What to do with mum's house

lindarhead · 13 November 2012 at 3:52PM

My mum, who is in her eighties has recently moved from her home, which she owns outright, into a flat in a sheltered accommodation scheme run by Sanctuary Housing.She wants me to deal with all things concerning her house but I'm not sure which avenue to take. The house is in Stoke-on-Trent, in a reasonable residential area, and is a three-bed terrace in reasonable condition. The central heating was recently replaced, there are some Upvc windows and it has always been reasonably well maintained. My mum wanted to let it out initially but now she thinks that may be too much hassle, however, she didn't really want to sell it as she wanted to leave it for me eventually. So I have a few questions for anyone willing and able to answer. I myself live in a privately rented house so do know the responsibilities of a landlord, and I am thinking that maybe selling would be best, but whilst the house remains unsold mum is claiming housing benefit to help with the rent she now has to pay, once the house is sold I'm presuming she'll be reassessed, so, question one, if we sell it where is the best place to invest the proceeds for the best return which she'll be able to use to supplement her income and use to pay the rent, which will be around £104 per week? Is it possible for me to buy it from her for a nominal amount, or does the fact that she's claiming housing benefit prevent us from doing this? [I'm thinking it does but she wants to know for sure]. I'm assuming that it's too late now for her to turn the house over to me for the same reason, because of the housing benefit situation? And lastly, what exactly are the pitfalls of letting the house out? I'd be grateful for any input regarding any of these queries.

zzzLazyDaisy · 13 November 2012 at 4:13PM

I doubt that the CAB will be able to answer your question, except as far as it relates to housing benefit, as they are only accepting queries on certain defined topics:

dealing with debts and debt disputes – see thread
· housing benefit – see thread
· tax credits & benefits for people in work or looking for work – see thread
· your basic rights at work and redundancy problems – see thread

As far as the house is concerned, as long as it is being actively marketed for sale, it is not counted as a capital asset for HB purposes for 26 weeks. The LA may exercise its discretion to extend this period. As far as selling it to you for a nominal sum, or signing it over to you is concerned - google 'deprivation of assets' but essentially if she does either of those things, she will be deemed to still have the value of the asset and will be assessed accordingly.

Re investing the proceeds of sale, and the pros and cons or renting the house out, I suggest that you deal with these as two separate topics and post them on the relevant MSE boards, where you will find people who are able to give you information and advice.

shopaholicz · 13 November 2012 at 5:04PM

I've been in exactly the same position for the last couple of years. The LA extended the 26 weeks as house sales were really slow. House has just sold after 2 years 3 months on the market. About 1/2 way through this process I was also thinking of buying mums house for about 1/2 the asking price but realised this wasn't to be.

Now, she's been told she can spend some of the money she received, but can't find out how much she can spend on what. The sheltered housing worker who came to visit her suggested she could spend money on new things for the house, but seeing as she's only lived in sheltered housing for just over 2 years it's all like new. She also suggested mum could spend up to £10,000 on a caravan, but what 82 year old wants a caravan?

Anyone out there know what else you could spend some of the money on?

agrinnall · 13 November 2012 at 5:56PM

Whatever route you decide to take to deal with your mum's house, if you don't already have it you should get a Lasting Power of Attorney to allow you to act as if you were your mum without having to constantly either get her to do things or give authorisation every time you need to speak to someone. If you follow the steps carefully it's pretty easy for you and your mum to do it without any help or cost other than the registration fees.

http://www.justice.gov.uk/forms/opg

paddedjohn · 13 November 2012 at 6:08PM

shopaholicz wrote: »

I've been in exactly the same position for the last couple of years. The LA extended the 26 weeks as house sales were really slow. House has just sold after 2 years 3 months on the market. About 1/2 way through this process I was also thinking of buying mums house for about 1/2 the asking price but realised this wasn't to be.

Now, she's been told she can spend some of the money she received, but can't find out how much she can spend on what. The sheltered housing worker who came to visit her suggested she could spend money on new things for the house, but seeing as she's only lived in sheltered housing for just over 2 years it's all like new. She also suggested mum could spend up to £10,000 on a caravan, but what 82 year old wants a caravan?

Anyone out there know what else you could spend some of the money on?

She can spend her money on whatever she likes as long as she isn't doing it just so she can claim benefits.

lindarhead · 13 November 2012 at 9:48PM

Thanks so much for your thoughts and for the link to the LPOA, very much appreciated.

CAB_National_Representative · 14 November 2012 at 1:19PM

lindarhead wrote: »

..........................
So I have a few questions for anyone willing and able to answer. I myself live in a privately rented house so do know the responsibilities of a landlord, and I am thinking that maybe selling would be best, but whilst the house remains unsold mum is claiming housing benefit to help with the rent she now has to pay, once the house is sold I'm presuming she'll be reassessed, so, question one, if we sell it where is the best place to invest the proceeds for the best return which she'll be able to use to supplement her income and use to pay the rent, which will be around £104 per week? Is it possible for me to buy it from her for a nominal amount, or does the fact that she's claiming housing benefit prevent us from doing this? [I'm thinking it does but she wants to know for sure]. I'm assuming that it's too late now for her to turn the house over to me for the same reason, because of the housing benefit situation? And lastly, what exactly are the pitfalls of letting the house out? I'd be grateful for any input regarding any of these queries.

Hi lindarhead - we're not covering investment issues on the CAB board and there are also strict regulations on providing such advice, especially on specific products and services. We have some general information about saving & investing on our Adviceguide website.

We'd recommend getting further advice on the various options across your questions from your local bureau and also an independent financial adviser.

shopaholicz · 19 November 2012 at 12:21PM

She isn't going to spend it just so she could claim benefits. She'd have to spend a lot!!

She just wanted to spend something,,,but lady from sheltered housing told her to be careful and suggested a caravan or new furniture. Mum doesn't want either of these but is thinking of a disability scooter and a few days away. Sheltered housing she's in has a sister scheme in Blackpool. But Mum is now scared that someone will tell her she shouldn't have spent this money. We're only talking about £1,000 in total.

shop-to-drop · 19 November 2012 at 12:29PM

Are you currently renting? If so could you rent your mums house and the rent you pay cover her lost benefits. Then she would be able to leave the house to you eventually.

What to do with mum's house

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