Agreement between family

dimbo61

Join NRLA and use the tenancy agreement they supply.
Get EICR GSC EPC and pat testing done.
Do right to rent checks, serve how to rent leaflet and deposit information and prescribed information if you take a deposit.
Read up about Fit for habitation requirements and have video inventory with report signed by both tenants and landlords.
Make it clear who is responsible for garden ?

Cherylrp

dimbo61 said:

Join NRLA and use the tenancy agreement they supply.
Get EICR GSC EPC and pat testing done.
Do right to rent checks, serve how to rent leaflet and deposit information and prescribed information if you take a deposit.
Read up about Fit for habitation requirements and have video inventory with report signed by both tenants and landlords.
Make it clear who is responsible for garden ?

Thank you for all that info much appreciated.

fiwen30

Cherylrp said:

Pennylane said:

Cherylrp said:

Pennylane said:

renting to a family member or a friend is never a good idea.  I’ve seen family bust ups and ruined friendships many times.  
It’s also worth remembering if she is on certain benefits and gets behind with her rent you will be expected to grin and bare it because you are “family”.  

I hear what you are saying and understand what you are saying and I hope none of this ever happens but if the worse happened we would deal with it.   

as long as you are aware and understand that this could cost you money rather than make you money, that’s fine. As others have said, it is vital that you do everything by the book, EPC, EICR, Tenants Rights booklet, Deposit Protection, Gas safety checks, etc etc.  

I will do it correctly and I know it won’t make me money but it will contribute to the income that we have both lost due to health reasons.  Thank you all for you help a lot of reading is required I think.  

If you’re going to be a cash buyer, wouldn’t it be best to use that cash as a contribution to your reduced income, rather than waiting for the sister to have paid x-amount in rent to cover the cost of the house purchase, before her rent starts to contribute to said reduced income?

Or if you’re planning to sell this house down the line and have the sister move in with you, why not have her move in now & pay rent/lodging to make up your income, or all go in together with the cash money you have available now and buy a property for all of you?

AnotherJoe

I really wouldn't bother with the deposit. It's not required and it's purpose is protection for the LL in case the tenant damages the property or reneges on rent so that you can at least recover some of that by withholding the deposit.
 But neither of those two situations would seem to be present here so simplify at least a little bit by omitting that. 

AlexMac

I know everyone advises against letting to a family member, but if you want anecdotal evidence, that's more or less what I did... well over 20 years ago. 

Used my redundancy money to buy a little ex-local authority flat so that the daughter of my then girlfriend, a single parent with a baby, could get out of her damp and grimy rental on the polluted SE London floodplain, and move into a brighter airy place on the hill-crest above the smogs (my mate was head environmental honcho in the East End Council just across the river, and he horrified me with tales of poor air quality washing through the Thames basin on prevailing westerly winds!)

Glad we didn't have forums like this then, cos if I'd asked, I might have been put off.  Google hadn't even been invented and this website (MSE) had to await the next Century.  

So what went wrong you ask? Unpaid rent? Trashed flats? Family fall-outs? Fianancial catastrophe?

Nope; went like a dream!  As Jane Austen said,  "Reader, I married her" (the girlfriend, that is).  Daughter & baby eventually moved on; lots of lucrative subsequent lets , all legal and taxed, and,  as the area's come up. the flat's now worth probably worth seven or eight times its initial purchase cost of £34k.  So the Chancellor will enjoy a nice CGT bung when we ever sell. 

And best of all, the baby/grand daughter is now a strapping 25 year old who, furlough and a spot of COVID- related redundancy aside, has never been out of work; and don't even know she's made us a coupla hundred grand in CG (well, actually, she does, as we told her!)  In fact as that flat did so well, we bought another "nice little earner" ten years later

So forget the deposit- just focus on the relationship!  But buy something easily sellable or lettable, with low overheads, no cladding, and preferably no lifts or flat roof, so you can make money on it as a sale or let if she moves on.

Pennylane

AlexMac said:

I know everyone advises against letting to a family member, but if you want anecdotal evidence, that's more or less what I did... well over 20 years ago. 

Used my redundancy money to buy a little ex-local authority flat so that the daughter of my then girlfriend, a single parent with a baby, could get out of her damp and grimy rental on the polluted SE London floodplain, and move into a brighter airy place on the hill-crest above the smogs (my mate was head environmental honcho in the East End Council just across the river, and he horrified me with tales of poor air quality washing through the Thames basin on prevailing westerly winds!)

Glad we didn't have forums like this then, cos if I'd asked, I might have been put off.  Google hadn't even been invented and this website (MSE) had to await the next Century.  

So what went wrong you ask? Unpaid rent? Trashed flats? Family fall-outs? Fianancial catastrophe?

Nope; went like a dream!  As Jane Austen said,  "Reader, I married her" (the girlfriend, that is).  Daughter & baby eventually moved on; lots of lucrative subsequent lets , all legal and taxed, and,  as the area's come up. the flat's now worth probably worth seven or eight times its initial purchase cost of £34k.  So the Chancellor will enjoy a nice CGT bung when we ever sell. 

