Buying or renting house after grandparent has passed away

dansarath

Hi,

Just looking for some advice...

My girlfriend and I are looking to move in together. A few months ago, her grandmother passed away. Her parents have asked us if we would be interested in living in her old house, either as tenants or buying the house from them. The house had been fully paid for before her nan passed away.

It's not a bad little house. It's small; estimated around 80-100k. However, we would probably need to make quite a few refurbishments. Nothing major but almost all the decor, appliances, etc. are all very old-fashioned. It's also not exactly where we initially wanted to live; it's on the outskirts of a small town as opposed to near a city which is where our friends are, as well as my job. As such, we would probably only consider living there for a year or two at most before hoping to move elsewhere. We'd either rent it for 12-24 months before looking to buy somewhere as our first home, or buy this as our first home and sell it after 12-24 months to move to another.

I'm wondering if anyone has gone through a similar experience or could help with a few of the questions we have whilst we're mulling this over e.g. what would the cost of the renovations be for something like this? Would renting somewhere else temporarily, like a fully furnished apartment in an area we'd like live, be more cost-effective instead of this? What kind of complications might we encounter if we bought from her parents? Are there benefits to getting on the property ladder and selling the house after a year or two?

Just some general advice would be greatly appreciated since neither of us really understand this very much.

Thanks!

HampshireH

Do you want to be landlords? And could you get a mortgage to do so or would you be cash buyers? Do you have spare cash to spend minimum 10-20k on the house before you rent it out to someone?

Think electrics, appliances kitchen/bathroom/redecorating as a starting point.

Thats your starting point. It is a lovely opportunity you are being offered. But tmif it isn't right for you thats all it is, an opportunity not an obligation.

Are her parents likely to sell it if you say no? Would a cash gift upon sale towards your new home be an alternative?

ashe

HampshireH wrote: »

Do you want to be landlords? And could you get a mortgage to do so or would you be cash buyers? Do you have spare cash to spend minimum 10-20k on the house before you rent it out to someone?

Think electrics, appliances kitchen/bathroom/redecorating as a starting point.

Thats your starting point. It is a lovely opportunity you are being offered. But tmif it isn't right for you thats all it is, an opportunity not an obligation.

Are her parents likely to sell it if you say no? Would a cash gift upon sale towards your new home be an alternative?

I think they are asking about them renting it rather than renting it out to someone else?

In answer to OP you are unlikely to get your money back unless its in a very desirable area, your costs for moving and buying as well as refurbishment will be far greater than any value added over 12-24 months, and the market could drop in that time due to any number of factors. If you don't want to live there for a longer period of time and its not where you really want to live, its a nice offer but you are best off declining and moving elsewhere. You;'ll lose any first time buyer status for deals / stamp duty as well.

lisyloo

Generally it's not worth buying for a short period as there are transactional costs that will eat in.
Also you quite often won't make a lot of money on refurbishment as people often want their own taste. The exception would be if you both have DIY skills and are planning to do a lot of the work yourselves - but do still bear in mind you are then giving your time for free and unless you actually enjoy that or it will benefit you skill wise then you need to value in your time.


Personally I'd go for something you want - unless you have DIY skills and don't mind contrbuting your free time.

dansarath

Because it's quite a remote rural area, I'm worried about relying on being able to rent it out once we've moved out. I'm concerned we wouldn't find tenants. Am I right in being anxious about that or way off base?

A mortgage might be a problem for us at the moment because she's a supply teacher at the moment, although she is looking for a permanent job during this term. We have savings but probably not enough. Originally, we were just going to rent until we were both in stable jobs then look into getting a mortgage to buy our first house. But now this opportunity has come along.

It's likely someone else in her family will buy it if we don't. Otherwise, it'll probably just be sold to someone else through an estate agent.

Thanks for your help - it's really appreciated!

pmlindyloo

dansarath wrote: »

Hi,

Just looking for some advice...

