Buying for a student daughter

badger09

I agree with everyone who says ‘don’t do it’. Let her rent with other students from a 3rd party, and help her out if you wish. 

Just thought I’d mention, assuming you are one of the beneficiaries of your late parent’s will, you can do a Deed of Variation so that all it part of your inheritance goes direct to your daughter. Together with her £30k savings & her inheritance that should provide her with a substantial deposit when she is ready to buy her 1st home. A position many young people can only dream of. 

LegallyLandlord

anselld said:

LegallyLandlord said:

Unless you buy it with a company, you can’t set off the mortgage interest payments against profits: 

https://theindependentlandlord.com/is-a-limited-company-best-for-landlords/

That is only partially true if the rental income takes you into the higher rate tax bracket.  (which is increasingly likely with the freeze on allowances).  However, even higher rate tax payers can still offset half of their mortgage interest.

That's right. I should have been more precise. You can only set the mortgage interest off against basic rate tax. The blog post makes it clear, but my answer didn't. Sorry about that!

macman

It will only be an HMO if each tenant has a separate tenancy agreement. With 3 occupants, the usual arrangement will be a joint tenancy, an, if one leaves, the other two must find a replacement as they are jointly and severally liable for the rent.

dimbo61

However there are lenders who will lend to students if Mum and Dad act as guarantors!
Your daughter would be the owner ( First time buyer ) and could use her LISA if over 12 months. She could have 1/2 lodgers  under the Rent a room scheme.
As a HMO student landlord I think it's a terrible idea unless she is training to be a doctor or Vet (5/7 year course )
Buying and selling costs over 2/3 years is not worth it.
Don't forget the EPC, EICR, GSC, pat testing, right to rent checks, how to rent, deposit, Article 4 and fire safety regs.
https://www.onlinemortgageadvisor.co.uk/income-types/student-mortgages/

https://www.bathbuildingsociety.co.uk/mortgages/browse-mortgages-by-product-type/buy-for-uni/

https://www.thevernon.co.uk/mortgages/buy-for-uni/

artyboy

OP - a year ago I was in a very very VERY similar situation to you, elder daughter in year 1 away at Uni, and we were considering buying a place as an investment, but before we'd even started working through the nitty gritty of whose name it would go in etc, she decided to live with a group of friends, one of whose parents owned a house. 

In hindsight, I think we dodged a bullet. Would have been far more trouble than it was worth for all the reasons mentioned by others here...

subjecttocontract

We also had a lucky escape.
Our youngest son got a uni place and we intended to buy a 4 bed house for him to live in & rent the other rooms to students. Most of the houses were Edwardian or Victorian and we decided that buying a 100+ year old house, 150 miles from home and filling it with students was not a good idea. 

ElmoR

Thank you for all your answers and signposting to resources!

The consensus would be a (screaming head emoji) "NOOOOO, don't do it!" then

anselld

macman said:

It will only be an HMO if each tenant has a separate tenancy agreement. With 3 occupants, the usual arrangement will be a joint tenancy, an, if one leaves, the other two must find a replacement as they are jointly and severally liable for the rent.

The housing act definition of HMO is three or more occupants from two or more households.  The tenancy type (joint or individual) is not relevant.

On the other hand depends on the tenacy type and any joint tenancy is not an HMO for Council Tax.

lookstraightahead

ElmoR said:

Thank you for all your answers and signposting to resources!

The consensus would be a (screaming head emoji) "NOOOOO, don't do it!" then

What makes you think that? 🤣

macman

anselld said:

macman said:

It will only be an HMO if each tenant has a separate tenancy agreement. With 3 occupants, the usual arrangement will be a joint tenancy, an, if one leaves, the other two must find a replacement as they are jointly and severally liable for the rent.

The housing act definition of HMO is three or more occupants from two or more households.  The tenancy type (joint or individual) is not relevant.

On the other hand depends on the tenacy type and any joint tenancy is not an HMO for Council Tax.

But 3 students (or any other category) living together in one dwelling place and sharing cooking and washing facilities does 'form a household'. They don't have to be married/related or in a relationship to be classified as a household.