And best of all, the baby/grand daughter is now a strapping 25 year old who, furlough and a spot of COVID- related redundancy aside, has never been out of work; and don't even know she's made us a coupla hundred grand in CG (well, actually, she does, as we told her!)  In fact as that flat did so well, we bought another "nice little earner" ten years later

So forget the deposit- just focus on the relationship!  But buy something easily sellable or lettable, with low overheads, no cladding, and preferably no lifts or flat roof, so you can make money on it as a sale or let if she moves on.

Great story Alex but you are talking about over 25 years ago and things were very different then.  Now there are all new rules, regulations and legislation landlords have to observe.  As part of his work my OH has to go into loads of private rental properties and he sees both sides of the story.   Just last week he went to a woman who is renting from “a friend” who should have moved in at the beginning of Feb and has been paying rent since then.  She has now discovered that the place needs a lot of work doing to it before she can move in properly .... like all thermostats broken on rads, no heat in bathroom, front door has to be kicked to open, locks on doors insufficient, no cooker, shower broken, kitchen sink damaged and can’t be used.  her “friend” has lower standards than she does and can’t understand what she is complaining about! For example she has suggested to her that she uses a washing up bowl in the sink as she doesn’t want to pay for a new sink to be fitted.  They are now arguing about all the work that needs doing. Looks like the end of a friendship is in sight.  😢

lookstraightahead

AlexMac said:

I know everyone advises against letting to a family member, but if you want anecdotal evidence, that's more or less what I did... well over 20 years ago. 

Used my redundancy money to buy a little ex-local authority flat so that the daughter of my then girlfriend, a single parent with a baby, could get out of her damp and grimy rental on the polluted SE London floodplain, and move into a brighter airy place on the hill-crest above the smogs (my mate was head environmental honcho in the East End Council just across the river, and he horrified me with tales of poor air quality washing through the Thames basin on prevailing westerly winds!)

Glad we didn't have forums like this then, cos if I'd asked, I might have been put off.  Google hadn't even been invented and this website (MSE) had to await the next Century.  

So what went wrong you ask? Unpaid rent? Trashed flats? Family fall-outs? Fianancial catastrophe?

Nope; went like a dream!  As Jane Austen said,  "Reader, I married her" (the girlfriend, that is).  Daughter & baby eventually moved on; lots of lucrative subsequent lets , all legal and taxed, and,  as the area's come up. the flat's now worth probably worth seven or eight times its initial purchase cost of £34k.  So the Chancellor will enjoy a nice CGT bung when we ever sell. 

And best of all, the baby/grand daughter is now a strapping 25 year old who, furlough and a spot of COVID- related redundancy aside, has never been out of work; and don't even know she's made us a coupla hundred grand in CG (well, actually, she does, as we told her!)  In fact as that flat did so well, we bought another "nice little earner" ten years later

So forget the deposit- just focus on the relationship!  But buy something easily sellable or lettable, with low overheads, no cladding, and preferably no lifts or flat roof, so you can make money on it as a sale or let if she moves on.

I like that story, however, there are very stringent rules which t'internet is good for. It's always good to help out family but you have to be so careful.

AlexMac

Pennylane said:

AlexMac said:

... lots of lucrative subsequent lets , all legal and taxed, and... the Chancellor will enjoy a nice CGT bung when we ever sell. 

Great story Alex but you are talking about over 25 years ago and things were very different then.  Now there are all new rules, regulations and legislation ...(a "friend's") place needs a lot of work doing to it before she can move in properly .... like all thermostats broken on rads, no heat in bathroom, front door has to be kicked to open, locks on doors insufficient, no cooker, shower broken, kitchen sink damaged...  😢

Prudent cautions, Pennylane and lookstarightahead- but amazing how, having initially acted out of altruistic impulse, I somehow subsequently managed to learn how to;

-  comply with all L&T law,  and then, initially with Agents' help, latterly without to find tenants, check references (employer /bank /credit /previous landlords), issue ASTs,  sort Deposit protection...
-  manage the lets myself (to save the faff and fees of an agent) over a dozen 1-4 year tenancies without a bad 'un 
-  find reputable builders to refurbish BTL I's kitchen & bathroom, replace boiler, check, certify and maintain gas, electrics and promptly fix the inevitable plumbing leaks...
- tweak the refurb spec to comply with the demands of a social landlord through which I licence BTL II through; new boiler, strip out gas fire, fit extractors & hard wired smoke /heat detectors... even a new toilet seat, lol!
- replace fridges, dishwashers , washing machines within a day or two of then breaking down; replace beds or matresses every  years or so  
- complete online self assessment..

Or, as "AlexMac said:

... lots of lucrative subsequent lets , all legal and taxed, and... the Chancellor will enjoy a nice CGT bung when we ever sell2. 

On the other hand, maybe the OP, Cherylrp can't face the faff and maybe didn't mean it when she said "Thank you, I do intend to and will read up on exactly what I need to do, I know this now and p.s.  I will do it all legally"?   Or maybe will rethink because she won't enjoy the same house price inflation that we experienced in the nineties and noughties?

Or if having decided to go for it, against some advice above, she will hopefully do it better than moi as, unlike moi, she ain't a Baby Boomer who's so geriatric and analog that they had to research stuff before t'interweb;  in fact so wrinkly they got their COVID Vax among the first!

Best wishes all