Buying a council home but not the tenant - query!

danthedoors

My father in law (now retired) has rented his council home in London for the past 30 years. The council is soon to put up the rent to a level that will not be sustainable for them to remain there. They have been offered the chance to purchase the property for a very reasonable sum (half the market rate).

I am currently renting with a small family, unable to get on the property ladder due to not having sufficient deposit. My query is this: given I am not the named tenant, and neither is my wife any longer - having moved out of their family home 7 years ago - is it actually possible for me to apply for a mortgage and purchase the flat, and then to rent it back to my in-laws at a subsidised rate?

I don't have the money to purchase outright and my in-laws are not willing to get a mortgage themselves. Any help or insights welcomed!

Dave_Ham

I am not sure you want my insight.

No, no and no. I actually cannot believe that you would even consider that they would

BargainGalore

I cant see why you think you could have any right to a house 1/2 market value when your not even a tenant there

Knalchemist

Only if your father in law was named on the mortgage as well I believe.

NeverInDebt

Well I very much doubt you stand any chance, so what is your Father going to do given he has lived in subsided housing a long time, if he cant afford the new rent now assuming its still below market rate how is he going to survive on paying full market rate? Have you tried any housing associations?

cattie

Council rents are way below market value anyway & are heavily subsidised, but if the in laws really struggle with paying the rent, they can claim housing benefit. That's what it's there for, to help people in such a situation. No need for you to think of buying the place at a give away price, only to want to charge them a subsidised rent, which is exactly what they have actually been getting for the past 30yrs anyway.

BigAunty

Encourage your FIL to have a benefits check at the Citizens Advice Bureau or help him calculate his full entitlements on the Turn2us online benefit checker. This will indicate if he is due any pension credit, housing benefit or council tax discount.

If he has been hit by the spare room subsidy/bedroom tax because he has unoccupied bedrooms, the council should help him discuss his options which include things like taking in a lodger or moving to a smaller property - perhaps he qualifies for a move to elder/semi sheltered housing. Sounds like this could be the case if you've got your eye on it as a family sized flat. Many councils operate incentive schemes to encourage those with large properties to downsize to smaller ones.

The problem with your proposal is I believe an occupant who is not the named tenant has to prove they've lived there at least 12 months before exercising RTB and an elderly person with low income will struggle to get a mortgage. See the local council website for guidance on RTB.

If your in laws can't afford the rent now when it is social housing, how can they afford the rent when you are their landlord? There is a rule with Housing Benefit that expressly forbids a previous owner occupier from being able to claim HB for the first 5 years of their tenancy, to prevent the abuse of the HB system.

Where are you planning to live in the meantime? How do you feel about evicting your FIL if gets into rent arrears with you or damages the property? (This isn't as daft as it sounds, there was a thread on here from a son who had to evict his father from his flat who sabotaged the purchase of the freehold, intercepted his mail, ruined the flat including digging up the floor...).

Running_Horse

The nerve of some people.

danthedoors

Thanks all for suggestions. I really just wanted to see if this was at all feasible as know nothing about the legalities. Thanks for your help - at least i know where I stand now.

kingstreet

You have to be resident in the property for twelve months, then you can apply jointly with the tenant.

The tenant would have to apply jointly for the mortgage.

ihatemyhouse

people did this where I use to live, and now there is massive shortage of council houses, you use to get people buying there parents, uncles and aunties houses for cheap prices