Apparently IHT on may not be too bad?

artyboy

RogerPensionGuy said:

zagfles said:

Albermarle said:

poseidon1 said:

RogerPensionGuy said:

bjorn_toby_wilde said:

ader42 said:

LHW99 said:

The probelsm is many farmers live on the farm, and even when the children take over most of the heavy work, they will still be helping out at busy times. They will often have nowhere but the farmhouse to live, so if they try to pass it on earlier, unless they have enough income to pay a commercial rent to the children, it will become a gift with reservation.

It is however quite straightforward to split a farm house from the fields, sheds etc. into a separate land registry title and hence a separate “property”.

They can keep the house and gift the rest. 

I know someone who did just this very thing a couple of years ago very easily and cheaply.

I suspect the reason farmers don’t pass on their “wealth” before they die is the same as other persons; self-interest in being a matriarch / patriarch and perhaps fear of needing to fund care. I’m sure we all know single elderly people rattling around in big houses, I do. Old people need to start passing their wealth down the line before they retire imho. better that than giving it to HMRC. 

We’re a couple doing exactly that. Rattling around in a big house. Our close friends are doing exactly the same.

The problem we face is a lack of anything desirable or aspirational to move into.  I can’t help thinking this is a failure of local (and national) planning. In this country we are beholden to less than 10 development companies who build identikit houses on tightly packed estates with insufficient parking or green space. I would love to move out of my house, but can’t find anything I would want to move into.

My elderly parents want to move back into the town from a nearby village but they need a small bungalow. Of the nearly 1500 new builds near us they haven’t built a single bungalow. The council tried to push the developers to include some on the last new build but in vain.

I nearly choked on my cornflakes when I saw the current government characterise the planning system as being blocked by NIMBYs. Nothing could be further from the truth. From what I’ve seen locally the developers decide what and where they want to build and dare the planning department to stop them. If blocked they appeal to the planning inspectorate who overrule the decision.

Yes indeed planning has been so inadequate on so many fronts. 

Many couples or singles living in big houses due to so may dynamics, many young people living and renting 3 people in a 3 bed flat or somtines 4, 5 or 6 in a 3 bed flat. 

There's no quick fix unfortunately, house ownership mobility in the UK is just so problematic, hassle and extremely costly, it's a crazy situation, but I expect it to get worse. 

There is also an intractable  mindset issue.

A friend of mine just hitting 70 says he would have happily decamped from  their 4 bed house  (owned over 40 years) to something smaller in the shires and free up spendable capital as a bonus. His wife will have none of it. Determined to stay in the locality where her longstanding friendship group reside, and retain the excess bedrooms for the rare occasions grown up sons return for short visits.

I feel a little sorry for him since from my single carefree perspective , he seems to be a hostage to his spouse's wants and desires in terms of where and how they live. 

Outside of this example, I professionally encountered many widows who could not see the benefit of downsizing from large family homes they could no longer really manage, but resisted any exhortation by their children to sell up and downsize, more often than not on entirely sentimental grounds.

Would like to think this sentimentality of the boomer generation in such matters will be slowly replaced by a more analytical sense of realism by the generations that follow, but I wouldn't bet on it.

It maybe sounds a bit pathetic to someone single, but there is a lot of mileage in the phrase ' Happy Wife, Happy Life '

If your friend forced a move ( if possible) and it did not work out, then he would not be having a very happy old age.

It sounds pathetic to someone married  There's the possibility of compromise eg stay local so still in contact with friends but move to somewhere smaller, and get a sofabed for visitors. 

I know a few people, couples who downsized locally making life much much more relaxed, more time with local friends and the community, plus lots more ability to travel, holidays, see people, see family all over the place and few months overseas during the UK winter is a real nice break.

However, I know couples who get their pension TFLS and move house locally to get another bedroom they don't need to keep up with the Jones. 

It takes all sorts. 

Eh what? That's just flipping nuts. I'd love nothing more than to head back to the sort of 'little cottage on a river' place I used to have before we got the big pile that went with the growing family. Whether we get to go full circle I don't know (for all its faults, where we are now has a lot of advantages beyond just the extra bedrooms). But actually going BIGGER in retirement? Smh...

Incidentally, I thought the phrase was actually

'Happy Wife.
Oxy Moron'

  

bjorn_toby_wilde

The other big danger of not downsizing when you can is “if not now, when?”

I’ve seen with my parents and also the neighbours living either side of me, the downside of staying too long in a house that’s too big. As you age they become far too much to manage.

Paying for a cleaner or gardener would be an option, and using up some of your cash to make life easier reduces the IHT burden, but actually finding reliable people can be very difficult.

