Buying MILs holiday home.

[strengthinnumber]

My MIL has owned a holiday home for over 30 years. She was an accidental landlord under strange circumstances and apparently nearly sold it a couple of times in the early years, but ended up keeping it and renting it out either as a family home or latterly as a holiday let.

Because of where it is it's now worth a lot of money (3 beds, parking, garden,10 mins walking distance to lovely seaside town and beach.) We've always holidayed there with her at least once a year as have my DH's siblings.

Some background. DH doesn't really like the place due to bad memories. His siblings either pretend the bad memories aren't a thing (SIL) or actively revel in being in the place and happy as a kind of giant fuck you to the person who MIL inherited from (BIL). Anyway there was a bit of drama with the house over the summer which apparently made MIL think, and she's decided to sell the house. But she wants DH and his siblings to buy it.

She's offering it to us for less than the market price (but an amount that won't be queried for IHT purposes. SIL works in this field and it's legal and watertight). This is still a comfortable 6 figure sum from each of us though.

I think it's a no brainer. Rental income is stellar and we would be getting a great asset at a fantastic price. The kids love it and we've had fabulous holidays there.

BIL and SIL are on board as well. However DH is flatly refusing. His reasons: he still feels uncomfortable in the house. He'd have to be in business with his brother and sister who (in fairness) are a bit much. He worries his mum will miss the income. We'd have to use most of our savings to buy it.

Basically I think he's digging his heels in because he doesn't want to own it because he doesn't like it. And I get it. But hey- if necessary we never have to go there again. It's still daft to turn down the opportunity to purchase it. It would provide a better pension for us in later life and help fund the kids through university. I'm very frustrated as he's letting his feelings about the place make him miss out on a very sensible financial opportunity.

Now MIL has approached me directly and asked if I'd like to buy DHs share (she wants her grandchildren to benefit). I have some personal investments I could sell plus technically half the savings are mine (we've contributed equally over the years).

Would IBTA if I did this. Mil seems to think DH won't mind and that in fact he'd be happy eventually to gave the decision taken out of his hands.

@Theyellowflamingo

”Discount is worth over £100k each before we take into account rental income. Would people really walk away from that much money? Even if we sell the house a few years later if the management gets too much we'd make money.”

You could offer me, for free, a £1m share in a £3m house and if it involved the other £2m of the house being owned by my siblings I’d turn it down. There is literally no amount of money I’d accept to put myself through that stress and potential further damage to already fractious family relationships. We get on ok at a superficial level, if we had to agree on important financial stuff we’d end up falling out irreparably.

Absolutely the right choice for you. But DH and his siblings love each other. In fact I've complained they're too enmeshed. They are clever capable people with the same values and approach to life.
BIL is a bit dramatic. SIL is a bit controlling and hyper organised.
but that's it. They're lovely. Their children are lovely. It's really all pretty functional and nice.

(Their ridiculous relationship with their mum is at least 3 threads worth that I don't have the energy for. But she wouldn't be involved).

When you’re doing the maths on the rental income, don’t forget to factor in 20% agent, x % house manager, cleaners, odd job man, gardener + wear and tear.

@TatianaBis

When you’re doing the maths on the rental income, don’t forget to factor in 20% agent, x % house manager, cleaners, odd job man, gardener + wear and tear.

Excellent point. We will err on the high side.

No way in hell, it’s a recipe for disaster.
It’s not going to be much of a pension or put your kids through Uni either. You’ll get what - £500-700 a week in high season if it’s split 3 ways, from that you’ll have to pay the upkeep then if you are ever able to sell, you’ll be liable for CGT.

STAY AWAY.
Imagine the hassle and the resentment at home.
How on earth will you sort out when to let, when to use, who uses in high season and so on without a detailed agreement with in laws? If that seems a big ask due to communication issues do t do it. Don’t especially do it if your DH isn’t on board.
If the tables were turned, would you be happy for him to go in with your family?

Partnerships rarely work out. You will be the minority partner even with a 50% share be sure you will be up against your BIL/SIL. This has disaster written all over it.

I’d tell him I was doing it and I’d be dealing with anything to do with it. If you thing it’s good for your kids and your future.

I love my siblings OP. We’re all fairly similar. We all have holiday homes as we are very lucky. However, our approach to our holiday home rentals is completely different. Highly unlikely we could own holiday homes together and not argue. People have very different approaches to running a business.

BIL is a bit dramatic.
SIL is a bit controlling and hyper organised.
(Their ridiculous relationship with their mum is at least 3 threads worth that I don't have the energy for. But she wouldn't be involved).

@strengthinnumber There is not a hope in hell that your MIL - who is so determined to keep that house in the family that she ignored her own son's wishes - won't be involved if she has a "ridiculous" relationship with the siblings.

It's always going to be her house. Her discount. Her generosity that allowed you to buy it. Etc etc etc.

Add in the fact your husband is concerned she'll miss the income and this has disaster written over it more and more everytime you post.

@Theoscargoesto

STAY AWAY. Imagine the hassle and the resentment at home. How on earth will you sort out when to let, when to use, who uses in high season and so on without a detailed agreement with in laws? If that seems a big ask due to communication issues do t do it. Don’t especially do it if your DH isn’t on board. If the tables were turned, would you be happy for him to go in with your family?

Good point. Sadly my family are not at all interested in me or DH or the kids. According to some therapy I had after I got depression when I had my youngest, his warm lovely family might be one if the reasons I fell so hard for DH. Not sure that true- he was handsome and funny and good at sex which I think had more bearing on the issue, but until recently I've always really appreciated how welcoming his family are.

