Buying or selling 100% of the property owned by two siblings

Skag

Two brothers own a property, 50% each. The property was bought as a present from their parents, so essentially they were given the money to purchase it.

Now, one of the siblings doesn't want to co-own the property, so asked the other one to either buy or sell it to him. The other sibling doesn't want either; he can't buy it (he's an EU resident) nor does he want to sell it.

What are the options for sibling no1? Can he force the selling or purchase of the property? If so, what's the process?

HampshireH

Forcing the sale could be very expensive.

Think he needs to really work on Brother 2. He can't have it both ways (well he can technically but it wont help relations).

Does brother 1 live in it?

Skag

HampshireH said:

Forcing the sale could be very expensive.

Think he needs to really work on Brother 2. He can't have it both ways (well he can technically but it wont help relations).

Does brother 1 live in it?

No he doesn't. And he won't budge as it stands, because the property is let using a MA, and he is benefiting from the rent every month (both are). However, he is also completely hands-off and expects brother 1 to do everything.

What costs are we talking about to force a sale?

TripleH

Fees for selling a house (normal) and the legal fees for forcing a sale of the house using solicitor and the courts.

How exactly is the house owned?

Could the brother here not just move in to the house he owns and live there rent free whilst saving for an onward move?

Cruel, mean yes but forces his siblings hand?

That or deliberately have long voids in the property so the absent sibling has expenses instead of revenue?

Skag

I mean, if the house is to be sold, yes, all the fees and CGT will apply, but nothing can be done about that, since there seems to be a dead end from one side.

How exactly is the house owned?

It was a gift from their parents.

Also, B2, being a resident of another country, he may not want to show evidence of having property abroad, or even transfer the money over to his EU country from the UK, and therefore have to justify it. But that's his problem.

Could the brother here not just move in to the house he owns and live there rent free whilst saving for an onward move?

No, B1 lives in another town far away.

That or deliberately have long voids in the property so the absent sibling has expenses instead of revenue?

Yes, that can always be done, but B1 appreciates his time and money, and doesn't just want to have a property sitting around to prove a point. Then I guess it goes down to ego etc, which is always bad for business.

p00hsticks

If the parents are still alive then I'd be asking them to get involved as it's essentially a problem of their making....

Skag

p00hsticks said:

If the parents are still alive then I'd be asking them to get involved as it's essentially a problem of their making....

Yes, good call, this was explored.

Initially the parents' stance was that "we don't want any change, this is a family owned property for investment purposes", so they wouldn't allow any purchase or sale, or change whatsoever. This was a time where there was no real problem in the co-ownership though.

Eventually, the parents' stance changed to "we bought you a house, do what you want with it".

I guess it is a problem of their making, so involving them again could be an avenue to explore. However, B2 can very well refuse as, legally, he owns 50% of the property, so the parents' involvement would only be of suggestive nature.

user1977

Skag said:

HampshireH said:

Forcing the sale could be very expensive.

Think he needs to really work on Brother 2. He can't have it both ways (well he can technically but it wont help relations).

Does brother 1 live in it?

What costs are we talking about to force a sale?

Depends whether Brother 2 is so stubborn that he not only retains his stance when court action is threatened but tries to defend the court action. And I expect buyers won't fancy being on the other side of a forced sale, so that's likely to affect the price.

In short, "lots". What generally happens though is that the other party comes to their senses when they realise how much it's going to cost them.

user1977

p00hsticks said:

If the parents are still alive then I'd be asking them to get involved as it's essentially a problem of their making....

It might help, though the brothers would both have accepted the position in the first place - you can't unilaterally register property in somebody else's name.

Schwarzwald

Why does B1 want to sell it so desperately?

B1 either has to force B2 for a sale or find a way to incentivize B2 to agree, ie B1 pays for 100% of transaction expenses and equity is shared 50/50.

sourpuss2021

There's normally a line in the title deeds that says such a property cannot be sold without the permission of both 50% owners.

Myself I'm a tenant of a similar property that has been owned 50% by two siblings for nearly 25 years after they were gifted it outright by their parents.   Only one of them is the landlord but I gather they split the rent.  And as tenant I seem to be organising all the maintenance work for them in exchange for slightly cheaper rent.   

They both have plenty of other assets and are content to let it tick along till heaven falls.   No doubt mainly because the CG bill would be so enormous. 

I worry/wonder, though, about the day that one of them passes on and the beneficiaries want to cash in their inheritance. I can't see it would make sense for the surviving owner to buy out his sibling's estate for the other 50% share at the property's value at that future date since the rental yield is now low as the property is so valuable.  Yet the surviving owner may be disinclined to agree to sell up and then face the CG bill on his 50%.   Well, I suppose the two halves of the family would come to a deal and split the liability.

So these situations can be tricky - but if the property is valuable enough, still better than a kick in the teeth!