Sea_Shell

bjorn_toby_wilde said:

The other big danger of not downsizing when you can is “if not now, when?”

I’ve seen with my parents and also the neighbours living either side of me, the downside of staying too long in a house that’s too big. As you age they become far too much to manage.

Paying for a cleaner or gardener would be an option, and using up some of your cash to make life easier reduces the IHT burden, but actually finding reliable people can be very difficult.

Personally, the main factor in being able to downsize to somewhere suitable, is if you can find detached.   

Many of us have made it to the 3/4 bed detached, and like not having direct neighbours, and want to keep it that way.    
Finding smaller properties that are the "same" just smaller is very difficult. 

Also, if you want to move to a nicer area (quieter etc), then the move will likely be sideways, financially, and so not actually release much in the way of capital, especially after fees. 

  

Cobbler_tone

artyboy said:

RogerPensionGuy said:

zagfles said:

Albermarle said:

poseidon1 said:

RogerPensionGuy said:

bjorn_toby_wilde said:

ader42 said:

LHW99 said:

The probelsm is many farmers live on the farm, and even when the children take over most of the heavy work, they will still be helping out at busy times. They will often have nowhere but the farmhouse to live, so if they try to pass it on earlier, unless they have enough income to pay a commercial rent to the children, it will become a gift with reservation.

It is however quite straightforward to split a farm house from the fields, sheds etc. into a separate land registry title and hence a separate “property”.

They can keep the house and gift the rest. 

I know someone who did just this very thing a couple of years ago very easily and cheaply.

I suspect the reason farmers don’t pass on their “wealth” before they die is the same as other persons; self-interest in being a matriarch / patriarch and perhaps fear of needing to fund care. I’m sure we all know single elderly people rattling around in big houses, I do. Old people need to start passing their wealth down the line before they retire imho. better that than giving it to HMRC. 

We’re a couple doing exactly that. Rattling around in a big house. Our close friends are doing exactly the same.

The problem we face is a lack of anything desirable or aspirational to move into.  I can’t help thinking this is a failure of local (and national) planning. In this country we are beholden to less than 10 development companies who build identikit houses on tightly packed estates with insufficient parking or green space. I would love to move out of my house, but can’t find anything I would want to move into.

My elderly parents want to move back into the town from a nearby village but they need a small bungalow. Of the nearly 1500 new builds near us they haven’t built a single bungalow. The council tried to push the developers to include some on the last new build but in vain.

I nearly choked on my cornflakes when I saw the current government characterise the planning system as being blocked by NIMBYs. Nothing could be further from the truth. From what I’ve seen locally the developers decide what and where they want to build and dare the planning department to stop them. If blocked they appeal to the planning inspectorate who overrule the decision.

Yes indeed planning has been so inadequate on so many fronts. 

Many couples or singles living in big houses due to so may dynamics, many young people living and renting 3 people in a 3 bed flat or somtines 4, 5 or 6 in a 3 bed flat. 

There's no quick fix unfortunately, house ownership mobility in the UK is just so problematic, hassle and extremely costly, it's a crazy situation, but I expect it to get worse. 

There is also an intractable  mindset issue.

A friend of mine just hitting 70 says he would have happily decamped from  their 4 bed house  (owned over 40 years) to something smaller in the shires and free up spendable capital as a bonus. His wife will have none of it. Determined to stay in the locality where her longstanding friendship group reside, and retain the excess bedrooms for the rare occasions grown up sons return for short visits.

I feel a little sorry for him since from my single carefree perspective , he seems to be a hostage to his spouse's wants and desires in terms of where and how they live. 

Outside of this example, I professionally encountered many widows who could not see the benefit of downsizing from large family homes they could no longer really manage, but resisted any exhortation by their children to sell up and downsize, more often than not on entirely sentimental grounds.

Would like to think this sentimentality of the boomer generation in such matters will be slowly replaced by a more analytical sense of realism by the generations that follow, but I wouldn't bet on it.

It maybe sounds a bit pathetic to someone single, but there is a lot of mileage in the phrase ' Happy Wife, Happy Life '

If your friend forced a move ( if possible) and it did not work out, then he would not be having a very happy old age.

It sounds pathetic to someone married  There's the possibility of compromise eg stay local so still in contact with friends but move to somewhere smaller, and get a sofabed for visitors. 

I know a few people, couples who downsized locally making life much much more relaxed, more time with local friends and the community, plus lots more ability to travel, holidays, see people, see family all over the place and few months overseas during the UK winter is a real nice break.

However, I know couples who get their pension TFLS and move house locally to get another bedroom they don't need to keep up with the Jones. 

It takes all sorts. 

Eh what? That's just flipping nuts. 

