to start charging my sister rent?

[cerealnamechangers]

My dsis has lived in my mortgage free house for seven years with her adult daughter since we moved to a bigger property, in that time i have never asked for a penny in rent as we were pretty comfortable but she has paid all the bills for the house e.g. council tax. I was intending to keep the house incase any of my dc ever wanted to move in. The market rate for rent would be about 650-700 pounds per calendar month.
However we now have 2 dc at university and money is tight so we could really do with the extra cash to help them out. Dsis is not short of money and her and her daughter drive nice cars and go on multiple long haul foreign holidays, so aibu to ask her for a contribution for living there? I feel awkward asking her as she has never offered.

OP, whatever you decide to do (and please charge her market rate rent), make sure it's all drawn up asa a proper tenancy agreement.
And take this opportunity to remind her that you'll be needing the house back in a few years to help your DCs onto the property ladder. I get you anything that she's 'forgotten' that!

Surely both you and your husband must know this isn't right? Seriously? You've given away thousands and thousands in income that could have been spent on your children and you still are considering giving it to her half price, I just can't believe it. I know she's your sister but this isn't right. Don't settle for a nominal amount either. I'd even sell the house to get out of this mess.
Would your husband have the conversation with her if she won't?

Interesting situation and of course you must now ask for your sister to pay rent and a reduced rate acknowledges that she is family. I would suggest offering her a percentage discount on the market rent (maybe 25/30%) so that if in a few years time you could review if necessary and move her rent up to be same discount but a higher amount. It sounds like the sister may be there long time and while it probably suits you as well as her (although not as much) I would seek legal advice just to sure of your position if you ever needed to sell and (thinking very long my term here) if her adult daughter remained in the house when your sister passed away how that could affect you or your children. Best to be a little savvy on the QT and make sure that you are covered legally.

I think if you explain that you are struggling to fund 2 children at university she should understand, I agree with others that to ask for the going rate may be a bit of a shock but if you say £300 -£400 would help you enormously. However you need to be prepared for a negative response and decide how you will deal with that.

You definitely are going to have to 'man up' and sort things out OP

I'm feeling much less charitable than in my previous post now I know she was always meant to pay a token £100 a month and never has. You know you should have chased that up because it's only lead to higher expectations from your sister.

How do you get on generally and how do you think it's going to pan out because it's one thing you saying that she's always known she'd have to move on, but unless she now has seven years' worth of market rent savings to carry her forward, you do know it's not going to be about what a marvellous thing you've done for her, it's going to be about how could you put her in the position of becoming homeless

Woah...OK, if she was supposed to pay £100pm from the start but hasn't, that changes everything. She is clearly taking advantage of your generosity OP. Explain that your financial circumstances have changed and you need the extra money from rental income. Offer her a slight discount off the market value and if she is unwilling to accept, give her notice to move out and find yourself a paying tenant. Good luck!

This will come across as a very selfish post but it's the way I see it.

I am a LL on a inheritance property. When I took the property on I had a few friends who made noises about living there a rent reduction price you know as they were "such good friends" we went straight to the EA as I was not going to mix friendship with business.

We could of sold the house 2 years ago as we up sized our home and it could of meant we could of lived mortgage free with a nice £100k in our back pocket but in the long term we are getting our mortgage paid on our home and bringing in a extra £500 plus in the long term the house will increase in value so we would of been crazy to sell as once the money is gone it's gone.

OP no way should you be paying off your own mortgage as if you would of sold I'm assuming you would be living in your own property mortgage free.

The fact you pay LL insurance means your intact paying out more than your getting off this property.

You have been very generous but the fact your sister has not even contributed the £100 agreed is a piss take.

I would mention in passing to your sister that you cannot afford the financial burden on the second property and are giving her warning that you will be looking at your options on what's to do. Then instruct a few EA to give you valuations on rent and selling prices and go from there.

I don't think she should be living there rent free, I feel it's a absolute piss take.

I cant help thinking that it would be better to sell the house, use some of the equity to support the kids in Uni and invest the rest for some point in the future if they need house deposits etc.

Solves the sister and the income problems in one stroke.

She's your sister so I can understand to some extent your reluctance to deal with this but how has your DH not flipped?! He must be a saint! They are driving swish cars and taking continental holidays while you can't get your own car fixed... That is insane!
Why - in seven whole years - did you not raise the £100 she and your niece were supposed to be giving, at the very least?
I'd tell them, due to your generosity, they have stayed rent-free for SEVEN years! Your circumstances have changed for the worse, and theirs for the better, apparently. Tell them they will need to pay two-thirds the rental value (all done legally) with you and DH as landlords and them as tenants (state a date!). If they object, tell them they can find alternative accommodation (state a date) so you can rent out at full market value. You are still doing them a favour.
Yes, get legal advice first in case they have gained any rights through living there these past seven years.
You are going to be the bad guy in any circumstances other than letting the situation continue as it is, I think you know that. I would let DH tackle it or put on a united front with him (don't do it by yourself as they may try to guilt/ argue you into keeping things as they are...

