Tips on letting property out to family!

spingirl

Both fair points. I'm no push over myself & am not going into this lightly, a tenancy agreement would have to be agreed beforehand so either side knows the arrangement. There will be rules such as no pets, no smoking & no decorating without prior agreement.

Don't really see how anyone could see it as unreasonable to ask a tenant that is not paying their way to leave, why should someone else foot the bill of someone else's living costs.

I think with regards to any business in any industry, rates go up, fees/charges go up, isn't that the way the world works? Correct me if I'm wrong? Of course everything has to be fair & relative, can't just demand more money because you feel you can/should, notice would also have to be given. What we pay for our mortgage & what we will charge in rent adequately covers the cost & there is more left over to cover insurance & to cover maintenance & repairs etc.

Pixie5740

If a tenant stops paying rent for whatever reason it isn't a simple case of just asking them to leave. You have to serve notice and can go all the way through court and to bailiffs physically removing the tenants from the property which can be an expensive process.

Ivana_Tinkle

Is there anything any of us could say to convince you this is a really, really bad idea?

BobQ

spingirl wrote: »

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

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

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

Hope it works out.

Re your knowledge of bad experiences of renting to strangers, I agree that nothing is guaranteed when you do so. But many of the things you refer to can be covered by insurance to repay unpaid rent and the legal costs of eviction.

I am inclined to agree that friends and relatives are less likely to let you down deliberately (assuming your judgement of character is reasonably good). But they are also more likely to ask for things a stranger would never ask (such as leeway on paying the rent).

One other comment, if you own the property it will not matter, but if you have a mortgage are you clear that the mortgage provider accepts letting to relatives?

bitsandpieces

spingirl wrote: »

Don't really see how anyone could see it as unreasonable to ask a tenant that is not paying their way to leave, why should someone else foot the bill of someone else's living costs.

If they don't go when you ask, it could ultimately come down to going to court for the appropriate orders then hiring bailiffs to throw the family out into the street. You may or may not see this type of action is reasonable if tenants aren't paying rent, but certainly not a nice thing to be doing if it comes to that - especially not to family.

I think with regards to any business in any industry, rates go up, fees/charges go up, isn't that the way the world works? Correct me if I'm wrong? Of course everything has to be fair & relative, can't just demand more money because you feel you can/should, notice would also have to be given. What we pay for our mortgage & what we will charge in rent adequately covers the cost & there is more left over to cover insurance & to cover maintenance & repairs etc.

Interest rates have fallen significantly in the recent past - rents certainly haven't fallen in line with this (sadly!) Likewise, if interest rates rise five-fold, rents almost certainly won't rise in proportion with this. Private rents are determined by a market that's not unrelated to interest rates but not nearly as closely related as your mortgage payments will be! If you're letting your property you should see this as a business - be prepared to deal with changes such as interest rate rises (or, say, the central heating dying) which may force you to absorb extra costs.

phill99

2 rules:

Never employ someone you aren't willing to sack and never let a house to someone who you aren't willing to evict.

tibawo

I rent from a family member, well technically the business. I have done for over seven years.

There are pros and cons. Sometimes when I've told him about something I can find he has nipped in and fixed it without telling me. Which i suppose i could fuss over but this works fine for me. I pay my rent on time purely because I budget and because i think my parents would be heartbroken if we fell out. I still argue with him over politics etc but I think a lot of it is down to the relationship you have.

Yes I would like to own my home but I have been thru a lot in the last seven years and now I' m getting back on my feet am thankful for the values our parents instilled in us.

anotheruser

Am I the only one who didn't make the connection of "family" being "family member"?
I just assumed you meant a family, not related to you

Yorkie1

spingirl wrote: »

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

No, you can't just do that. The rent is fixed by the contract and you need to ensure that you have a sufficient buffer to enable your business of property letting to survive.

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

Yes, but if you have to evict people you don't know then it's far easier emotionally and you have no family pressure to compromise your situation.

- 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.

Again this demonstrates that you're not really clear about how the business of being a LL works. You have to comply with legislation in order to evict someone. It can take months, and them being family will probably make it far harder emotionally to chuck them out on the street.

Does no one have any positive experience here??

not yet!

spingirl wrote: »

Both fair points. I'm no push over myself & am not going into this lightly, a tenancy agreement would have to be agreed beforehand so either side knows the arrangement. There will be rules such as no pets, no smoking & no decorating without prior agreement.

Unenforceable.

Don't really see how anyone could see it as unreasonable to ask a tenant that is not paying their way to leave, why should someone else foot the bill of someone else's living costs.

See previous comments.

I think with regards to any business in any industry, rates go up, fees/charges go up, isn't that the way the world works? Correct me if I'm wrong? Of course everything has to be fair & relative, can't just demand more money because you feel you can/should, notice would also have to be given. What we pay for our mortgage & what we will charge in rent adequately covers the cost & there is more left over to cover insurance & to cover maintenance & repairs etc.

Do you have a mortgage yet? What is the going rate for rent in the area for that type of property? Is it 125% of the mortgage repayments at 6% AER? Does the lender know you're letting out to family? - this causes a problem with many lenders.

I agree with others that letting to family is frequently a poor idea. It seems to me that before you posted, you wanted validation of your proposal, and intend to go ahead irrespective of all the warnings people have posted.

I am also concerned that your replies show that you don't actually understand what being a LL is about, which itself makes you vulnerable to doing things wrong or being pushed around. Just because you know the tenants doesn't mean you can either just enter the house when you want, or that you can skimp on anything such as deposit protection / gas safety certificate etc.

Strapped

If you are willing to never speak to them again if it all goes wrong, go for it. Otherwise, no.