We are 'nuts'. No kids but definitely upsizing from a 3 bed detached. Nothing to do with the Jones', just because we can and would like a big kitchen/diner and walk-in wardrobe. You are only here once, so my view is enjoy what you can and afford. The fun (quite difficult) part is finding the best location and been enjoying scouting the country at weekends. We are edging towards Norfolk but I also like Dorset and some of Shropshire. Not looking at this as a forever home and could well move to something compact as we get older. I'd agree that it is not the best logic for an old couple to be rattling around a mansion and the challenges that brings.
Property is still a decent investment.  

bjorn_toby_wilde

Sea_Shell said:

bjorn_toby_wilde said:

The other big danger of not downsizing when you can is “if not now, when?”

I’ve seen with my parents and also the neighbours living either side of me, the downside of staying too long in a house that’s too big. As you age they become far too much to manage.

Paying for a cleaner or gardener would be an option, and using up some of your cash to make life easier reduces the IHT burden, but actually finding reliable people can be very difficult.

Personally, the main factor in being able to downsize to somewhere suitable, is if you can find detached.   

Many of us have made it to the 3/4 bed detached, and like not having direct neighbours, and want to keep it that way.    
Finding smaller properties that are the "same" just smaller is very difficult. 

Also, if you want to move to a nicer area (quieter etc), then the move will likely be sideways, financially, and so not actually release much in the way of capital, especially after fees. 

  

That’s exactly my dilemma @Sea_Shell. I don’t need to release any equity, but I’d like to cut down the work involved in maintaining a bigger house and garden.

A small detached place is much harder to find as you say.

Roger175

My Mum and Stepdad are now in their mid 80s and in poor health (him especially). Three years ago Mum phoned me to say they were going to be moving and hoping to find a nice little bungalow. She explained that the stairs was becoming a real issue due to Stepdad's mobility issues, as were steps at the front door etc. Anyway, a month or two rolled by and Mum phoned me to say she had had quite a shock, the Estate Agent had been round, told her the house was worth £450k ish and would sell very quickly, but upon searching, it immediately became obvious that bungalows in her area, were very rare and anything that was on the market was going to cost £500k upwards (and were mostly awful!). Add in the cost of stamp duly, legal fees, removals etc and it was obvious they were going to need to add £100k, which they didn't have.

Fortunately, we found a solution which was for me to convert their downstairs bathroom to a walk-in shower room, partition off their large dining room to make a downstairs bedroom. I also formed a long gentle ramp up to the front door and fitted copious grab rails etc and they now live entirely on the ground floor and only occasionally go upstairs which is treated as storage space.

They should obviously have looked into things years ago, before they reached crunch point, something which we have done, having built ourselves a new property in recent years which is a chalet bungalow with level access, wide doors, downstairs master bedroom/ensuite shower room etc. 

artyboy

Cobbler_tone said:

artyboy said:

RogerPensionGuy said:

zagfles said:

Albermarle said:

poseidon1 said:

RogerPensionGuy said:

bjorn_toby_wilde said:

ader42 said:

LHW99 said:

The probelsm is many farmers live on the farm, and even when the children take over most of the heavy work, they will still be helping out at busy times. They will often have nowhere but the farmhouse to live, so if they try to pass it on earlier, unless they have enough income to pay a commercial rent to the children, it will become a gift with reservation.

It is however quite straightforward to split a farm house from the fields, sheds etc. into a separate land registry title and hence a separate “property”.

They can keep the house and gift the rest. 

I know someone who did just this very thing a couple of years ago very easily and cheaply.

I suspect the reason farmers don’t pass on their “wealth” before they die is the same as other persons; self-interest in being a matriarch / patriarch and perhaps fear of needing to fund care. I’m sure we all know single elderly people rattling around in big houses, I do. Old people need to start passing their wealth down the line before they retire imho. better that than giving it to HMRC. 

We’re a couple doing exactly that. Rattling around in a big house. Our close friends are doing exactly the same.

The problem we face is a lack of anything desirable or aspirational to move into.  I can’t help thinking this is a failure of local (and national) planning. In this country we are beholden to less than 10 development companies who build identikit houses on tightly packed estates with insufficient parking or green space. I would love to move out of my house, but can’t find anything I would want to move into.

My elderly parents want to move back into the town from a nearby village but they need a small bungalow. Of the nearly 1500 new builds near us they haven’t built a single bungalow. The council tried to push the developers to include some on the last new build but in vain.

I nearly choked on my cornflakes when I saw the current government characterise the planning system as being blocked by NIMBYs. Nothing could be further from the truth. From what I’ve seen locally the developers decide what and where they want to build and dare the planning department to stop them. If blocked they appeal to the planning inspectorate who overrule the decision.

