Renting a property to daughter and sharer

xylophone

She is 28 years old, a hard worker,

Are you prepared to consider lending the money to your daughter to enable her to buy a property?

She can repay capital/interest at an agreed rate and you and your partner can take a first charge on the property.

You would have your solicitor draw up a formal agreement.

PersianCatLady

Are you prepared to consider lending the money to your daughter to enable her to buy a property?
Or they could just loan her enough for a decent deposit so that she would have more borrowing options.


However this may not get them the return on their investment that they were looking for.

PersianCatLady

Well because if they fail to pay the rent the parents would evict the stranger, but not the child. So the housing 'needs' are not the same (in my opinion anyway)
Yes I see what you are saying but if the child is receiving full LHA to pay the rent then they would be no reason for them not to pay the rent.

Pixie5740

Getting back to the OP....

How do the costs of renting half a flat, or a whole flat with a lodger, compare with the costs she faces living with her father? I imagine she would have more disposable income living with her father than she will when she moves out of home yet doesn't appear to have any savings. Can she realistically afford to rent from you or any landlord?

What rental yield do you expect to achieve with this 2-bedroom property?

paulpud

My partner is going to discuss with her daughter the pros and cons of renting with all the associated outgoings before a final decision has been made because we are all too aware of the difference when living with a parent. We think she'd struggle on her own, but should be ok if she has someone to share the rent and bills with.

The thought of actually lending her the money has crossed my mind, primarily to avoid the 3% stamp duty, but we feel at this moment renting would be the preferable route. Rental yield is not the priority at the moment so whilst the kind of properties we're in the market for tend to rent out at around £480 to £520 per month, we'd only be looking to recoup anywhere near that kind of figure once she'd got someone to share with.

As regards the cost of property, she lives in the West Midlands and there are a number of properties available for well under 100K. It's one of that factors that will make the search more difficult because we have to be sure we'd be happy for her to live in the places that we find. Whilst we're not going to get a place in the most desirable locations, we are looking in areas that we know fairly well and that we're confident will be decent enough, and we've already found 3 or 4 two bedroom terrace houses that we'd consider.

BrassicWoman

I would gift her 2k for rental deposit etc and put the rest into my pension. Then you have been v v good parents, and avoided future arguments.

hign10pines

PersianCatLady wrote: »

I see what you mean but then take a situation where parents buy a flat to rent out.


They can either rent it out to their child or a random stranger, why should one be able to claim LHA and not the other?


But it is so hard to find accommodation round here especially for people at the lower end of the income spectrum.

LHA in my area is well below actual private rent, I can hardly afford it but have no option as no help from family.

hign10pines

PersianCatLady wrote: »

Well because if they fail to pay the rent the parents would evict the stranger, but not the child. So the housing 'needs' are not the same (in my opinion anyway)
Yes I see what you are saying but if the child is receiving full LHA to pay the rent then they would be no reason for them not to pay the rent.

Claiming LHA and paying rent are too different things :rotfl:

AirJoe

Might have missed it being mentioned but spareroom dot com is the site you want for finding a lodger/someone to house share with.

I'd recommend taking a leaf out of some other forum members book's and price just below the going rate so that you have your pick of tenants and can be a bit fussy about who you get.

teddysmum

What if the lodger left and then the daughter lost her job ? Would she get enough LHA to cover the rent of a 2 bed property for just herself ?


Regarding 'nice' areas : There are properties in the Midlands and further north available from about £75000. They are ex-LA flats/houses or older terraced houses which need some updating.


The price does not mean that the areas are not 'nice' ie that the local residents are scum; just not well off.