Oh god. Maybe this is me. Clinging to his family. I'm now eating a disappointing burrito and questioning life choices.

But she wouldn't be involved

If she is as unreasonable as you hint she will very much be involved. She won't cease to remind her D.C. of how generous she has been and will want some sort of quid pro quo.

Your husband knows his family much better than you do. He is more aware of the dynamics and nuances involved. He wants to steer well clear of this apparently good deal. Why do you persist in thinking you know better? Has the money blinded you?

How are you funding it?
Cash? Remortgage family home? BTL?

Is it being bought through a ltd company?

@M0rT

I'd divorce my husband if he went behind my back and did something like this with my family.

This

@YoungGiftedPlump

How are you funding it? Cash? Remortgage family home? BTL?

Is it being bought through a ltd company?

Savings. I acknowledge we are very fortunate. There are very few reasonably safe places to put cash these days hence the attraction of this.

I just think this an awful thing to do to your husband.

I'd be distraught if my DH did this and I felt like your husband. Doesn't matter about the money or any of it.

What happens when you want to sell?
You must realise that the other two parties will want a discount to buy you out.
Put the money into your pensions and Stock/share Isas for the kids instead.

@Mylee

You have clearly already made up your mind

This.

You're looking at the money only. You're not looking at the important side, going into business with two people you know are difficult. That's just a daft idea.

But your money. Just don't dare complain to your husband if you get annoyed by the bil and sil, or come back here complaining. You know it could go wrong, you've made your bed if you go through with it, smile and deal with it.

A perspective a generation later.

My grandparents sold the family summer house to my aunt (my mum's sister) at a vastly lower market rate. My mum and her other sister weren't given the option of buying in.

We grew up visiting the house as children and now we're adults ourselves it's become incredibly hard that we have no claim over somewhere that plays such a massive part in our childhood. My mum is devastated she didn't fight to buy it collectively. Me and my siblings always thought we'd bring our children here every summer in the way we grew up (it's in a different country to where we live). It holds such an incredibly special place in my heart.

If I were you I'd absolutely fight to buy in. But appreciate our situation is different from yours.

I find it astounding that you are even considering this proposition. If I were in your husband's position I would be horrified and deeply hurt by your lack of loyalty and inability to see his point of view.

As someone who has entered into a financial transaction with family, I can assure you it's a recipe for disaster, as well.

So if you want to destroy your marriage and potentially fuck up your finances, I would say go for your life! Alternatively, you could respect your husband's opinion and keep your marriage intact.

Some things are more important than money.

@Luckylast

I find it astounding that you are even considering this proposition. If I were in your husband's position I would be horrified and deeply hurt by your lack of loyalty and inability to see his point of view.

As someone who has entered into a financial transaction with family, I can assure you it's a recipe for disaster, as well.

So if you want to destroy your marriage and potentially fuck up your finances, I would say go for your life! Alternatively, you could respect your husband's opinion and keep your marriage intact.

Some things are more important than money.

I was just about to type almost exactly the same thing, especially the last sentence. Loyalty to your DH should come higher in your list of priorities than ££££. Also the arrangement sounds very tying. I can see a lot going wrong.

Oh god. Maybe this is me. Clinging to his family. I'm now eating a disappointing burrito and questioning life choices.

😂

Good insight.

I get what this cottage represents. But the reality of second homes is hassle in a place a long way away. Of course it has its pluses or no-one would do it. But the cost/benefit ratio is a lot tighter than it looks.

@Horriblewoman

A perspective a generation later.

My grandparents sold the family summer house to my aunt (my mum's sister) at a vastly lower market rate. My mum and her other sister weren't given the option of buying in.

We grew up visiting the house as children and now we're adults ourselves it's become incredibly hard that we have no claim over somewhere that plays such a massive part in our childhood. My mum is devastated she didn't fight to buy it collectively. Me and my siblings always thought we'd bring our children here every summer in the way we grew up (it's in a different country to where we live). It holds such an incredibly special place in my heart.

If I were you I'd absolutely fight to buy in. But appreciate our situation is different from yours.

Interesting. I love it there. The kids adore it. The other siblings would want to buy it without DH which is I think what worries MIL as she's always been scrupulously fair with her children and this isn't.

If she then decides not to do it because of DH opting out then his siblings will be disappointed. If she sells it to a third party we've lost a big part of our family life. For her 70th birthday we put together a photo collage of all the grandchildren at the house growing up every year. Some great memories. Even DH sees and appreciates this.

He’s said no, listen to him. If he’s nice enough he may grudgingly agree to it even if he doesn’t want to but it could all go wrong. My concern is that his reasons are all sensible, particularly when it comes to being in business with the siblings.

I won’t go into details but my relatives were in a similar situation and it turned into a bit of a horror story- one didn’t want to buy and the other was so convinced it was a great financial decision that they steamrollered the other into it basically. It has left them on the brink of divorce!

I think your husbands feelings should come first in this , regardless is it’s financially sensible or not. He has his reasons and he’s told them to you, as I’m his wife you should respect that and not go behind his back.

But she wouldn't be involved

Can you be sure your MiL will be completely out the picture once she sells given you seem to suggest she is enmeshed with your DH's siblings?

You seem switched on from a numbers/business point of view. If you have the money to join this investment there must surely be others out there that don't run the risks of emotional fall outs like this one does?