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?

Surely there'd be quite a hefty CGT bill here too though?

I think it's lovely you want to help your SD and your parents don't actually get a say in it anyway. But you know their feelings now so can navigate them!

If you don't need the rent, you could use this to fund your SD and maybe guarantee a larger mortgage for them? The asset is protected from CGT and when the time comes, your beneficiaries can inherit (your parents don't need to know who they are....)

Or if you do sell, you could say you hadn't factored in CGT so you'll need to add to your pension....

In the meantime get tax advice as to whether you need to add your DH to the deeds etc.

You sound like a lovely step mum.

You sound lovely OP. How wonderful your SD brings so much joy into your lives. And now a GC too.

Good that this thread has clarified some ideas. I said earlier, better to give money now rather than in some long distant future. London house prices are insane too.

Good luck with whatever you decide

@IsMadl it's not about cruises and charity. It's about illness and cost of living. You have no idea what the next 20 years will bring and that extra money will be the difference between a miserable, stressful, painful retirement vs one where you can buy in help and comfort.

My FIL needed knee surgery. He was in AGONY. NHS said minimum 18 months wait. I cannot express how miserable he was. And the lack of exercise would have meant his health would have deteriorated massively in those 18 months.

So he paid 12k cash for private surgery and moved on with his life within weeks. He's now a happy healthy active pensioner.

Glad you have clarity now OP. Why don't you save the rental income for the next couple of years while they continue to save up.

That way you can see what it's like to not have it.

Yes definitely do what makes you happy, as long as you are covered for any future care you may need, as you don't know what they might be. Hard to look so far into the future.

Stamp duty - why on earth would anyone move more times than they actually need to anywhere in the country.

Stamp duty needs a rethink. Instead of paying it on the whole sum you should only pay on the extra value for example

House 2 £600k - House 1 £350k = Stamps Duty should be calculated on £250k Not the £600k

The current system penalises people who want to move a few times to climb the ladder

@Runsyd a million pound home really isn't that massive in London. In fact, you won't even get one in a decent area within 45 mins door to door commute from the City. And you're looking at 3 bedrooms max, maybe a tiny garden, and on street parking. Not exactly a mansion.

I have a "modest" flat. It's worth £500,000. It's a one bedroom flat in zone 3. And they don't go up in value like they used to. So when you factor in stamp duty and moving costs, you may as well wait another year or two, especially with how high the interest rates are right now.

You sound so generous it’s really delusional!

She doesn’t have children yet and these hypothetical children won’t be your “grand babies” I’m afraid.

It is mind boggling how much money is being thrown their way. They are exceptionally well earning for a couple in their 20s. They don’t need a 4 bedroom house with a big garden and trampoline, that is delusional.

Why on earth do you feel the need to pay their childcare as well?! And baby sit for them??

How about your niece and nephew - how much do they earn and are they doing to get a 7 figure property in London too!

With 300k in the bank they have enough deposit for a decent property. Not necessarily their dream property. Young people don’t need to be able to buy a house in London with cash - hardly anyone can.

You could give them the entirety of your main asset, but it won’t mean as much to them as to you. They will still need a mortgage.

I wouldn’t give them the whole lot. What about your own parents and siblings, do they live luxurious lives with plenty to spare? How does this look to them?

@Bananabreadandstrawberries

1. Not hypothetical grandchildren, she is pregnant and due next month so unless you're being cruelly pessimistic I'd say you can't read very well as I have mentioned she is pregnant
2. Yes they will be my grandbaby, stepdaughter and I have a fantastic relationship, she's asked us what we want to be known as and has said that they will know me as much as a grandparent as they will there dad
3. We are going to pay for childcare as we are incredibly Fortunate, our take home pay isn't that far off from there's but we have the benefit of owning a house with no mortgage. We are in a position to help her why wouldn't we
4. I will babysit because A. It's helpful B. I never got to have children of my own I'm looking forward to having a week or 2 with my grand-baby in the summer holidays doing all the things I never got to do
5. My niece and nephew already own, neither of them have London centric jobs and are older than my stepdaughter, also they have a mum and dad, I'm the closest thing to a mum my stepdaughter has and she has told me this
6. They may not "need" a garden and a big house but are you seriously telling me if you could afford to give your child/grandchildren that you wouldn't?

Sounds like you have it all figured out, OP. I'm wondering now what was the point of this thread?

@Bananabreadandstrawberries

1. My own parents and siblings lifestyle isn't relevant, they aren't my children. My stepdaughter is!

I was checking it wasn't an awful idea, most have said it isn't. The plans have changed slightly as I learnt more about their situation but I was processing my thoughts and getting opinions.

@Bananabreadandstrawberries OP has clarified throughout the thread that she's never been very financially savvy or good at forward planning. It's her own risk to take really. And the consequences hers to accept.

FWIW I'm also an only child and I can see my parents doing this - but I wouldn't accept it. They did offer me money for house, car wedding I only accepted a few thousand for the latter.

Even though they'd never expect anything back. I wouldn't be able to live with myself if they needed expensive care or medical treatment, but the money was all tied up in my property. In 20 years who knows whether the NHS will even exist. Although my parents don't have anywhere near the amount of assets that the OP has.

Of course if I was able to I'd pay/provide care myself but divorce, illness etc all these things are a possibility.

You are very kind - your parents - not so much.

I think you are doing an amazing thing that at the end of the day is yours no one else’s so what you do with it is entirely your call if as is your naughtier blood has nothing to do with it good luck

Aw how lovely. I would OP if this was my step daughter. How beautiful that after her losing her mum so young and you not having biological children when you wanted to, you've found each other. She sounds like a blessing and I think you're right to use your money to help her if this would make you happy too.

I like this idea. Sell and split the profit 3 ways so there isn't any hard feeling from your own family.
You could either give it all to them now or put your niece and nephews away till you know they need it.

Personally I’d sell the house and split the equity three ways

It's a lovely thing to do, but imo she's got plenty. Remember to enjoy your own life! You've hopefully got a long retirement ahead of you.

Obviously the thing to do to avoid all arguments between family members is to gift it to me.

I am also incredible, smart, beautiful, funny and caring. I promise I'll take good care of it.

OP, I think it is is a kind thing to do. I would do this for my child. I think I would probably split the money 3 ways between daughter, neice and nephew. I would also consider ensuring you have enough money for you old age.

How lovely and how sensible. Do it if thats what you want to do. Just go with your gut feeling. You may find when she knows she may come up with ideas of her own like sharing it with your niece and nephew, or other ways. You have obvioudly worked hard with this relationship to have such wonderful results.

I just came here to say that you're lovely and your SD is very fortunate that her dad married such a lovely person who treated her so well.

Good luck on the birth of your grandchild 😊

Sounds like your step daughter has been your daughter and you respect and love her. What amazing gift. Your choice but love it going to her. Yanbu and a kind lady.