see a problem, if you've not managed to save a deposit, despite paying half rent (and on a property worth £200,00, the saving must be pretty darn good, one year's saved rent alone should've covered a kitchen and dec), perhaps you don't have a deposit to move to another rented house?

Idiophreak

DELLBOY wrote: »

why would you want to buy the house as you dont like the area and say its too small to stay there

They don't want to buy the house...they just want the mum to sell it so she can lend them some money.

Sorry to say it, OP - but it really doesn't sound like you can afford to buy. If you can't manage half rent + maintenance, I don't see how you could possibly afford full rent + saving a deposit.

It seems to me that you want your MIL to give you an easy way out...but I imagine that's what she thinks she's been doing for long enough. Maybe give up on buying and just find a private rental more suitable to your situation...

xylophone

Why not move to an area of your choosing? MIL will sell (or so she says) and cannot avoid paying the CGT.

She will then have a large capital sum - presumably she will wish to see a return. This would be your chance to offer a better return than she could get from a bank/building society?

Idiophreak

devildolly5 wrote: »

they will have to sell the house we live in to pay for care as it is still her asset at the end of the day, thus leaving us in the lerch.

I'm unclear if you mean that you'll be left in the lerch by being kicked out of the house you're renting cheap, or left in the lerch by losing out on the inheritance that you seem to be counting on quite heavily...

devildolly5

Why not move to an area of your choosing? MIL will sell (or so she says) and cannot avoid paying the CGT.

She will then have a large capital sum - presumably she will wish to see a return. This would be your chance to offer a better return than she could get from a bank/building society?

She wont sell because of the CGT, and our rent is a source of her income. She wont rent to strangers, so we feel some guilt at just leaving.
I am not counting on Inheritance at all. I dont want to do it this way. I want to earn my own house thanks.

My meaning at being left in the lurch...She is positive that my OH will get the house, and that life is that straight forward, but his parents have never considered the fact the healthcare costs are expensive and have to be paid yourself if you have assets £28K+, so if required, she would have to sell the house we live in to pay for this, so in reality, I do not think there will be a house to inherit, so we want out while we can.

Also, half rent...we did not choose this house, and is in a relatively expensive area, so half rent is still expensive.


I am obviously coming across wrong in my posts (as a moneygrabber) which is not my intention.