Moving from joint owned house to live with girlfriend

Higgy28

Hi,

A couple of years ago I purchased a flat with a friend as we had no way to purchase on our own in the south of England (50/50% tenants in common) and everything has been fine so far.

I've recently got to a point in my relationship that I want to move in with my girlfriend (she has her own property that she has a mortgage on).
We don't want to sell our joint flat for another couple of years as it is in an upcoming area, so I was looking into renting my room out.

My friend is happy with this in principle (we agree that anyone renting the room must be chosen by both of us), but has suggested that any money taken in from renting a room in the house should be split 50/50 between us. (for reference there is also a third smaller bedroom that we don't currently rent out)

We pay £700 each into a joint account to cover mortgage and bills, but the going rate for a double room inc bills would be £500. I am happy to cover the extra £200 as the property is still an investment for me.
However if we split the £500 between us, as he is suggesting, I would have to be putting in £450 a month to cover the bills, while also contributing to some of my girlfriend's bills (probably ~£300-400).
This would mean I would end up out of pocket and my friend (and girlfriend) would both be benefitting from my room rent.
We are in agreement that we want it to be as fair as possible, but I don't see a way for that to work unless I receive the whole £500, or at least £400-450.

Is splitting the rent really the correct approach?

diggingdude

Remember your friend is now having to share his house with a stranger because you want to move out. Would you want to be compensated if you were in their position? Of course you could offer them to buy you out of the flat?

hazyjo

I would personally just sell and start again. Perhaps you could persuade your GF to buy with you if it's that serious in the same up and coming area. If it's not that serious, or she doesn't want to move, I'd consider waiting another year or so.


Prices are likely to continue to level out or be a bit static for a while anyway with all the Brexit palaver coming up. Saying that, prices are still rising where I recently sold and where I bought. Might be a little bit of a wobble over the next couple of years though.


Must say, your friend is being very reasonable in all this. If my co-owner upped and went, I'd not want a lodger!


Don't see why you'd still be paying half of bills if you're not living there. Half the mortgage, fair enough.


£400 seems like a lot to be giving your GF. Ignoring whatever mortgage she has (not advisable for you to contribute towards that anyway), her bills are unlikely to come to £800pm.

bitsandpieces

I don't think there's a single correct approach - it's down to what you can agree. I think most people would want some share of the rent to make up for having to share with a stranger (some would be delighted with £50/month for this...I'd be wanting at least a couple of hundred myself).

What are the other options - can either of you buy the other out? If not, you could consider selling the flat, or moving your girlfriend in while renting/selling her place.

It's in both your interests to agree on something - going to court will be expensive/time-consuming for you both.

shortcrust

hazyjo wrote: »

I would personally just sell and start again. Perhaps you could persuade your GF to buy with you if it's that serious in the same up and coming area. If it's not that serious, or she doesn't want to move, I'd consider waiting another year or so.


Prices are likely to continue to level out or be a bit static for a while anyway with all the Brexit palaver coming up. Saying that, prices are still rising where I recently sold and where I bought. Might be a little bit of a wobble over the next couple of years though.


Must say, your friend is being very reasonable in all this. If my co-owner upped and went, I'd not want a lodger!


Don't see why you'd still be paying half of bills if you're not living there. Half the mortgage, fair enough.


£400 seems like a lot to be giving your GF. Ignoring whatever mortgage she has (not advisable for you to contribute towards that anyway), her bills are unlikely to come to £800pm.

Same here! It would be a very firm and flat no from me even with 100% of the rent.

lildoonbuggy

My husband had a similar situation when we moved in together, but his friend wanted half the rent. I think regardless someone is losing out and actually, if you are struggling to come to an agreement now it is likely not to get easier once you have someone in there and building a relationship/making things complicated with your friend. We needed to get lawyers involved in the end to agree a transfer of ownership plus a settlement of the difference in appreciation. All I can say is this situation is only fine when it's working, and terrifying plus costly when not and it can happen in the blink of an eye. My husband lost a lifelong friend due to this highly emotive arrangement and all I would recommend is sell and put it toward your own place or at least a place where everyone is in agreeance. Good luck!

kinger101

The easiest solution is making whoever moves in responsible for 50% of bills (council tax & utilities).

Higgy28

Thanks for the comments, it has maybe helped me see things from my friend's perspective a bit more.
To clarify a couple of things - we always intended for this to be reasonable short term ownership (~3 years) and due to our careers/relationships there was always the understanding that if one of us wanted to move out they would rent out the room, or if we both moved out we would convert it to a BTL.
We are aiming to get a mutual friend (that we have both lived with previously) to move in, so it wouldn't be a stranger that is moving in.

franklee

Provided your friend knows the person moving in and is happy with them then I do not think your friend's situation should change. Therefore I'd expect you to pay towards the joint bills exactly as you do now, pocket all the rent from your room and be responsible for any damage the new lodger does. In other words the new lodger is your responsibility and has just stepped into your shoes. That's assuming the lodger's rent is inc. bills as the OP says.

However if your friend says no then you are stuffed. Presumably you then refer to the written declaration of trust you drew up when buying that covers what happens when someone wants to move.

To be awkward you could move girlfriend in and let her place but that would not be fair on your friend (unless he has a partner living there too).

getmore4less

We pay £700 each into a joint account to cover mortgage and bills, but the going rate for a double room inc bills would be £500. I am happy to cover the extra £200 as the property is still an investment for me.

There are 2 parts , the cost of buying and the cost of living in the place.

As an investment you do not get the bills(living costs) element of any AI rent.

As the two owners you need to separate the the costs into costs for buying and costs that belong to living in the place

In effect become virtual landlords of a property where you pick up the costs of owning between you, mortgage insurance maintenance etc. as if you were landlords

As owners on paper you rent to the occupier.

They can get a lodger to supplement their costs and rent.


Why are you discussing this now it should have been in the agreement when you bought he place, what happens when one wants to move out.

franklee

getmore4less wrote: »

There are 2 parts , the cost of buying and the cost of living in the place.

As an investment you do not get the bills(living costs) element of any AI rent.

As the two owners you need to separate the the costs into costs for buying and costs that belong to living in the place

In effect become virtual landlords of a property where you pick up the costs of owning between you, mortgage insurance maintenance etc. as if you were landlords

As owners on paper you rent to the occupier.

They can get a lodger to supplement their costs and rent.


Why are you discussing this now it should have been in the agreement when you bought he place, what happens when one wants to move out.

Don't agree with this method as it puts all the risk for non payment of bills by the lodger onto the friend still living there. I think that given it's the OP who chooses to move out replacing himself with the lodger then he should bear the risk of non-payment. He should do all the work administering the lodger as well as I do not see why the friend should be inconvenienced. Unless of course the friend would prefer to take it on to gain control of events or their written agreement says otherwise.