Renting Parents Elderly Property - Legal Position?

cloud_dog

Hi

Was hoping someone might have some knowledge or experience in this area.

My mother has now been placed in a residential care and is suffering from early stage onset of dementia.  Myself and my brother have PoA and have been managing her bills, savings, investments for a while now but, we are now in the situation where we need to make decisions over my mothers property; rent / sell.  The idea was to rent it for the foreseeable future, so as to add to the liquid assets to support her care and then as those assets run down we would eventually sell the property.

My question relates to something I heard or read recently, and relates to the fact that we (myself/brother) may not have the legal authority to rent out the property, despite having PoA for our mother.  Is anyone able to confirm, comment. point in the right direction regarding this aspect?

TIA

user1977

I doubt we can, without some clues about where you heard or read it!

There's no reason in principle why an attorney can't let out a property, assuming the POA gives you the relevant powers. Whether it makes sense for your mother to start a residential letting business at this stage in her life is a different question.

tacpot12

Unless the PoA says you cannot rent her property out, I don't see why you can't. With the PoA you would be able to take legal action in your mother's name to evict tenants, so you are not going to placing her in a situation that you cannot then get her out of. 

Note that as an Attorney you cannot given evidence to the court as the donor. You can give your own evidence, but you cannot give evidence as the donor (i.e. you can't tell the court only things that the donor would know to be true based on their experience). As any rental would be setup by you, with the donor having no knoweldge of any aspect of the rental, I can't see any problem with this. 

This NHS website confirms that you can rent her property out: Giving someone power of attorney - NHS (www.nhs.uk)  While you should not trust the NHS for legal advice, it does, on the face of it, support my reply. 

This solictor's website also confirms this: Powers of Attorney: What Can And Can’t An Attorney Do? | Burt Brill & Cardens Solicitors (bbc-law.co.uk)  I think you take be more confident with this link. 

cloud_dog

user1977 said:

I doubt we can, without some clues about where you heard or read it!

There's no reason in principle why an attorney can't let out a property, assuming the POA gives you the relevant powers. Whether it makes sense for your mother to start a residential letting business at this stage in her life is a different question.

Yes, we are just looking at options TBH, but there is a difference of opinion, hence looking for clarification on one aspect.  The starting point is likely to be sale just for a degree of certainty for the finances.

cloud_dog

tacpot12 said:

Unless the PoA says you cannot rent her property out, I don't see why you can't. With the PoA you would be able to take legal action in your mother's name to evict tenants, so you are not going to placing her in a situation that you cannot then get her out of. 

Note that as an Attorney you cannot given evidence to the court as the donor. You can give your own evidence, but you cannot give evidence as the donor (i.e. you can't tell the court only things that the donor would know to be true based on their experience). As any rental would be setup by you, with the donor having no knoweldge of any aspect of the rental, I can't see any problem with this. 

This NHS website confirms that you can rent her property out: Giving someone power of attorney - NHS (www.nhs.uk)  While you should not trust the NHS for legal advice, it does, on the face of it, support my reply. 

This solictor's website also confirms this: Powers of Attorney: What Can And Can’t An Attorney Do? | Burt Brill & Cardens Solicitors (bbc-law.co.uk)  I think you take be more confident with this link. 

Many thanks for the information and links, very useful.

Giddypip

Why put yourself through the stress of becoming landlords? If it was me, I would sell the house and put the money towards any savings she already has. You can then concentrate on your mother and spending whatever time you can with her rather than sorting out tenancy problems.

canaldumidi

There is no reason why you cannot let the property using the POA, unless the terms of the POA prohibit this which is unlikely.

Provide a link to where you heard otherwise if you want more detailed response.

Of course, as POA you must act in her best interests, so for example letting to eg her grandchildren at below market rate might expose you legally.

But I'd urge caution anyway. Letting the property entails compliance with many laws and regs (and associated costs!), and also ties up her asset pretty firmly. You can't easily access the equity if you need to.

And worst case, you get tenants from hell who don't pay rent for months on end and who it takes you many months (year+?) to evict. Meanwhile how do you fund mum's care.....

See aso my posts here:

Post 7: New landlords (1):advice & information :see links in next post

Post 8: New landlords (2): Essential links for further information

TadleyBaggie

This was a suggested plan when my FiL died, MiL was in a care home and would never return home. When the home was surveyed it revealed that £30-40K needed to be spent to bring it up to a rental standard. This didn't make any sense and so we decided selling made more sense.

bouicca21

Thought about renting out my mother’s house but the practicalities meant that selling made more sense.  Firstly the rent would not cover the fees.  Secondly all the regulations around renting and the need to carry out a few improvements (even just decorating would be a faff).  And thirdly we would have had to clear the place - even if some of the furniture stayed (and let’s face it what seemed ok to a 90 year old would have had little appeal to potential renters) all the drawers and cupboards would have to be emptied.  The location of mum’s place meant potential renters would probably have been youngish professionals - there was  no way that sort of person would want to live with the sort of decor and furnishings that mum lived with.

dimbo61

You need an EPC £50/70 to rent or sell.
If it's an old house with poor insulation and single glazing, no central heating you may find the EPC is F or G ( SELL)
EICR which can cost £200 plus cost of any electrical works that need doing.
Gas Safe Certificate and boiler service.
Fit for human habitation checks ?
Smoke alarms and carbon monoxide alarms, heat alarm in Kitchen.
Maybe fire doors and turn locks on exit doors.
Landlord insurance.
Clearing the property and upgrades to attract the right kind of tenant.
What happens if mum dies and you want or need to sell ASAP and have a tenant on a 12 months tenancy agreement who won't leave and stops paying rent !
The backlog in the courts means it could take 18/24 months to evict.
You need to get everything right before renting including Inventory ( Video ) and water tight tenancy agreement with guarantors just in case.
Selling now seems a good idea to me 

AdrianC

cloud_dog said:

My question relates to something I heard or read recently, and relates to the fact that we (myself/brother) may not have the legal authority to rent out the property, despite having PoA for our mother.  Is anyone able to confirm, comment. point in the right direction regarding this aspect?

The only likely issue is that any decisions you make as attorneys have to be in the person's best interests.

Is renting it out in her best interests? Unlikely.

There isn't much of an upside - there's no way that the rent will anywhere near keep pace with her care costs, so you're still going to need to have other assets available to cover them.

There's plenty of downsides.

The only reason not to is if you think you want the house to remain available for a possible future bequest... And that's not a totally separate thing to HER interests...

BTW, having been in the same situation, I can heartily recommend you read... 
https://www.amazon.co.uk/Contented-Dementia-Revolutionary-Wraparound-Well-being/dp/0091901812