PLEASE READ BEFORE POSTING

Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.

Helping Dad buy council flat, will it affect me from getting 'first home' benefits?

Options
2

Comments

  • Norman_Castle
    Norman_Castle Posts: 11,871 Forumite
    Photogenic First Post Name Dropper First Anniversary
    Options
    AdrianC wrote: »
    Apart from a possible increase to your eventual inheritance subsidised by council tax payers and those denied a future council home, is there any actual benefit for your father in owning his flat, with the increased costs and decreased security of tenure that carries?

    As explained to you in a previous thread, council housing is not subsidised by council tax payers. Council housing is self financing.

    Housing Revenue Account - Income and Expenditure Statement
    The Housing Revenue Account (HRA) reflects a statutory obligation to maintain a revenue
    account for local authority housing provision in accordance with Part VI of the Local
    Government and Housing Act 1989. The Account is required to be self-financing and cannot
    subsidise or be subsidised by the General Fund    .     The HRA Income and Expenditure
    Statement shows the economic cost in the year of providing housing services in accordance
    with generally accepted accounting practices, rather than the amount to be funded from
    rents and government grants. The Council charges rents to cover expenditure in accordance
    with regulations; this may be different from the accounting cost. The increase or decrease in
    the year, on the basis of which rents are raised, is shown in the Movement on the HRA
    Statement.
  • AdrianC
    AdrianC Posts: 42,189 Forumite
    First Anniversary Name Dropper First Post
    Options
    Norman_Castle wrote: »
    As explained to you in a previous thread, council housing is not subsidised by council tax payers. Council housing is self financing.
    Perhaps you might care to re-read what I wrote?

    The RTB discount does provide a potential subsidy for the OP's inheritance by council tax payers, since the OP's father exercising that discount will undoubtedly result in increased costs to the local authority.
  • Norman_Castle
    Norman_Castle Posts: 11,871 Forumite
    Photogenic First Post Name Dropper First Anniversary
    Options
    Pk_King_X11 wrote: »
    The question is, should I appear as a joint tenant in the application form?
    Are you currently a joint tenant? If not then no.
  • Norman_Castle
    Norman_Castle Posts: 11,871 Forumite
    Photogenic First Post Name Dropper First Anniversary
    Options
    AdrianC wrote: »
    Perhaps you might care to re-read what I wrote?

    The RTB discount does provide a potential subsidy for the OP's inheritance by council tax payers, since the OP's father exercising that discount will undoubtedly result in increased costs to the local authority.
    How?........
  • AdrianC
    AdrianC Posts: 42,189 Forumite
    First Anniversary Name Dropper First Post
    Options
    Norman_Castle wrote: »
    How?........
    Quite simply because either the people who would have been housed by the council need to be housed elsewhere, resulting in higher HB payments, or the council need to spend more than they've received on replacing that stock.
  • silvercar
    silvercar Posts: 46,962 Ambassador
    Academoney Grad Name Dropper Photogenic First Anniversary
    Options
    AdrianC wrote: »
    Quite simply because either the people who would have been housed by the council need to be housed elsewhere, resulting in higher HB payments, or the council need to spend more than they've received on replacing that stock.

    Only if the people being housed rely on HB payments. They may be workers self financing but in need of a home.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • silvercar
    silvercar Posts: 46,962 Ambassador
    Academoney Grad Name Dropper Photogenic First Anniversary
    Options
    AdrianC wrote: »
    Apart from a possible increase to your eventual inheritance subsidised by council tax payers and those denied a future council home, is there any actual benefit for your father in owning his flat, with the increased costs and decreased security of tenure that carries?

    Once the mortgage is paid off, there will be no rent or mortgage to pay.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • Norman_Castle
    Norman_Castle Posts: 11,871 Forumite
    Photogenic First Post Name Dropper First Anniversary
    Options
    AdrianC wrote: »
    Quite simply because either the people who would have been housed by the council need to be housed elsewhere, resulting in higher HB payments, or the council need to spend more than they've received on replacing that stock.
    You're assuming these other people will receive housing benefit.
    Any money spent replacing these homes will be repaid from rental income. Thats how self financing works.

    You're intent on finding reasons to claim council tax payers fund social housing.
  • antrobus
    antrobus Posts: 17,386 Forumite
    Options
    Pk_King_X11 wrote: »
    ..The question is, should I appear as a joint tenant in the application form? Am I required? What are the benefits of being a joint tenant? Will it prevent me from getting government's benefits later on when I'm buying my own first home (probably with the help of my dad)?

    Thanks.

    G_M has given you the correct answer.

    If your father can qualify for a mortgage on his own, then he can purchase this RTB property in his own name. You can pay your father rent, to help him clear the mortgage "quickly". You can make whatever private arrangement you wish with your father regarding any help he later provides.
  • Pk_King_X11
    Pk_King_X11 Posts: 3 Newbie
    Options
    Thanks for all the replies!
    AdrianC wrote: »
    is there any actual benefit for your father in owning his flat?
    silvercar wrote: »
    Once the mortgage is paid off, there will be no rent or mortgage to pay.

    Exactly. Plus, we could sell that flat for a 50% profit after 5 years (which we have no desire in doing though).
    IAmWales wrote: »
    I expect they're wanting their 50% freebie to finance the second ;)

    If it's legal, I don't see a problem here. This is a money saving forum is it not? It's not like I'll have 2 houses. My dad will have his, I will have mine. They will both be our first homes. That is fair.
    antrobus wrote: »
    G_M has given you the correct answer.

    If your father can qualify for a mortgage on his own, then he can purchase this RTB property in his own name. You can pay your father rent, to help him clear the mortgage "quickly". You can make whatever private arrangement you wish with your father regarding any help he later provides.

    Thanks. Another question. If my dad wishes to give this place to me in the far future, will it be difficult without being a joint tenant? Is there tax to pay or something? Or can he just give it to me just like that?
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

Categories

  • All Categories
  • 343.2K Banking & Borrowing
  • 250.1K Reduce Debt & Boost Income
  • 449.7K Spending & Discounts
  • 235.3K Work, Benefits & Business
  • 608.1K Mortgages, Homes & Bills
  • 173.1K Life & Family
  • 247.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards