Renting to a Family Member

duckandcover1

Hello,

I am looking into the possibility of renting my property to my brother but I have some concerns

The first one being if he is out of work, what are the complications around receiving housing benefit when he rents from a family member, can he still get it?

He is working at the moment but is not in the most stable of jobs and whilst we can afford to rent to him without him paying us, it would be nice to know what we can expect to receive should he be out of work?

Finally, what about benefits such as council tax benefit if he isn't working or child tax credits or whatever else he may be entitled to.

Thanks

Gary

jbainbridge

Not sure about benefits.

Never rent to someone you wouldn't be prepared to evict!

Annisele

In theory he can still get housing benefit if he's renting from a family member - but only if the tenancy isn't "contrived". Whether a tenancy counts as a contrived tenancy is complex, but one of the tests is whether it's on a wholly commercial footing. If you wouldn't be prepared to evict your brother if he didn't pay his rent, then that's probably a contrived tenancy - so he wouldn't get housing benefit.

Is the property mortgaged? If so, worth checking if you're allowed to let to a close family member; standard BTL mortgages don't usually let you.

tea-bag

A few hurdles to jump.

1, have you rented out the property before?
2, is it a recent purchase?
3, is he paying the going rate against similar properties in the area?
4, do you have a proper legal tenancy?


These are things and more they will look at. This has been exploited for years buy some sections of the community this is why they are able to take over areas.