Mum's flat

Maka29

Our mum lives with us due to poor health and rents out her flat. She's had the same tenants for around 5 years. My sister deals with that side of things, the upkeep and certificates. Mum wants to sell it and help my sister and I out. We know that the tenant will need an official notice but would a friendly email or call beforehand, to say to expect this, be a good or bad idea?

DullGreyGuy

It's more friendly to give them a heads up and depending on if you intend to vacate them before starting the sales process or not you may want to be on good terms with them if you want estate agents to be showing potential buyers around whilst they are still living there. 

theartfullodger

No "official" notice required if friendly approach works.  I've explained to tenants in the past what I was doing and why and said )if justified) I'd give excellent references and be flexible of dates (IE could be slow or very quick eg 3 days from today if it suited them).  Worked for me.

Which country (eg Wales, NI?).  Law and formal notices vary: a lot.

Maka29

That's good points. I thought going the friendly route was best but big sis was dubious. I'll also say about giving good references and being flexible on dates 

Maka29

The flat is in Scottish Borders. 

FreeBear

DullGreyGuy said:

It's more friendly to give them a heads up and depending on if you intend to vacate them before starting the sales process or not you may want to be on good terms with them if you want estate agents to be showing potential buyers around whilst they are still living there. 

Might even find that the tenants would be interested in purchasing the flat themselves. If so, that could save on estate agent fees and having to go through the eviction process.

sheramber

Mum wants to sell it and help my sister and I out. 

Be aware of deprivation of assets if your mother needs care or to go into residential care. 

Grumpy_chap

Maka29 said:

Our mum lives with us due to poor health and rents out her flat. She's had the same tenants for around 5 years. My sister deals with that side of things, the upkeep and certificates. Mum wants to sell it and help my sister and I out. We know that the tenant will need an official notice but would a friendly email or call beforehand, to say to expect this, be a good or bad idea?

Is any of this with you or your sister acting a PoA for your mother?  Gifting from your mother to your sister and you can be complex if there is PoA active.

What is the status of the tenants?  
They have been in the property for 5 years.  Are they likely to want to stay for many more years or is it likely they will naturally move on in the near future?  A natural break might be worth waiting for if, for example, an increase in the number of children means the property is too small.

Would the tenants be likely to wish to buy the property?

Maka29

There is a Poa written and logged with a government body. I think it was the court but not sure.
How would this affect the gift? I didn't think of that. 
It's only active if she loses mental capacity so it's not kicked in yet as she has full mental capacity. Mum decided to sell up as my son wants to get on the property ladder. It's her way of helping out.

Grumpy_chap

Maka29 said:

There is a Poa written and logged with a government body. I think it was the court but not sure.
How would this affect the gift? I didn't think of that. 
It's only active if she loses mental capacity so it's not kicked in yet as she has full mental capacity. Mum decided to sell up as my son wants to get on the property ladder. It's her way of helping out.

The potential issue with the PoA (if it is or becomes active) is that, acting as Attorney for your Mother, any decision has to be made with the best interests and solely for the benefit of your Mother. 

Should the PoA be active (thus indicating that your Mother had some extent of diminished capacity), then it would be difficult for you and your Sister to sell the flat and make a gift to yourselves (or your children) and for you to demonstrate the benefit to your Mother.

There is devil in the detail.
Selling the flat could be explained as for the benefit of your Mother if she no longer had the capacity to manage the property herself, thus relieving a stressor, plus it is yielding a cash pot that can be used for your Mother's day-to-day expenses or to meet care needs should they arise.
The gifting can be explained if there is a prior history and pattern of similar gifting.  There often would not be.

pinkshoes

Maka29 said:

There is a Poa written and logged with a government body. I think it was the court but not sure.
How would this affect the gift? I didn't think of that. 
It's only active if she loses mental capacity so it's not kicked in yet as she has full mental capacity. Mum decided to sell up as my son wants to get on the property ladder. It's her way of helping out.

What's her physical health like? How long is she likely to live? (sorry if that's a little blunt!!).

If your mum required care, then how would this be paid for? If you can't afford to pay for it yourselves, then the council will assess the finances, and if they find she has recently sold the house and given away the proceeds, then this would be seen as deprivation of assets.

https://www.independentage.org/get-advice/health-and-care/paying-for-care/giving-away-assets-to-pay-for-care

I think you'd also need to look at tax due on any lump sum if she dies within 7 years of the gift.

Best to take advice from a financial expert.