Renting to brother.

Gam2015

To cut a long story short i've been renting a property to my brother since december 2013, i've always charged him 400 pcm the property is a 2 bedroom house in south yorkshire, current mortgage owed is 33k (paid 65k) monthly payment is £83. I've been looking on the net and similar houses in the area rent around 450/475 so was thinging of putting it up a little would yo do the same or just keep it at £400 to keep him happy as he is a good tennant in fareness. Cheers

Tigsteroonie

Does he treat you like a landlord, for example if something goes wrong in the house (drain blockage, leaking tap) does he get you to come round and fix it? Or does he sort it himself to save you bothering?

If he treats you like a landlord, increase the rent

G_M

Would I do the same?

My relationship with my brother may not be the same as yours.
My brother's personal circumstances may not be the same as yours.

so it's a pointless question. Whether you should increase the rent is entirely a personal matter.

BTW - are you aware of all you LL obligations (tax, consents, safety, documentation etc)?

* New landlords: advice, information & links

Marvel1

When we had new bills for the year water, internet, council tax they went up by £2-£5 a month. That was a lot for me when it's all added. Increasing a jump by £50 minimum well you get what I mean.

AnnieO1234

Only you really know the relationship you have with your brother. If it was me, I would be open with him and tell him that you could get more money from renting to someone else but that you don't want to be seen to be money grubbing. Recognise that if you did get a different tenant you'd be risking voids, risking them not taking care of the property as much because the landlord isn't family etc.

From brother's point of view, he would be risking an inattentive landlord, one who won't come out at midnight to sort a problem, or one where he can't get away with sorting things himself. One who will demand a deposit and possibly further security. One who might turf him out 6 months down the line.

I would be open with him about both aspects. I wouldn't personally risk asking for an extra £50 on such a low mortgage payment. The risks would outweigh the rewards.

If you're struggling to maintain the mortgage, then I would seriously question whether you have the capacity to be a landlord at this time. You're obviously making money from the rental given your payment, even taking everything into account. I wouldn't be too gung ho in increasing it.

You could perhaps suggest to brother that he might want to increase the payment to you if your costs increase but at the moment I really wouldn't upset the apple cart. xxx

Clutterfree

Is it "officially" rented to him? i.e. Have you but all the necessary safety certificates, etc?
Or is it more of an informal family agreement?

Personally I'd not ask him for an increase because you have peace of mind knowing you have a decent tenant. That's worth more than £50 in my mind.

tlc678910

I wouldn't increase the rent simply because it is out is sync with the going rate. If the other costs of maintaining and letting the house plus the mortgage were costing you more than the rent then I would explain this and possibly increase it to help to cover your costs.

I guess I'm assuming that you are not financially stretched - if you are you might have to charge the going rate. However this could backfire if your brother leaves and you have voids or bad tenants.

If your brother asked for any upgrades that you were happy to provide (refit of bathroom or kitchen for example) that could be a good time to discuss a rent increase.

Tlc

Cakeguts

How do you know what the rents are from the internet. People make offers on rental prices you know so what is advertised may not be the actual rent that is finally paid.

Gam2015

Yes its all official BTL mortgage and boiler serviced every 12 month etc. Thanks for all your replies think i will just leave it ticking over as it is for the time being as he is a good clean tennant. Cheers

luvchocolate

you are very lucky your lender has no problem with you renting to a member of your family.......