To buy a house for DS to rent off me?

[PoshFaye]

DS is going to uni in September. He's staying in the same city but wants to move out. We've been looking at nearby student flats etc and they're coming upto £85 a week. I could buy a cheap little house for less than £200 a month!

Therefore I'm thinking why I don't I just buy a house, let him rent it off me for say, £50 a week - if he shares with someone at £50 each a week that's a monthly rent of £400 a month. Mortgage would be around £190 a month. Extra would be saved in a pot for improvements, damages and essentially - paying off the mortgage quicker.

Therefore he gets somewhere to live cheap. I get an investment property and DS isn't paying off some strangers mortgage.

Is it as simple as it sounds???

Remember houses were much cheaper in the 90s and BTL was only just starting to take off so just because it worked well then doesn't mean it will now as costs and rules are very different.

2 people sharing wouldn't be an HMO. 3 or more would be and you delve into a tricky world of licences etc

You will have to pay a fair chunk more of SDLT if you own a home.

Also you can't get a BTL mortgage to let to family generally...

Anyway I'm a seasoned property professional so feel free to pm me for any qs

My parents did this in two separate places for Dsis and me (1990s/2000s). Worked v well but I was just a tenant (didn't pay rent!) and not the landlady, which kept things simple.

Later on both houses were sold and it allowed DPs to help us with our house deposit as both houses had appreciated, so there was a profit even after capital gains tax.

Different market, though, and before buy to let mortgages? It can work, though.

catneuterer I take your point but the only failsafe way to show you have considered the risks is either to read up on the legislation yourself and write your own report and conditions in the lease, or to commission one commercially. My source is the legislation (I am a lawyer as well as a landlord so probably take these things too seriously). You can also have a problem if you even have a shower as it is the mist of water that poses the risk (apparently - even though nobody has ever caught legionnaires in a domestic setting yet); you have to check that hot water taps run at over 60C within a certain amount of time, and that taps are run for a certain number of minutes if the house has been empty for over 2 weeks; and to consider if there is anyone vulnerable in the property (like a student with diabetes, or asthma or immunocompromised in some way). IMO the legislation is daft but it is a criminal offence not to comply. There are a lot of barriers to being a landlord.

OP, in some ways it might be easier not to let the property at all but just to allow your son to live in it with no additional tenant. But then you are not exactly making a financial return! There is a lot to be said for student halls.

My parents did this for me. However I dropped out within a year!

I would put him in halls for the first year - that's where you get to make friends and have a soft transition into adult life (you're living on your own and need to cook for your self, but not pay bills etc)

Meanwhile, spend the time to do your research really well on the real costs of what you are proposing and start looking for the right property (bearing in mind that you will be coming up against professional BTL landlords who will also want to snap up the best places)

We did this. Put the mortgage on our home, and bought the property outright. Put our DS in rent free, with a pal paying rent, and it paid most of the mortgage.

DS is still living there (with a pal), and now paying us rent, as he's working. If we put the house up for sale now, we'd probably make slightly more than we paid for it, but we'll keep it for the moment.