Should he sell Mum's cottage?

bluetint

A friend of mine (no internet so I'm posting this for him) and his two brothers (all in their 60's) inherited, from their parents, a lovely traditional farmhouse in a beautiful location in Wales a few years ago (no mortgage). The house has been a holiday let for some years and they're wondering whether to sell or not. Considering the market at the moment, what would you experts out there advise and what could they do with the money (investment wise) if they did sell? Should they wait until the market is more stable? Should they just hang on to it? Also, what tax issues would they be facing? It was their parents prime residence but not theirs. At a rough estimate, the house is worth £250,000 to £300,000 which of course would be split three ways if sold. I have no idea what this type of house is doing or likely to do in the market at the moment so any views would be gratefully received.

neas

You might have missed the boat to get ahead of the market downturn. Thats a general worry i've picked up reading these boards a sense of "too late".

Its certain that property as an investment is heading for a bit of a turbulent time, then again I'd have thought both american and us stock markets would be going similar ways due to housing market. Some people suggest buying gold/silver as these are age-old ways of stashing cash.

Im not an expert though, just my opinion.

bluetint

Thanks for your input, Neas. That's what I thought though not sure about this particular type of property, I mean as opposed to, say, a flat or new-build. I was wondering if it made any difference - if this type is more stable price-wise.

aztec21

Being such an unique property it should be more stable price-wise. It is usually the worst properties that are hit hardest in a market downturn.

BusyLizzie_3

If they don't need the money for a particular reason, and the holiday let income is covering expenses, I would hang on to it and see what happens in the next 6 months or so.

JoJoArmani

Suppose they would need to work out how much "income" they can get from letting the property v the income the cash would generate if invested elsewhere.

I suppose selling would solve the propblem of any "disagreements" over the property/upkeep etc - then they could do what they please with the cash. Family can get nasty over money and perhaps selling would be easier in this sense.

If they are in no rush they could put the house on the market and see how it goes - whilest still letting it - nothing to lose.

(my Dad sold his 2 bed bungalow on Anglesey last year for £220K - and I thought that was cheap - but I guess in todays market he was lucky to sell!)

Best of luck for your friend!

bluetint

Thanks for the input so far, everyone. It now appears that one brother is wanting to sell as he could do with the money, though the others aren't keen. Anyone any advise about the two getting a mortgage together to buy the third out? The cottage lets quite well. Also, I'm wondering if the one who wants to sell could actually force a sale in spite of the others' reluctance to do so. They're all friends, so far!!

SquatNow

I wouldn't expect to get anywhere near as much money from letting it out during the coming recession.

margaretclare

bluetint wrote: »

Thanks for the input so far, everyone. It now appears that one brother is wanting to sell as he could do with the money, though the others aren't keen. Anyone any advise about the two getting a mortgage together to buy the third out? The cottage lets quite well. Also, I'm wondering if the one who wants to sell could actually force a sale in spite of the others' reluctance to do so. They're all friends, so far!!

Isn't this the difficulty, when a house is bequeathed to more than one person.

People talk about this a lot: 'leaving house to my children', thinking it's a good idea. Any time that you have more than one person involved there is the possibility of disagreement, as you've highlighted. Better by far IMHO for the will to state 'all assets to be turned into cash and then shared out'.

I don't think one of the legatees can 'force a sale' - AFAIK that can only happen in things like bankruptcy or divorce where an official receiver or a judge could make that ruling. The idea of a mortgage is a possibility, but you need expert advice on this.

HTH

Margaret

DGJsaver

just as a situation to add to the thread
My Partner and her brother have been brought up by their granparents as her mother died when she was young , her nan is the surving grandparent , still going strong at 86:beer: she has made my partner power of attorney and the bungalow will be left to her and her brother , last time it was valued it was valued at £300k but that was 5 years ago

Whats the rough guide to this situation , does power of attorney help with forcing or sale (or not) because she isnt sure if she even WANTS to sell , when the time comes...

bluetint

Anyone have any more input? What could they do with the money? Only one is a property owner at present (the one who wants to sell) and would sink his share into extending his current home, but what could the non-property owning brothers (like my neighbour) do (sensibly) with the cash? It wouldn't be enough to buy anywhere outright though would constitute a good mortgage deposit supposing they could get one at their ages. He's never had much money of his own before and says he wants to do the best with it he can so he can leave at least something to his two daughters (he's a widower). I was hoping for some expert tax advise to pass on as well, i.e. how the latest budget affects all this. I notice the worry is having an effect on his health so any cheery advise would be welcome. I did suggest buying out the brother who wants to sell. What are the chances, paying off the mortgage with the lettings? Is it difficult getting a mortgage with a sibling? I read somewhere the value of a house being affected when it's owned by more than one person. Anyone?