Renting my house out to family

xylophone

Here's the crooks of it -

Do hope not!:) Try "crux".

See post 17 here

https://forums.moneysavingexpert.com/discussion/5399499

CashStrappedTeen89

Pixie5740 wrote: »

I'm guessing that if you can buy a 4 bedroom house for under £100k then the property market isn't particularly buoyant in that area. You may have spend £10k doing up the property but that doesn't translate to the property being worth £10k more.

Taking the most recent valuations then you will be looking at a gross rental yield of between 5% and 8%. If you could actually achieve £650 in rent for your property then it might be worth doing, especially if you are tied into your mortgage rate until 2018 (I shall add the caveat that I am not qualified to give financial advice in any way shape of form) and your lender will give you consent to let.

Where do you live just now? Is there any chance you would move back into the property yourself and maybe get a lodger?

Its relatively cheap to buy but my house required a lot of work to which it was so cheap.
True it doesn't I'm purely going on for sale prices around my area, I've visited 2 which where for sale one around a year ago and the last around 5 weeks ago, first was another 100 year old house 3 bed semi, no garage with small garden and that sold for 110,000 iirc other was one of the newer houses, 4 bed semi, integrated garage, very modern, that sold for £135,000.
I still live in the house in question, I'm just looking at my next step after its finished.
My area is NG19, Nottinghamshire.

Guest101 wrote: »

If you can give a bit of background, I'd tell you what I would do. BUT I don't believe that property is the best investment option

What sort of background info?.
May I ask why?.

marksoton wrote: »

You're missing my point. You'll need a BTL mortgage. Which means you'll need a very good LTV for a start.

Then there are very few lenders who will give you one of those and allow you to let to a relative.

Ah ok, fair enough, that may be one of those I will have to cross when it happens, there is no harm in looking for one but if its not cost effective for me to do it then I will rent to someone else.


Thanks for all the input guys and gals very useful information, I obviously take everything with a pinch of salt but always found MSE forums cover most of the answer for stuff like this.

CashStrappedTeen89

xylophone wrote: »

Do hope not!:) Try "crux".

See post 17 here

https://forums.moneysavingexpert.com/discussion/5399499

Many thanks, looking at the facts provided by everyone it is looking very unlikely it will be rented to family.
Still like the option of renting and I guess the next question how do I decide its the right option, or should it be sold.

Guest101

CashStrappedTeen89 wrote: »

What sort of background info?.
May I ask why?.


.

In your opinion what would you do in my position?.


Here's the crooks of it -

I'm 26 - So soon there could be kids (if there aren't already?)
Ok-ish wage 20+ - Not enough to pay both the mortgage and rent and anything else?
Mortgage is solely in my name - You've not mentioned a partner/spouse, so is that a consideration?
Mortgage is currently £400 PCM and is a repayment mortgage - When you get CTL, the rate may stay the same, but they will expect it to become BTL within a certain period, which will almost certainly be higher. fixed until the middle of 2018 iirc - It wont be if you're switching from residential to commercial
Rent around my area is anywhere from £400-650 depending on house, age and so on. - Will you be renting?
Mortgage is currently at £74,500
Last property value was £92,500 - £95,000 with it being considered as requiring full refurbishment as major works had been done and it was at bare walls stage (me and my ex split which is why it went on the market) - Does your ex have an interest in the property? did he/she pay any of the mortgage? even if via 'rent'
As I have done most of the works I estimate around a 10K investment so far. So possibly 100-105k valuation?

Guest101

Being presumptuous.


26, on 20k+, single and looking to move.


I would not keep a property on for rental, unless I had the perfect tenant. 2 year fixed term, family with large disposable income.


However, 26, engaged and fianc!e pregnant - I wouldn't be wanting to move out. as the financial pressure would cripple me should the tenant not pay rent even just once.

CashStrappedTeen89

Guest101 wrote: »

In your opinion what would you do in my position?.