Half market value is so little. I would ask for a bit under market value. Maybe £100 or £50 less. You have given her tens of thousands that you could have given to your children. It sounds like sister and the neice could easily afford more than a paltry 50% of market rent.

You car is broken and yet they have two fancy cars. It's bonkers!

Yes, but it is so galling that the OP might sell the property in order to get rid of the sister problem when she could use the property itself as an investment.

Selling might indeed e the best option, but I feel so cross the OP is in this situation because of her own generosity.

This is a bizarre set up. If you were completely financially sound yourself then I could almost understand your generosity, but you are still paying a mortgage on your own home!

Say market rent is £600 a month for the time she has been there - you have saved her more than £50,000.

You have LOST OUT on £50,000 income if privately renting.

There's the money for putting your DC through uni!

Just tell her straight that you need the extra income and the situation has to change. She can either start paying market rent or move out, simple.

You have been more generous than 99% of people would ever be. Your sister should be gracious and thankful, not difficult in any way.

I think I would say, you're circumstances have changed and you are going to need to charge rent from next month and advise her its half the market rate. Then from January 1 she can have the property at 1 Jan per month.

Or selling the house may be the easiest thing long term to free up some cash etc as its no longer working for you. Then if and when you do decide to purchase again buying something new or off plan would work and keep maintenance to a minimum.

I'm guessing you have no formal contract with her - it might be difficult if she refuses to pay AND refuses to leave.

Your sister has been taking the piss out of you and you know it.

As Toffee said, she has saved £50,000. Tell her to fuck off and buy her own house as by now she surely must of saved up one hell of a deposit!

As others have said, you need to calmly explain you are struggling financially and need the income from the house, simple as that. She has had an easy ride for a long time do should be grateful. No way should she be swanning around in nice cars and on exotic holidays when you are struggling. That isn't right or fair!

Her choice should be move out or pay a fair rent. You could chip a bit off the current market rent as having a tenant you know and trust is worth something. By this I mean £50 or £100 per month off the current market rent. If she doesn't like it, she can wake up, move out and rent on the open market and see how she likes paying the full whack!

What Toffee said

OP I have 1 DC at Uni and another starting next year. To put the finances into context:

DC1 has full LOANS for fees and accommodation, £14K/year, £45K total
We transfer a further £100/week to live on, so £5K/year, £15K total

DC2 will do exactly the same

You cannot afford to give this money to your sister for free while your DCs will borrow for uni and you are paying for them, plus a mortgage while your sister lives rent and mortgage free.

Surely by now you realise this is madness. No amount of awkwardness would prevent me from asking her for proper rent TODAY

Agree this is silly. Start making it clear you need to charge rent from the house and if it's too expensive for her she maybe looks elsewhere.
You're behaving like her indulgent mother not her sister.

As above, her DS choices should be, move out and pay market rent, or stay and pay slightly below market rent. Bearing in mind she is £50k up on the deal already

She's had long enough and now needs to pay you rent.

THE RENT/BILLS MISUNDERSTANDING HAS BEEN SORTED. PLEASE STOP SAYING BILLS ARE NOT RENT. WE KNOW.

It's like fucking mail the cheque in here.

*cancel the cheque

Honestly your family which is your DC and your DH need to come first I'd tell her the house is going on the market OP!

It's your house,you bought it and you've paid of the mortgage,you've been more than generous it's time for your Sister to start living in the real world!

"Hi Sis,

Things have got a bit tight financially for us recently and we need to start renting out the house to paying tenants to get some additional income from it.

I thought I'd give you the option first whether you want to rent the house out rather than have to move. I honestly don't mind which you do.

The estate agent says we could rent the house for £700 a month, we need to get at least £500 a month from it to get us out of the situation we're in at the moment so if you want to rent it for £500 you can, but if you'd rather move somewhere else you like better then that's of course fine and we'll rent it out via the agent.

Lots of love,

Me"

Something like that?

Sorry if this is a drip feed but she was supposed to pay me 100 oound per month as a nominal amount when she moved in and never did so we just let it go as we didn't necessarily need the money at the time and assumed that when she got back on her feet she would pay.

This is ridiculous. She needs to be paying you at LEAST half the market rent. It's crazy that you and your kids are going without when she's sat in YOUR house that could be earning you so much a month or which you could sell for a huge cash boost that you could invest.