Giving house to step-daughter?

[IsMadl]

Hi all, I have one step-daughter, no biological children (could never have any). My step-daughter is 27, she got married last summer, and is expecting her first baby. Her dad and I got together when she was 10 (her mum passed away when she was 7), we married when she was 16 and have been together happily since.

Before her dad and I married I had a 3 bed semi, we live in the North but it recently got valued at £300,000. We have been renting it out since I moved in here 12 years ago. The money has funded mostly my pension and odds and ends here. I'm a primary teacher though so have a good pension as it is.

SD and her husband have been saving really hard for a house, they earn well, she in the civil service and he in finance, but they work in London and obviously it is expensive. She had about £150,000 from her mum (-uni costs, wedding costs etc.) and they are saving.
Currently the house I had is to be split between my niece and nephew when I die, the house I live in now will go to step-daughter when both dad and I pass.

To me my step-daughter is my own, I was never able to have children of my own and I think she is incredible, so smart, beautiful, funny and caring. I hate seeing her struggle to build the deposit for a nice house, in a nice area with a garden which is all she really wants. I've been thinking maybe it is time I sell the house and give her the profit, obviously it would up there deposit massively. I wouldn't do it if I didn't think she and her DH had earned it but they are lovely, kind, hardworking people.

I told my husband and he said that it would be a lovely thing to do but no pressure as it is mine. My mum and dad think it would be a horrendous idea.

AIBU to consider this?

I’m glad that the thread has given you some clarity @IsMadl

I think that's a very kind thing to do. It won't just be fantastic for her to have the money but it will say so much to her that you want to do this.

Same here OP!
And it looks like you've got time, what they currently have is big enough. You can aim to sell your house, give them the money and the can move on by the time the child is 3-4 years old, at which point they'll have saved up more too.

There was no edit - I was in the middle of typing when the screen refreshed so I just carried on. It's really hard to type on mobile without the app.

Anyway the OP has updated so this is irrelevant - but as PP and I pointed out the original figures didn't make sense.

@perfumasour

Yes, I thought the houses they were sending were places they want to move to right now but I misunderstood it turns out!

Apparently they think if they were to buy now they wouldn't get anything better than they are renting (and landlord has given them freedom to decorate), they have a small garden so enough for a toddler.
I think there's debate as to SE/SW (well Greenwich Park vs Wimbledon Park).

Maybe in 2 years or so we can give them some extra and they will have saved more and they will be ready to buy (also potentially want to move for schools anyway).

I think we will speak to someone financially literate (maybe her husband!) to see about mitigating costs etc.

@perfumasour

You're right they didn't make sense that's on me for running with half the story (a very typical thing for me to do!)

Probably also notable that despite them both having masters degrees neither have any student loans. We paid all of SD uni fees out of savings and her partners parents (also an only child) paid off his in lieu of wedding/mortgage contribution.

I wouldn't speak to the husband as the financially literate person as he's the recipient. They have great income, and since you've mentioned your paying all childcare costs I'd be wary of doing too much.

Can I ask what you mean by too much?

I think we will speak to someone financially literate (maybe her husband!) to see about mitigating costs etc.

You can't get independent financial advice from someone who is involved! They have a conflict of interest, and ethically, they should refuse to advise. Find an experienced accredited professional who is unconnected to anyone in either family. Anyone who might benefit or lose out from the arrangements you make is compromised.

Sorry op, I think it's wonderful you want to help your daughter, and it's obvious you've considered your choices and this is the best place for your money to go. Being generous is great! I guess I have a (perhaps misplaced) instinct against someone being too spoiled, or you putting yourself second to make them more well off, but that's my own bias, and partly based on them looking for a four bed when they are just starting out.

But you love her and want to see her settled, which is legit.

Got a tear in my eye reading that. There are so many awful step-family stories on Mumsnet.

Say you sell it for £300k, I’d give her £250k it’s a round number and then save 50k for yourself.

Ethics aside personal finance is different from knowledge about the financial markets which is what he says. He's unlikely to be up to date on all the nitty gritty of regulation, tax structures, etc.

@Bigcat25

Don't worry I get it, and I really wouldn't if I thought she was spoiled.

I've said further on the reason they are going straight to 4 is as they are in a lovely rental (she's been there 5 years!) 3 beds, great relationship with the landlord. Apparently they don't see the point in giving that up for a 3 bed which won't be as a nice when they could continue living there until they can afford something bigger in the future.

I got my wires crossed thinking they want that now.

They really aren't spoiled. SD worked all through her A-Levels degree and masters, as did her husband. They are lovely people and happy in their 3 bed end of terrace haha!!
I think they just view it as next move will be to somewhere bigger ... hopefully before little one starts school so grandma can go down and babysit!!

my only comment is if op's gift to sd will be ringfenced in case of sd's divorce or is op gifting to bothe sd and sd's dh?

as a young couple, personally, i wouldn't want this gift if if might make my so called partnership questionable. considering her dh earns 50k-70k annually more than her, ring fencing anything for sd might just sour their relationship. so only give if you are happy for her dh to have a claim on it.

It actually makes a lot more sense with the OP's latest update. They have a stable rental and are not looking to move to similar, instead a 'step up' which is sensible.

Many people have to climb the ladder, either because they can't afford the next step without house price growth or because of bad rental experiences (the latter my case) but this doesn't apply to them.

Also in 2 years... They might have saved enough /gotten a salary jump and not need any, if much help from the OP anyway.

Sorry OP x-posted

Wimbledon Park all day. Greenwich is cut off from the rest of London in its own little SE bubble.

Ah, so the extra bed is partly so they can fit the grandparents, that makes sense.

Have you considered transferring your property into her name as a gift? So she gets the rental income and you don’t hand £££ tax to the government?

Honestly stunned that people expect to move straight into a million pound home straight away. What the hell happened to the days of buying a modest flat as your first home?

Why are they sending details of houses that are currently way out of their budget? Why are they not sending you details of properties they can actually afford to buy? I really hope they don’t see you as a cash cow.

They definitely don't, we sometimes send bungalows we might downsize to!! Like I've said I had it wrong they aren't looking to buy right now anyway.

Bit of a reverse there
They were " struggling" 5 minutes ago!

As someone also unable to have children of our own, I have no problem with leaving everything to my wife's nieces. Your sd has been in your life a long time. Who cares if they already earn good salaries. Giving them this money means that they will be able to give their child so much more...do it

Absolutely this. It would be a lovely thing to do.