My girlfriend and I are looking to move in together. A few months ago, her grandmother passed away. Her parents have asked us if we would be interested in living in her old house, either as tenants or buying the house from them. The house had been fully paid for before her nan passed away.

It's not a bad little house. It's small; estimated around 80-100k. However, we would probably need to make quite a few refurbishments. Nothing major but almost all the decor, appliances, etc. are all very old-fashioned. It's also not exactly where we initially wanted to live; it's on the outskirts of a small town as opposed to near a city which is where our friends are, as well as my job. As such, we would probably only consider living there for a year or two at most before hoping to move elsewhere. We'd either rent it for 12-24 months before looking to buy somewhere as our first home, or buy this as our first home and sell it after 12-24 months to move to another.

I'm wondering if anyone has gone through a similar experience or could help with a few of the questions we have whilst we're mulling this over e.g. what would the cost of the renovations be for something like this? Would renting somewhere else temporarily, like a fully furnished apartment in an area we'd like live, be more cost-effective instead of this? What kind of complications might we encounter if we bought from her parents? Are there benefits to getting on the property ladder and selling the house after a year or two?

Just some general advice would be greatly appreciated since neither of us really understand this very much.

Thanks!

Questions coming up...……...sorry!

How long have you known your girl friend? Since this is your first house together then it may be best that you rent rather than buy - just in case you hate living together!

If this wasn't your girl friend's nan's house would you consider it either to rent or buy considering - commute to work - time to modernise - distance from friends. Unless the parents are offering a hefty discount for either renting or buying then I suggest you move to an area you want.

Can you afford to buy it? Rent it? Are your jobs secure? Would you ever need to claim benefits - renting from relatives can be tricky to say the least as regards claiming housing costs.

My initial reaction is thanks but no thanks unless this is a super cheap deal.

And I am a great believer in never mixing family with business

dansarath

ashe wrote: »

I think they are asking about them renting it rather than renting it out to someone else?

In answer to OP you are unlikely to get your money back unless its in a very desirable area, your costs for moving and buying as well as refurbishment will be far greater than any value added over 12-24 months, and the market could drop in that time due to any number of factors. If you don't want to live there for a longer period of time and its not where you really want to live, its a nice offer but you are best off declining and moving elsewhere. You;'ll lose any first time buyer status for deals / stamp duty as well.

Thanks for this. I had no idea about first-time buyer status so that's really useful to know.

dansarath

pmlindyloo wrote: »

Questions coming up...……...sorry!

How long have you known your girl friend? Since this is your first house together then it may be best that you rent rather than buy - just in case you hate living together!

If this wasn't your girl friend's nan's house would you consider it either to rent or buy considering - commute to work - time to modernise - distance from friends. Unless the parents are offering a hefty discount for either renting or buying then I suggest you move to an area you want.

Can you afford to buy it? Rent it? Are your jobs secure? Would you ever need to claim benefits - renting from relatives can be tricky to say the least as regards claiming housing costs.

My initial reaction is thanks but no thanks unless this is a super cheap deal.

And I am a great believer in never mixing family with business

Mixing family and business is a concern, for sure! We've been together for a long time so don't think that'll be an issue (I hope!) but you've addressed a point I initially had in mind which was that if we'd normally never consider this location or property had it not been for the circumstances. Thanks for all the advice!

getmore4less

First rule

would you have even considered living there if it was not a previous family home.

Unless there is a very good incentive to live there rather than where you want to live "Thanks but no thanks"

missile

I would not buy and unless rent is much less than market value then I too would say

getmore4less wrote: »

"Thanks but no thanks"

[Deleted User]

We did similar when my grandad passed away but my mum offered for us to live in his house rent free to allow us to save up for a house deposit. So we did that for three years paying just the household bills. It wasn't where we wanted to live and the house was a little outdated decor wise but was a huge help for us whilst saving.

I suppose it depends what deal they are offering you. If they are offering to let you rent it cheaply it might be worth it but agree that theres no point buying it if your only going to sell it in a couple of years.