Getting the kids on the housing ladder.

Dex58

I have two children who are now young adults.There is very little prospect of them ever being able to buy a suitable property without help. I have no significant savings to assist. But I have equity (I estimate £350,000) in my house and a reletivley small and decreasing mortgage. What can I do to help? I know I could remortgage and release money to assist with a deposit. The idea of taking on a bigger mortgage at the age of 54 is a little daunting but I'm prepared to do it. But is there a better way? Would it be practical or sensible to buy two properties and rent them to my kids to cover the mortgage repayments, with a view of them buying the properties from me in the future at the same price I origionaly paid? I'm not interested in making a profit just covering my costs and using some of their inheritance early to help them while I'm still around. Any ideas or suggestions would be appreciated.

FATBALLZ

Couldn't you downsize/move to a slightly more downmarket area? £350k even these days buys quite a bit of house. Then with the released equity give them help towards a deposit.

Good on you by the way for trying to help them.

Fire_Fox

Have you children managed to say a decent whack towards a deposit and costs of purchase? If not can they really handle a mortgage, insurance, service charges, renovation and maintenance costs? Would they have rainy day savings if they fall ill and cannot work or get made redundant? Would you be willing to act as guarantor on their mortgages?

If you purchase two BTL properties lenders will probably prohibit you from letting to family, and your children could not claim housing benefit should they need to (contrived tenancy). Furthermore you selling them at a discount/ gifting at a later date could be deemed deprivation of assets from the POV of you needing any benefits or time in a care home (a long way off!). Also you would be liable for capital gains tax at the future market value.

olly300

The other 2 posters have the right idea.

1. Look to down size to a smaller property that you would be happy to spend your retirement in. The advantage of doing this now when you are fit and healthy is if you do get older and frailer you shouldn't have to move again.

2. Wait until your kids have shown that they can save and are responsible. Yes they may have to spend some money on renting to prove they are capable of doing so, but there is no point in helping them if they are going to p*ss your money up the wall.

I owe one of my relations' some money and while he doesn't want it back I know it will help his kids. However I've been warned by other people to wait until I'm sure the kids will not p*ss it up the wall until I give it to them.