Second house query

[shiveringwiggles]

Thinking about buying a little house (£60k ish) for my brother to live in.

He has mental health/addiction issues and council accommodation is unlikely. He has no prospect of ever renting off his own steam, never mind buying somewhere...

My thinking is that this way, he'd have a secure place to live and I'd have an asset if/when he is able to move on.

I wouldn't charge him rent etc but he would need to pay utilities- for this, I'm envisaging adding in an electricity prepayment meter so he can't get into arrears.

Legally/financially/morally etc, any downsides? Anyone done something similar?

[Bells3032]

Firstly i think it's a lovely thing to do for your brother.

You need to consider a few things like:

• council tax don't forget and whether you may be responsible if he doesn't pay
• that if bills don't get paid balliffs may come in and you may have things taken away or a lein but against the house
• take into account extra stamp duty (I don't think you pay on the first £40k but will have to pay 3% on the second 20k which is only about £1k but still needs to be taken into account)
• cost of repairs etc especially if he damages your home

If you think he's in a good enough position that you're not worried about then great. But hard to know from your original message what level of concern you have of unpaid bills etc

[Mamette]

I know of someone who did something similar for their nephew and the place became a doss-house with all sorts of drinking (etc) buddies and opportunists hanging around and pretty much moving in.

If your brother has been through rehab then maybe it would be ok. You sound very kind btw.

[shiveringwiggles]

@Bells3032 ooh, I'll look into the bailiff issue!

@Mamette that is a fear, as he tends to attract people who would take advantage. However, the same thing would happen wherever he went so at least this way I could keep an eye.

[minnieok]

Prepayment meter is a great idea, if he is on benefits might be helpful for him to transfer a set sum to you each payment day and you sort the water, council tax (should be reduced) etc. He might be able to get the housing element to pay rent, there's strict rules regarding relatives but I know people who are doing this so it's possible. You can then save the rent to cover wear and tear

[Thneedville]

Insurance too - as you aren’t living there I think you might need landlord insurance, that then comes with responsibilities on you such as regular gas and electric inspections, and actually I think you’d need a tenancy agreement (even if rent nil).

I agree it’s a lovely thing to do, but only if you can definitely afford to never access that money again (eg if he never moved out)

[Blossomorange]

That’s very kind - he’s lucky to have you as a sister. I would invest in rehab for him instead tho - I think without tackling the root of the issue gifting a house is doomed to fail.

[rottiemum88]

We've just bought a second property for my mum to live. Couple of things that come to mind...

1. Stamp duty - as it's a second property we paid 3% on the whole purchase price
2. Landlord insurance - would have been really difficult to find if the person who'll be living in the property isn't employed or officially retired

[OliviaBenson]

As someone with knowledge of family addiction, my concern is you would just be enabling him. He needs to take responsibility for himself. Sorry op, probably not what you want to hear.

[stillfeelingmad]

Don't have anything to add about addiction but if you're needing a mortgage and landlord insurance you may run into trouble. I rent out my house because I was in negative equity when I moved in with DH, wasn't allowed to rent to family for below market rent I believe

[sbplanet]

"Thinking about buying a little house (£60k ish) for my brother to live in."

What does he think about it? As has been said you might just be 'enabling him', but maybe there's a middle ground where he can 'own' some of it? Responsibility?

[shiveringwiggles]

Interesting points about landlord insurance- I'll look into if.

@sbplanet his credit score is very very very bad. No chance it would be accepted if his name were involved.

[sbplanet]

Ahh sorry @shiveringwiggles, I didn't literally mean own it. I meant have some responsibility for it. I think what has been said about taking responsibility (@OliviaBenson) is important if it is to be more than just a 'prop'. Also important if you want the place to be looked after.

What does your brother thenk about it?

[shiveringwiggles]

@sbplanet ahh, sorry, yes- I misread what you wrote about owning.

He would be thrilled with the idea as he is currently homeless: couch surfing for now but the situation can't/won't last.

A nice idea about giving him responsibility to make it more than a prop. However, having seen his previous homes, I can't imagine that the house would be maintained by him at all, even if an agreement was put in place. Sad but realistic :-(

[sbplanet]

"I can't imagine that the house would be maintained by him at all, even if an agreement was put in place. Sad but realistic :-( "

This is easy for me to say, but that is a self-fulfilling prophecy. I don't know how you'd get him to take some responsibility, but he needs to, I guess there's the problem. :(

[ALLIS0N]

Ok I’m going to be a real kill joy and ask lots of difficult questions. What will you do if

He / partner / flat mates annoy the neighbours / use the property to deal or commit other crimes ?

What if he trashes the house, has lots of parties, goes out and leaves it insecure so it’s broken into ?

What if he doesn't care for it? Leaves it filthy dirty, rubbish in the garden, attracts rats .

Doesn’t pay bills so utilities get cut off?

Are you prepared to evict him and any partner / kids?

Who is going to furnish it and pay all the bills?

Is your brother engaging with support services right now? Does he have an addictions worker ?

Most Homeless people will MH problems and addictions need a great deal of support to maintain a tenancy, and even with it many can’t cope. It’s honestly Not as easy as finding them a place to stay.

There’s a reason he’s sofa surfing now and not staying with you or other family members, isn’t there ?