Here's the crooks of it -

I'm 26 - So soon there could be kids (if there aren't already?)
Ok-ish wage 20+ - Not enough to pay both the mortgage and rent and anything else?
Mortgage is solely in my name - You've not mentioned a partner/spouse, so is that a consideration?
Mortgage is currently £400 PCM and is a repayment mortgage - When you get CTL, the rate may stay the same, but they will expect it to become BTL within a certain period, which will almost certainly be higher. fixed until the middle of 2018 iirc - It wont be if you're switching from residential to commercial
Rent around my area is anywhere from £400-650 depending on house, age and so on. - Will you be renting?
Mortgage is currently at £74,500
Last property value was £92,500 - £95,000 with it being considered as requiring full refurbishment as major works had been done and it was at bare walls stage (me and my ex split which is why it went on the market) - Does your ex have an interest in the property? did he/she pay any of the mortgage? even if via 'rent'
As I have done most of the works I estimate around a 10K investment so far. So possibly 100-105k valuation?

Guest101 wrote: »

Being presumptuous.


26, on 20k+, single and looking to move.


I would not keep a property on for rental, unless I had the perfect tenant. 2 year fixed term, family with large disposable income.


However, 26, engaged and fianc!e pregnant - I wouldn't be wanting to move out. as the financial pressure would cripple me should the tenant not pay rent even just once.

Thanks Guest101 really good stuff here.
I have a 2 year old son, he doesn't see his Mum just me, I have a girlfriend who has a 6 year old daughter, she rents.
We have no plans to get married, no immediate plans to move in together.

No nothing else at the moment, got a CC but nothing much on it.
Rest is about spot on.

Guest101

CashStrappedTeen89 wrote: »

Thanks Guest101 really good stuff here.
I have a 2 year old son, he doesn't see his Mum just me, I have a girlfriend who has a 6 year old daughter, she rents.
We have no plans to get married, no immediate plans to move in together.

No nothing else at the moment, got a CC but nothing much on it.
Rest is about spot on.

In which case I would consider the financial impact on my son (as well as the possibility of being a father again).


Currently you have a house which could house both of your families quite comfortably.


I would be using that as a stepping stone.


I wouldn't rent it out (due to the financial pressure) and I wouldn't sell it (as the money may just disappear on general expenses) until you had a house you wanted to move to.


On a side note, does the mum pay you support?

xylophone

You have a son, the possibility of remarriage to a mother of a daughter, and a family sized home on which you have done a lot of work.

Get on with the redecoration and stay there for a few years?

CashStrappedTeen89

Guest101 wrote: »

In which case I would consider the financial impact on my son (as well as the possibility of being a father again).

Currently you have a house which could house both of your families quite comfortably.

I would be using that as a stepping stone.

I wouldn't rent it out (due to the financial pressure) and I wouldn't sell it (as the money may just disappear on general expenses) until you had a house you wanted to move to.

On a side note, does the mum pay you support?

Understandable, unfortunately this would take us out of the catchment for both my partners daughter and my son for Nursery, my partner kindly has my son for majority of the work and the other day he goes to his nan and I collect him everyday after work.
Stepping stone may be an idea though as we have seen a house we do like but we don't plan to live together for at minimum another year the plan is 2-3 years atm.

No she does not, she has no involvement in my son's life and hasn't been for the last year, until I have a court order saying I am sole parent I would rather not do anything to invite her back in to our life.

xylophone wrote: »

You have a son, the possibility of remarriage to a mother of a daughter, and a family sized home on which you have done a lot of work.

Get on with the redecoration and stay there for a few years?

No marriage, that is definitely off the cards.
As above.

Guest101

CashStrappedTeen89 wrote: »

Understandable, unfortunately this would take us out of the catchment for both my partners daughter and my son for Nursery, my partner kindly has my son for majority of the work and the other day he goes to his nan and I collect him everyday after work.
Stepping stone may be an idea though as we have seen a house we do like but we don't plan to live together for at minimum another year the plan is 2-3 years atm.

No she does not, she has no involvement in my son's life and hasn't been for the last year, until I have a court order saying I am sole parent I would rather not do anything to invite her back in to our life.



No marriage, that is definitely off the cards.
As above.

I'm not sure if you've taken legal advice.


But in the UK the mother automatically has PR always. (presumably you do too).


There's no such order as to be the 'sole' parent. You would be classed as the main carer provider, or the Parent with Care of the child. And she the Non resident parent.


That wont change unless there is some very very extreme reason. (like prison kind of reason)