AIBU to charge my DD rent to live in a flat I have bought?

[Canadianskates]

I am in the (fortunate / unfortunate?) position to have inherited some money after both of my parents died a few years ago. I am using it to purchase a small flat so my DD can live there when she is at university and since the cost of halls / private student lets is shocking. She would have a flatmate who would pay the market rate for rent but I’m struggling to think of if / what to charge DD.

She got a student loan in her first year and pays her halls from this. She also received some of the inheritance which will help with daily living costs across her whole degree so she won’t need a student loan each year.

Part of me wants to help her re hugely reduced or no rent but I also don’t think she should just have a lovely flat for totally nothing either. I don’t want her thinking she doesn’t need to work to get things or that money / flats just fall into her lap. It wouldn’t feel right to charge her the market rate either though.

I’m struggling what to do. AIBU to charge her rent & bills? She is 19 and plans to get a part time
student job too.

I think is fine for her to pay for bills but not rent.

This but also tread carefully, well the flatmate know that you're the landlord? It could cause some issues for your DD.

Yes. Paying rent and bills is a big part of being a functional adult and at 19, definitely time for her to start doing that. You'll be incurring costs that need to be covered and you need to have a fund for maintenance and repairs.

Surely it would be better not to charge her rent so she doesn't need a loan. I wouldn't charge her rent if she is a student. You will get rent from the tenant. You could charge dd rent when she's working.

I would but small amount. Whilst it isn't a mortgaged property there are still costs associated with having a property.
I would sit down with her and discuss her budget and work out what is affordable.
I would set it aside and use it for any ongoing costs and anything not spent gets gifted back at the end of the course. It would do two things, highlight the cost to her for maintaining the flat and ensuring that it is kept in good condition and make her feel like she's not had it handed to her.

I moved in with my parents when I left uni and paid them £250 a month for 4 days a week. My job was near them and there was a gap before my partner could relocate so I was at theirs during the week and in my uni city at the weekends. It helped to feel less like a child reliant on my parents.

This!

YABU. If you don't need the income then why would you charge her rent?

She could spend the time on her minimum wage part-time job studying or getting internship / work experience that will actually help her with her career.

She could also reduce her loan and therefore her debt.

Surely she would just pay all the bills?
Including house insurance etc

I couldnt charge her rent...
Will the house mate be known to her?

That's a good idea if their working but if they're effectively getting into debt to pay for rent for you to put into a savings ayfor them you're robbing Peter to pay Paul. It doesn't make any sense.

Amazed at the posters saying charge her rent when it's been so well publicised about interest on student loans. Why would you charge her rent AND save it for her. The interest on any account you had for savings is going to be less than any interest on her loan.

And as for bills, you don't pay Council tax as a student providing her flatmate also a student but her and the flatmate should pay electricity / gas etc.

I wouldn't charge her rent in that situation, although she should pay her part of the bills. I'd expect her to benefit from taking a lower loan. Surely you want to help her get off to the best start?

It would be utterly mad to charge her rent if it meant that she borrows more from student loans. I would also cover a portion of her bills if I could afford it, but not all as she needs some incentive to keep them low.

I was in a dilemma as I don’t want her to take her situation for granted. I completely understand peoples points of view of not charging her which is how I was leaning.

To the person who said this money just fell in my lap, it feels different to me as I worked and paid my own way my whole life until I received the inheritance. I also looked after my parents for many years when they were very ill and only have the money as a consequence of them dying obviously.

Re longer term plans with the flat, my other kids hope to go to uni or work in the same city (it’s nearby) so the plan is that they would then live in it when DD moves out and then it would be a general rental for other students or young professionals after that. So our kids would be using it for the next 10 years at least I think. The cost of their accommodation over those 10 years would be more than half the property value so I think it makes sense to invest in a property.

I obviously want to help DD out but also want her to understand money, budgeting etc. Just not take it for granted as I said!

Assuming she needs a loan for living expenses too, you could charge her rent and then use that money to pay off part of her loan at the end of the year so she ends up with reduced debt. That way she is not taking on a big loan and then having lots of spare cash to fritter away whilst living rent free.

Personally, I don’t think I’d charge my daughter rent. I’d see it more as my responsibility to make sure she has somewhere safe, warm, and affordable to live if she needed it. If I were in a position to help, I don’t think I’d feel comfortable profiting from that — at the very least, I’d probably be putting aside anything she gave me for her.

Even if it’s “cheap” rent, over time that can still add up to quite a lot, especially for a student relying on loans, with interest building over the years.

I suppose for me it just feels a bit unfair to charge her, so I can understand why she might feel that way too.

I’d also be a bit concerned about how it could affect your relationship. What happens if she can’t afford to pay, or decides not to because she feels it’s unfair? Would you want to be in a position where you’d have to enforce it or even consider asking her to leave? Things like that will have a long term impact on your relationship.

There’s also the dynamic with the other student renting — if one person is paying and your daughter isn’t (or is paying less), I can imagine that might create some awkwardness or even resentment. I do realise that slightly contradicts what I said earlier, though!

Also, has she actually started uni yet? It’s hard to know whether she’ll enjoy it, want to stay, or even decide to change location. I’d be a bit cautious about buying a flat purely for her to live in unless you’re fully prepared to take on being a landlord and see it as a longer-term plan.

Decent parents support their children through university, not profitier.

Can she reduce her loan by how much rent would be? That way she will have less debt? Will you be able to offer similar terms to any other DC?

How can you even think of charging your own student daughter rent?

If she was earning a salary, then yes possibly, depending on various factors, but students don't really have an income do they? It's all borrowed on a student loan which will hang over them for decades.

You own this flat outright I think?

You worked and paid your way your whole life because you're older than her! She's 19 she hasn't had the chance yet! It's not any different

In your situation I would not only let her live there rent free, I would encourage her to take a lower loan amount so as to reduce her overall debt after university. What is the point of having money, if not to help our children? Why are you seeking to profit from your own child, when you don’t need the money?

I simply don’t agree with the idea that young people won’t learn to budget if not forced to so. My parents helped support my brother and me while studying and then let us live rent free with them after uni so we could save for deposits. We are both responsible with money and own our homes outright in our 40s. We are very grateful to our parents and regularly try to treat them because we know what they sacrificed to help us. We also (unknown to our parents) save money to help them with care if needed when they are older. Because that is what families should do.

Whilst some are getting on there high horse about OP suggesting rent and she’s profiting from her daughter
at a guess in a university town a flat will be at least 120k
if op invested that she could get a return of approximately 5k there’ll be service charges And ground rent 1k any maintenance
as she’s renting there’ll be safety checks fees

so all in all to let her stay rent free will cost OP just short of £7,000 a year

@rwalker yes she'll forgo a bit of profit and?

To help your kids at uni is normal, and you do it if you possibly can.

She has the other student in the flat to profit from, and all the future students who will live there after her own DCs have completed university. Hope she intends to he a good landlord.

It’s part of being the parent of a non-earning university student. There’s nothing high-horsey about that. One way or another OP will have to financially support her kids, doing it through rent free accommodation is one option.

This is great advice

Exactly what I came on here to say.

if she wants to live in the flat when she is working full
time, that would be a different matter.