Inherited house, what to do?

[meanderingmanchild]

I live in social housing with right to acquire, worth about £100K and could stay here.

Left house worth about £100K that I don't want to live in.

Nicer, downsized for age, homes priced £200K

Never had a mortgage, 45 years old.

What would you do with the house? Sell? Buy my place? Put down for mortgage on other place? Invest?

-never had such money before

Yes I think seeing this type of response is helping clarify things.

I think buying this place is a good option and yes, a discount would apply and rent for the past 7 years I've lived here would count.

I could downsize later when my child is older too, as she's only young.

And just use money from house sale for mortgage on here, but wonder if I can also keep some of that cash for living. I'm self-employed and working currently on increasing my earnings after split so seek to earn more over the coming years but on low income right now.

Sell the inherited house, put the money in an account with 5 per cent interest, stay where you are and think about it all for a while. The way the housing market is, there's no urgency and it might be a once in a lifetime decision.

It's for those who want to pay rent to a social landlord instead of private, it's more secure. We have lots in our area and the council have just build more too. Private landlords are very risky and owning a house is a very large responsibility and not everyone is up to it, I never have been in the past.

Saying social rents aren't subsidised is a bit of semantics though, really. They are typically far cheaper than private rental equivalents so while there is no 'subsidy' the housing association is letting them for less than the market value, ergo subsidising the renter by charging a lower rate than could ordinarily be commanded in the private sector.

You could fairly argue that private rent prices have gotten out of control and that housing association rents are roughly where rent should be.

I think you would be better off asking a financial advisor than asking on here.

If the house you live in is available to buy at the value you could sell the inherited house for, I think this is your best option.

£80 per week would not fund a mortgage of 100K over 20 years which you would want to do if you are hoping to live on your state pension.

You could the inherited house out but with unstable and low self employment income, you might struggle to get a mortgage on your income. You may be liable to tax on your rental income and the costs to bring it up to standard for renting in addition to the costs of managing a tenancy and ongoing repairs might not be the best use of these funds.

In response to OP, I suppose it depends on what you want to achieve. In the current set of circumstances that we find ourselves in this country, with housing association properties being very difficult to find, I really don't like the idea of someone with a £100k asset deciding that they either will continue to pay only £4160 pa in rent for a property a single mother with no assets or income needs, or buy it as huge discount.

But I hate the game, not the player. You need to do what is best for you inside of the rules. I would point out that your rent may well be less than the interest alone on a mortgage so if it were me, I'd sale the 2nd home and remain as a tenant.

OP needs to talk to her housing officer and as soon as possible. Its a condition of most social housing contracts. Renting a house and inheriting a house is not an unusual situation, but there are rules about savings limits and owning property.

The right thing to do in this instance would be to sell the inherited house and by yourself a bungalow on the open market - now you have the means. What about a home on a residential park - you could get something beautiful with the money.

If you want to look purely after your own needs which is completely within the law. It would be to sell the house, keep that money for yourself and keep paying 80pw rent. That is peanuts. I wouldn't even bother buying it. I'd happily pay that as an insurance policy for somebody else to be totally responsible for maintenance on my property.

Let us know what you decide

I'm not from the UK- are people earning rental income from investment properties honestly entitled to keep their social housing?

That seems insane to me.

Surely you buy a house and let somebody else, not as fortunate as you, have a secure home?

In your shoes I would sell the inherited house, use the money to do right to acquire on the house you live in.
then sell in the future when you need to downsize

Ignore those that say it’s immoral- unlike right to buy- social housing right to acquire means the HA uses those funds towards building new properties. It’s treated like shared ownership

No...I don't think you can own a property and live in a separate social housing property. I'm fairly certain it's not allowed so I'm baffled at to why the op said she was considering it.

I would get advice from a financial advisor OP. Don’t ask on here.
I would consider selling the inherited house and staying in your social housing. Or sell the inherited house and buy your house.
Mortgages are at silly interest rates and the housing market will change at some point. It might not be the wisest move to leave your current home and take on a potential financial burden, especially as you are the sole earner.

Personally I’d sell the inherited property and put the money in an account, continue renting and saving until I was able to buy but the money from the inherited houses will impact any benefits your getting.

Also if you get UC or other benefits that are effected by savings you will definitely better investing your money in your own home so you can still get the same monthly income. I think that will probably be the best option for you and society until you are in a position to earn enough to live on. If you have no mortage or rent then you could have a very good standard of living on a full time minimum wage.

I wouldn’t buy the house you are currently in as we have an housing crisis and if you could buy your own home it means a family stuck in a bnb will have a chance for a secure home.

So your housing options are:

1. Sell the inherited house and use that together with a mortgage to buy a more epensive house
2. Sell the inherited house and use the money to buy the HA property you are currently renting.

There is a third option - stay renting your HA house (you have a low rent and security of tenure) and use the money from selling the inherited house to set up a private pension or stocks and shares ISA so you have better retiremet provision than the state pension.

I say this as I think it sounds as if your income is too low to support option 1 - a £100k mortgage will cost much more a month than the rent you are paying and you wll also be responsible for all the repairs and maintenance.

Option 2 is more affordable as you will presumably not need a mortgage but again you will be responsible for the repairs and maintenance and I note as you have no private pension at all that will get more challenging when you retire. If you rent then the HA will carry on maintaining it and possibly any adaptions you may need later in life.

I don't know what part of the country you live in, but a quick search on for parkhomes on rightmove found this for 100k. It's a residential property. It's a good example of an option open you.

https://www.rightmove.co.uk/properties/134521595#/?channel=RES_BUY

First step should be to speak to your housing officer - you may not be eligible for a right to acquire discount if you have another property.

Equally, if you're receiving benefits, they will be affected.

I would invest the 100k and stick to renting for now no point rushing into anything.

This option quoted here.

Buying a social housing property and preventing some other person or family from accessing that support or housing when I no longer had a need for it (which you don't as you own another house) would not sit comfortably with my morals, even if the option was available to me.

I would sell the inherited house and talk to an advisor at your bank about how to invest the money to best provide for you and your child’s future.

It probably sounds like a huge amount to you now but it will have to last a while, your DC might want to go to university etc etc.

A mortgage on your current property would be far greater than £80pw, plus ongoing maintenance costs. If you don't plan to live in the inherited property sell it and invest the proceeds for a year then decide what to do. Would you not have to live in your ex social housing property for a period after purchase?

If when you retire you will only have state pension things will be tight and you won’t be able to afford much fun. I would be inclined to sell the inherited house, buy where you are now and start making some form of provision for more retirement funds.

Social housing depends on your circumstances at the time you need it. So when op got her tenancy she was in need of social housing. The right to buy scheme for most if not all tenants ended about 20 years ago so op's likely been in the property at least that long. Once you're in a tenancy you're not usually expected to leave if your circumstances change. They're peoples homes, not just a roof over their head.