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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

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Original poster

Housing benefit rent from parent?

102 replies

IDoDaChaCha · 09/06/2017 08:15

In short, my mum is buying an investment property and has offered to rent it to me. I'm in social housing on housing benefit with horrible neighbours so I'm keen to move on.

She rang the council who said she has to have rented to the open market before she can rent to family and the rent be covered by housing benefit.

Does anyone know how long she'd need to rent on the open market before I could get housing benefit renting from her? x

OP posts:

sleepingdragon · 09/06/2017 08:27

It will depend on the local authority. Where I have worked there wasnt a requirement about a lenght of time, but the council had to see evidence that the property was let commercially- i.e. a legally enforcably tenancy agreement and market rents.

Particularly as you are on housing benefit already it might be worth you phoning the council to ask them exactly what they will require. If you can get this is writing that would be very helpful for you incase they change their minds on what they require.

Buck3t · 09/06/2017 08:29

Also she needs to check with her mortgage providers. They don't normally allow renting to direct family members as a condition of offering the mortgage.

LIZS · 09/06/2017 08:31

Council will have its own rules, so you need to check with them.

hibbledobble · 09/06/2017 08:33

Usually councils will not allow renting from family members, as there is a huge potential for abuse.

expatinscotland · 09/06/2017 08:38

You need to check with your council, many prohibit this for obvious reasons.

Jellybean85 · 09/06/2017 08:39

I rented to my brother on housing benefit, I had to show it was market rate and that we had a proper formal contract. Our la had no requirement for it to have been rented first we just showed loads of evidence it wasn't above market rate

expatinscotland · 09/06/2017 08:40

She's buying an investment property but she's unwilling to help her own daughter get out of a shit housing situation? She wants the state to fund that for her own kid? This is why councils often forbid renting to family members .

Izzy24 · 09/06/2017 08:43

Jellybean is right.

AyeAmarok · 09/06/2017 08:45

What are your longer term plans OP? And what are your mum's longer term plans for the house?

If you're giving up a secure tenancy to rent from her, make sure you have thought through each eventuality.

woollychimp · 09/06/2017 08:51

It's worth going to citizens advice to check whether the council's stipulation that she must rent it on the open market is legal.

As Jellybean says it would have to be not above market rate.

Catminion · 09/06/2017 08:54

Are you going to be on Housing Benefit forever OP? What are you going to do if your circumstances improve?

Personally I find it unethical for the state to fund your Mum's investment by HB.

rightwhine · 09/06/2017 08:55

So she wants the state to pay for her investment property instead of helping her daughter directly?

londonrach · 09/06/2017 08:55

Im shocked this is legal but if jellybean has done it it must be. Talk to council op but im surprised your dm is buying a property to rent out to get benefit rent rather than help her daughter if she can afford to buy.

londonrach · 09/06/2017 08:56

Ok i badly worded that but you know what i mean.

WomblingThree · 09/06/2017 08:58

Ok, I'm not suggesting committing fraud, but how would they know you were related? This is a genuine question, as when I was on housing benefit many years ago, I don't remember any questions about my relationship to my landlord. Also, around the same time, an acquaintance on HB rented her mother's house.

I absolutely agree with the reasons against it by the way, as there is way too much room for abuse, I was just interested if it had changed in the last few years.

OP, you would be insane to give up social housing. Why not just put in for a swap if you don't like where you are. What will happen when your mother decides to cash in her "investment" (which she will, whatever she says now) or when you have a massive falling out, or when you don't keep it clean to her standards. All of these things happened to my aforementioned acquaintance. It's a minefield. My friend ended up homeless and had to live in a B&B for god knows how long. Social housing is a secure tenancy, and I can't imagine why anyone would give that up.

MuncheysMummy · 09/06/2017 09:02

Sadly I'm not shocked in the slightest! This is a symptom of exactly one of the biggest issues crippling our economy...more people taking than paying in means we are running out of money! Everyone looking for a Way to get the most they can out of the benefits system,it won't end until there's not a penny left

Tollygunge · 09/06/2017 09:02

I agree actually. If she's got the cash to BUT an investment property (and let's not forget most btl mortgages require at least 40% deposit) why can't she help you? Which she obviously wants to do as she's offering it to you to rent

TinselTwins · 09/06/2017 09:02

renting from family/friends is LESS secure than renting from a stranger - much more potential to go wrong, so don't do it for that reason even if your mum doesn't care about the ethics of it all!

Puzzledandpissedoff · 09/06/2017 09:04

For those saying "why should the state pay her relative?", maybe it's worth remembering that the state is paying for the housing anyway ... what real difference does it make whether the money goes to a housing association or a family member?

At least this way there'd be a saving to the public purse in terms of admin, maintaining the property and more

Stickmangate · 09/06/2017 09:05

Housing benefit is a national scheme LAs cannot have their own rules. Check out regs 8 & 9 of the hb regulations. Renting from a close relative is not prohibited but it does have to be on a commercial basis.

As you are in a ha property now your rent will be low a private rent will be higher and unlikely to be completely covered by hb.
You will need to prove that the rent charged to you is what she would charge if she rent on the open market you would pay any top up and if rent not paid would take steps to evict etc.

If you can prove it is commercial then you can rent from her

Tollygunge · 09/06/2017 09:08

I think what people are saying is that the state shouldn't be paying anyone in this case as mum clearly has the cash to look after her own child. HB like all other benefits should be a safety net. Rather than making money from money the mother should be looking after her daughter so the state doesn't have to.

80sMum · 09/06/2017 09:09

Personally I find it unethical for the state to fund your Mum's investment by HB.

^This!

PookieDo · 09/06/2017 09:12

I'm a renter and claim a tiny amount of HB and this doesn't sit right with me either but I'm quite sure many people do it.

isupposeitsverynice · 09/06/2017 09:12

This can be done. My ex's mum owned two properties that she rented to my ex and his sister, and both had periods of claiming housing benefit while renting from their mum. I believe they had to provide a lot more paperwork than usual to demonstrate there was no funny business going on.

I don't think it's any more unethical for op's housing benefit to go to her mum than any other private landlord

GreatFuckability · 09/06/2017 09:13

i rent my house from a family member and receive housing benefit. it wasn't a case of them buying the house to rent it to me, but that they were moving out to get married and i needed somewhere to live so it made sense. its all perfectly above board.

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