Inherited property - buying out the other siblings

r8ash

Again, thanks for all your words of wisdom. I'll try to answer all the questions as much as i can. here goes.

3 bed property in need of cosmetic renovation in an area being developed around university campus, on major commuter route into london. it current state worth maybe 70-80k.

dad has been left around 10k in cash. enough for a renovation to student lettings.

if this weren't meant to make profit through sale is it worth keeping to rent to students to start building a nest egg for when he retires? or is he better off buying his own property?

He would attempt to complete the project without having to invest any further funds.

So he has 1/5th of a house and 10k to work with, is it possible?

Thanks

Debt_Free_Chick

Getting a mortgage may be possible - depends on whether he has income to make the repayments.

But if he uses his share of the inheritance to fund the deposit, does he then have the capital (cash) to fund the cost of the renovation?

andy.m_2

Cash out the whole package and then when faced with a pile of money, let your old man decide what to dow ith it.

While it is laudable that you are helping him to potentially go into business, how would you feel if he lost the whole lot at his first attempt and was left with nothing.

Also consider, as above, if he goes on to make a tidy 20/30% profit then there will be resentment from the brothers.

If he wants to do this then great, help him all you can, but distance the venture from the family as far as you can.

googler

It's getting more and more difficult to turn dev't properties round in less than 6 mths, due to lenders insisting on behalf of their buyers that, for money-laundering reasons, they won't lend on something that has been owned for less than 6....

...and time is money, as another said.

martindow

Your figures don't seem to make sense. You say that similar houses in moderate condition are worth 115 000 and value this house at 70 or 80 000. You say it needs cosmetic renovation - this will not add 30 or 40 000 to the value.

breadlinebetty

You need to get the house valued before you start making plans, it could be worth more than you think. When you ssay it needs cosmetic work do you mean just redecorating, or fitting a new kitchen/bathroom etc as well?

Also, who will be appointed to do the valuation? You need to be careful that the house isn't deliberately undervalued by an unscrupulous estate agent....

Your father then needs to find out if he can get a mortgage before you even think about making any plans. It might also be an idea to check out what sort of rental income you could expect from the house. If you're going to rent it out to students you could find they won't be too bothered about the decor, in which case you could start making an income almost straight away once (and if) it all goes ahead smoothly.

It really all depends on your father and what his brothers want to do.

V_Chic_Chick

Don't forget that if renting to students, you may well need to get an HMO licence, and you will also have to budget for buying a full set of furniture, as student houses always come furnished.

r8ash

Ok, so general opinion is to cut ties with his fathers house and look elswhere. If this house hadn't been in the family dies it have potential in the area it is in. Maybe I have under estimated the value of the house as is or underestimated the amount of work needed to get it up to scratch.

Should we completely avoid renovating a house to sell on for profit in current market, given the redevelopment of the area?

Thanks