Tips on letting property out to family!

Thrugelmir

spingirl wrote: »

We will be using a separate bank account & money left after transactions will be used to maintain the property & pay for insurance so personally think it unethical to promise new carpets, not replace them, up the rent & then jet off on holiday!

You are running a business. If interest rates rise are you prepared to raise the rent? You are only hearing one side of the story.

I'm all for being ethical , good business practice etc. However commerciality has to come first. Replacing windows, boilers, carpets etc doesn't come cheap.

Being relatives you are letting to I can see you being pushed around.

BobQ

OP,

You seem to have convinced yourself that its a good idea in this case. I hope it works out for you but you can never be sure.

I was once asked by a relative if I would let a house to them and almost considered it. Two years later they were evicted from their rental property with four months rent owing. You may think you know your SIL but do you know all her business. She may of course put you down as a soft touch who would never evict them if push came to shove.

Paulaviki

I agree with the others, you have to look at renting your house as a business and I personally would avoid renting to friends or family. Unfortunately you just don't know what could happen and cause issues, e.g. if they want something done to the house you don't agree to or can't pay rent one month. It's not just them it would be hard to deal with, but what if other family members get involved? Worst case scenario is that it could seriously ruin relationships.

Might not be likely but is it a risk you are willing to take?

Jenniefour

I don't think what their LL did was OK - he didn't get on with what he promised. That doesn't mean that you should put yourself in a position that might jeopardise your good relationship with them. It's called "dual roles" and to be avoided if at all possible, simply because lots of dual role situations, including this, have an inbuilt conflict of interest right from the start. Which may not ever surface because nothing happens to cause an open conflict. But it might. And that can ruin previously good relationships.

robatwork

Just ask yourself what you would do if they found themselves in the position that they had to stop paying rent.

If you would let them live there, indefinitely, until they started paying again and it wouldn't bother you, then go ahead. If it would make you feel in the slightest awkward, avoid.

poppysarah

robatwork wrote: »

Just ask yourself what you would do if they found themselves in the position that they had to stop paying rent.

If you would let them live there, indefinitely, until they started paying again and it wouldn't bother you, then go ahead. If it would make you feel in the slightest awkward, avoid.

This.

Need more characters.

spingirl

Thanks for all your replies, I value them all & can totally see where you are all coming from.

Several things are
- naturally if interest rates rise, rent will rise of course, that's beyond our control

- I may be a bit soft but my husband certainly isn't!

- the reason I think it's a good idea is that using good judgement of character & better the devil you know. Another relative used an agency & were letting to "a lovely family" all was good until the husband lost his job & they refused to pay rent, answer calls, emails, letters & left our relative having no choice but to go through the courts which took the best part of the year to sort out & at their own expense.

- I understand risk is there but it is also risky renting to people you don't know isn't there?!

- if any tenants had to stop paying rent they would be under contract & would have to find other means - that's not really our problem, whilst I'm fair & would give some time I'm not a mug & am not interested in free loaders. Luckily could afford to pay for the property but would not be wiling.

Does no one have any positive experience here??

Guess will prob take our chances & have to go on our own judgement, there is always risk..

poppysarah

spingirl wrote: »

- I may be a bit soft but my husband certainly isn't!

-..

Discuss this with him.
Ask him what he'd do. And then think about how you'd feel about your husband evicting them.

Kynthia

spingirl wrote: »

- the reason I think it's a good idea is that using good judgement of character & better the devil you know. Another relative used an agency & were letting to "a lovely family" all was good until the husband lost his job & they refused to pay rent, answer calls, emails, letters & left our relative having no choice but to go through the courts which took the best part of the year to sort out & at their own expense.

Yes this can happen, but it could also happen with your family as tenants. It will be horrible either way but only with family would it ruin relationships and spill over into disputes and bad feeling with the wider family too.

princeofpounds

- naturally if interest rates rise, rent will rise of course, that's beyond our control

Thankfully, if interest rates rise rents do not rise in sympathy. Economics just doesn't work that way. If businesses have not covered the risks of using floating-rate finance properly, they don't get to simply charge the customers more to bail themselves out.

Anyway I think the warnings on the thread are pretty plain, but I wouldn't be in the camp that suggests a blanket ban on renting to relatives. But you do need to be exceptionally careful.