Buying house from parents

smcg2011

Hi all, my partners parents were going to give us a plot of land in a back field of a property they own. There is a house on the land which they planned to retire and live on . Sadly in a change of circumstances failing health and not fit to work, would it be possible to purchase the house and land from her parents for what they paid for it back about 15years ago. In order to help them with money situation

It was my partners grandparents house that was left to her uncle who sold it to her mother for around 60k . They are willing to let us buy it for that now?they would make no profit on it? Is this legal? Is there any tax implications for it? Or anything else you can think off
It is not their home btw

Thanks

hazyjo

"To help them with their money situation?"

How?

I would have thought that selling it at today's price would do that far more successfully :think:

Don't get the "it is not their home" bit at the bottom... please explain.

Pixie5740

smcg2011 wrote: »

Hi all, my partners parents were going to give us a plot of land in a back field of a property they own. There is a house on the land which they planned to retire and live on . Sadly in a change of circumstances failing health and not fit to work, would it be possible to purchase the house and land from her parents for what they paid for it back about 15years ago. In order to help them with money situation

It was my partners grandparents house that was left to her uncle who sold it to her mother for around 60k . They are willing to let us buy it for that now?they would make no profit on it? Is this legal? Is there any tax implications for it? Or anything else you can think off
It is not their home btw

Thanks

Whose home is it then?

How does it help their financial situation selling the property and land at 2004 prices? Surely they would want to sell it at 2019 prices.

Failing health + giving away equity = deprivation of assets.

POPPYOSCAR

As it is a second property HMRC will base any CGT tax liability on the true value and not what you pay for it.

smcg2011

Sorry to clarify. It was my partners grandparents house which my partners parents bought. There is a field and a house. They were going to give us the field so we could build on it but sadly my partners father got injured in an accident and can’t work anymore therefore they need money to live on. The plan is now to buy the house and field for what they first bought it for. This would help there finances obviously . They don’t want to make a profit on it just want to sell it to ya for what it cost them. They have their own home a mile up the road where they live.

hazyjo

Nope. Still don't get it. He can't work, and they need the money. So they are not selling on the general market? Surely they would have even more money to live on. Why wouldn't they want to make a profit? Surely the only people benefitting from this arrangement would be you/your partner?


Was there ever planning permission to build on the field? Is there direct street access to the field? Do you have anything saved towards building a house? Presumably you're now saying you want to live in the house, or that you want to build one still and flog the main house?

foxy-stoat

hazyjo wrote: »

"To help them with their money situation?"

How?

I would have thought that selling it at today's price would do that far more successfully :think:

Don't get the "it is not their home" bit at the bottom... please explain.

Originally the field and house was going to be gifted to the OP, now they want to buy it @ 2004 prices to "help them out".

As already stated, buying it at the market rate would be a better idea as they may fall foul of deprivation of assets.

G_M

smcg2011 wrote: »

[STRIKE]Hi all, my partners parents were going to give us a plot of land in a back field of a property they own. There is a house on the land which they planned to retire and live on . Sadly in a change of circumstances failing health and not fit to work,[/STRIKE] would it be possible to purchase the house and land from her parents for what they paid for it back about 15years ago.
Yes
In order to help them with money situationNo. This is helping you, not them.

[STRIKE]It was my partners grandparents house that was left to her uncle who [/STRIKE]sold it to her mother for around 60k . They are willing to let us buy it for that now? I don't understand the question. Are they or aren't they?How do I know!?

they would make no profit on it? No. Clearly they would make a loss. It is worth more than that.

Is this legal?Yes of course
Is there any tax implications for it? Yes Or anything else you can think off
It is not their home btw

1) Deprivations of Assets. If they ever need care in future off the LocalAuthority, the LA will asses their assets as if they has sold at today's market value. Giving away assets or selling below value would be seen simply as a way to claim Benefits

2) CapitalGains Tax. as it is not their home, CGT will be due on the increase in market value from date of purchase to date of sale.

3) SDLT - you would pay SDLT on your purchase at the price you pay

4) Inheritance Tax. If they die within 7 years, the difference between market value and price you pay will be added to their Estate for IHT.

5) you ask what else we can think of so: have they taken finacial advice before suggesting or agreeing to this? Do they understand the implications? What other assets, debts, income do they have? What are their future needs (known or unknown)?

hazyjo

foxy-stoat wrote: »

Originally the field and house was going to be gifted to the OP, now they want to buy it @ 2004 prices to "help them out".

As already stated, buying it at the market rate would be a better idea as they may fall foul of deprivation of assets.

I know. There may have been an element of sarcasm in my post...:o

AdrianC

I presume the property's let. So the first thing to do would be to give the tenants notice - I do hope all the paperwork's in order.

CGT is still going to be due based on the actual value, not the discounted sale price, unless they fancy lying to the tax man...

smcg2011

It’s a very old house which has been in the family for approx 150years this is why they bought from the uncle who was selling it at the time. This is also why they are willing to sell it to us for what they bought it for back then. No planning passed on the field but they were going to give us the field as a gift to help us out . Now that my partners father suffered a bad work injury forcing him to retire, and his wife already retired they said we could buy the house and field together for 60k . For anyone saying this only helps us out, yes they want to still help us on the property ladder but also need money to survive as both are retired. They also want the land and property kept in the family that’s why they don’t want to put on open market even thought they would get more money for it. Sentimental reasons etc . But as the property is quiet old and would need a lot of work it wouldn’t make sense for us to pay today’s values either. If we had to we would be safer just buying a new build down the road needing no work .