Yes indeed planning has been so inadequate on so many fronts. 

Many couples or singles living in big houses due to so may dynamics, many young people living and renting 3 people in a 3 bed flat or somtines 4, 5 or 6 in a 3 bed flat. 

There's no quick fix unfortunately, house ownership mobility in the UK is just so problematic, hassle and extremely costly, it's a crazy situation, but I expect it to get worse. 

There is also an intractable  mindset issue.

A friend of mine just hitting 70 says he would have happily decamped from  their 4 bed house  (owned over 40 years) to something smaller in the shires and free up spendable capital as a bonus. His wife will have none of it. Determined to stay in the locality where her longstanding friendship group reside, and retain the excess bedrooms for the rare occasions grown up sons return for short visits.

I feel a little sorry for him since from my single carefree perspective , he seems to be a hostage to his spouse's wants and desires in terms of where and how they live. 

Outside of this example, I professionally encountered many widows who could not see the benefit of downsizing from large family homes they could no longer really manage, but resisted any exhortation by their children to sell up and downsize, more often than not on entirely sentimental grounds.

Would like to think this sentimentality of the boomer generation in such matters will be slowly replaced by a more analytical sense of realism by the generations that follow, but I wouldn't bet on it.

It maybe sounds a bit pathetic to someone single, but there is a lot of mileage in the phrase ' Happy Wife, Happy Life '

If your friend forced a move ( if possible) and it did not work out, then he would not be having a very happy old age.

It sounds pathetic to someone married  There's the possibility of compromise eg stay local so still in contact with friends but move to somewhere smaller, and get a sofabed for visitors. 

I know a few people, couples who downsized locally making life much much more relaxed, more time with local friends and the community, plus lots more ability to travel, holidays, see people, see family all over the place and few months overseas during the UK winter is a real nice break.

However, I know couples who get their pension TFLS and move house locally to get another bedroom they don't need to keep up with the Jones. 

It takes all sorts. 

Eh what? That's just flipping nuts. 

We are 'nuts'. No kids but definitely upsizing from a 3 bed detached. Nothing to do with the Jones', just because we can and would like a big kitchen/diner and walk-in wardrobe. You are only here once, so my view is enjoy what you can and afford. The fun (quite difficult) part is finding the best location and been enjoying scouting the country at weekends. We are edging towards Norfolk but I also like Dorset and some of Shropshire. Not looking at this as a forever home and could well move to something compact as we get older. I'd agree that it is not the best logic for an old couple to be rattling around a mansion and the challenges that brings.
Property is still a decent investment.  

Oh I agree with the investment argument. And for the length of time you are in a fit state to entertain in a good size kitchen diner, then definitely go for it.

i guess I just see the situation around where I live - lots of big detached houses and old people that have lived in them for half a century or more, gradually letting them slide into disrepair. Then they are shipped off to the care/funeral home, the house goes on the market, and we all get an eyeful of the avocado bathroom suites, the kitchens with a twin tub in it, the ancient divan bedroom sets, and the ducks on the living room wall.

The estate agents have a sliding scale of terminology, going from "would benefit from some cosmetic refreshing" all the way up to "in need of complete modernisation" - the latter features more than the former.

Hopefully I never get to a point where my house ends up like that, but it's clearly an easy trap to fall into!

Cobbler_tone

Roger175 said:

 the Estate Agent had been round, told her the house was worth £450k ish and would sell very quickly

I am sure there are exceptions (even if the price is right) but having been involved in three recent sales, very little sells quickly these days. I'd be surprised if the ones you quoted at £500k+ were flying off the market.

The perfect acid test is to look at Rightmove....most properties have been for sale for some time or have 'reduced' next to them. A house is only worth what someone is willing to pay. We have 3 x 5 bed detached on our (very nice) estate that have been on/off the market for over two years with no takers.

My main house was listed for £420k in Oct 2022 and sold for £345k in Nov 2023, completing in Aug 2024. 
If you are selling a new house (i.e. less than a couple of years old) you will probably face a stumbling block with the deeds needing work or not registered.
 
It's definitely still a buyers market IMO and the best advice is find a solicitor who is going to be all over it.

LHW99

We "downsized" in terms of grounds space, although still 3 beds in a cheaper area. We have made sure there is upstairs / downstairs batrooms, and that the stairs could take a stair lift.

We actually use all three bedrooms ourselves for various things, and are trying to update and increase storage.

Having looked at the local "retirement bungalows", we wouldn't have fitted all our books in, never mind the stuff for other hobbies!

Triumph13

I would rather skip the bungalow and go straight to the retirement apartment in our local town. Being in walking / mobility scooter range of all facilities, plus the organised social events, appeals much more than the isolation of a suburban bungalow.