Inheritance of a property - rent it out as income?

AdrianC

Dunney77 wrote: »

Channel Islands, which has a similar property market to London.

Can of worms. Not only do you have to deal with tenancy laws, but you will be earning income in a foreign tax jurisdiction, one that's outside the EU. Be very, VERY sure that you want to do this.

...my family member worked hard all his life to reach that property. Doesn't feel right to sell it.

With all due respect, your family member has died. The property is now yours. You need to decide what to do with a valuable asset, one that - if you treat it wisely - will make your whole life very much easier. But... it also has the potential to make your life very much harder until you bite the bullet.

Being an accidental landlord of a place with sentimental value is just adding complication to an already complicated area of life. Doing it across borders and tax jurisdictions? <shudder>

Are there property ownership/residence/wealth laws on that particular corner of the CI that might cause you even greater problems?

Add in the small detail of 2k/mo for a £700k property? Well, frankly, 3.4% is a long way from being a great yield, even before you start to muck about with agent fees.

dancingfairy

Presumably the family member left it to you to do with it as you thought best?
Sentiments aside surely it would make more sense to sell it and bank the money and use it as a deposit on somewhere/to fund masters/accounting qualifications etc than to try and rent it out, given that you live in a different country etc?
df

-taff

My family rented out my grans old house for a while. She absolutely trashed it. They never rented it again and it has sat empty for years.
Unless you plan on moving there at some point, sell it.

slopemaster

It is true that the probable nett return on £700 000 is rather low. But (with any luck), the rental return is only part of it - you will also have capital appreciation which should at least keep pace with inflation in the long term, So, you have cash coming in that you can spend without your capital being eroded.

But yes, with it being in the Channel Isles, you do need to research both landlord law and tax rules - both income tax and, perhaps more importantly, capital gains tax.

I differ with those who advise against letting it.

I was lucky enough to be left in a similar situation, with a fairly valuable property which brings in a welcome income although it is, in theory, a poor rate of return. You will need to find a good letting agent, and negotiate hard on their fees for full management. I did this to enable me to take a step back from a property I was emotionally involved with. Finally, after 3 years, I felt ready to take over the management myself, thus increasing my nett income.

I am now considering that in another couple of years I may be ready to finally cut the emotional links to the place by selling it and investing the money in rental property with a better rate of return. But letting it has enabled me to take my time about this. I know exactly what you mean about not wanting to just sell something that your relative worked so hard for

Geo2015

Slope Master has a good point... I also agree that renting a house is a good temporary option, if one is not quite ready to sell and let it all go, especially if one has strong emotional ties to a house and is not really ready to see it go. Renting brings in cash every month and buys as much time as needed to decide a permanent course of action, as the writer says. Another option you might want to consider, that is easily available in the US and Canada, are inheritance loans, if the house you have inherited is still in probate, or is in trust; and is for sale -- or if you are also inheriting liquid assets that you can base an inheritance loan or probate advance on, or an inheritance loan against instead of the real estate. You'd need to look around, probably online, for financial firms in the UK that specialize in inheritance cash advances or probate loans.... boutique financial firms like Heir Advance Co, or InheritanceNow.com, or InheritanceAdvance.com. Basically, you're borrowing against your own upcoming or current inheritance, with a probate loan or trust fund loan, depending on what your inheritance situation is. If you can base your inheritance advance on the liquid portion of your inheritance, you don't even have to base the inheritance loan on the house at all. If the house is all you have to work with, if that's all you are inheriting, or are inheriting shares of, then the house usually does have to be listed for sale -- but at least you have the inheritance advance funds to work with right away, as you may have investment opportunities that can't wait. So it isn't the perfect solution for everyone... but it is a reasonable option you can turn to if need be, as long as inheritance loans are offered to you, and you can be approved quickly. The inheritance advance firms I mentioned generally take only 2--3 days to fund after your paperwork requirements are complete. That's fast. A house sale takes time, and if you're waiting for probate to end, to close -- that could involve a long waiting period, and you might not have that much time if your investment opportunities are pressing. Anyway -- something to think about.

[Deleted User]

Reported as spam as the OP clearly stated they'd like the monthly income and no suggestion was made as to needing a sum of money immediately.

Lets forget the interest shall we?

Hoping the post is removed asap.