Implications of buying a house with parents

[Sweetasstevia]

My parents and I are currently exploring options for moving my elderly parents closer to us so we can keep an eye on them :) and they get to see us and the grandkids more. Their house is currently on the market for £375k. They also have savings of around £150k which they don't want to touch at the moment.
What would be the implications if we went in with them to purchase a £650k property With them using the process of their sale as a deposit?
Would they need to pay rent to us to live there in the eyes of the tax man / inheritance law?
Could the council force a parent to sell the property to meet care fees should one outlive the other and need residential care (once savings are depleted)?
Nb We don't currently own a property (we live at my FIL's) and going in with my parents seems in theory an affordable way to get on the property ladder.

Sorry that should be my husband and I !

You will need advice from a good conveyancing solicitor. Not least you will need to get the type of ownership right so that you and your home is protected not just to meet care costs but so any eventual estate can be settled. Plus, obviously, your parent's interests need safeguarding in the event of anything nasty happening to you: divorce, bankruptcy, death or disablement.

The legal forum on Talking Point, the Alzheimers website might have some ideas. Other than that I would ask around for recommendations for a good approachable lawyer, perhaps in a local firm with colleagues who specialise in estates, wills and probate. We used someone in an established local firm when buying my mothers sheltered housing, and gained valuable advice on specialist leases etc. Take any recommendations from estate agents or mortgage firms with a pinch of salt. Instead ask friends who have recently purchased property.

Thank you so, so much!

We looked at this ( living together) some time ago. We are the GPs. All the legal stuff can be sorted, but it's the 'small stuff' that's more important.
You don't say how old the GC are or how old the GPs.
Will you share ALL household bills. An example: I don't do cold at all, if it's July and chilly, the heating goes on. Would that be fair to my Daughter and Husband. Will you be sharing a kitchen, there's a minefield all on its own.
Who looks after the garden. Who does the DIY. Are you tidy, GPs not?
I hope you understand what I'm saying. We all put our cards on the table and came down against it.

As there is no IHT exemption between parents and children, then you need to know how you would meet the tax bill on their death. As indeed would they, should you die. It might be worth seeing a financial advisor alongside a solicitor.

I take it you have no siblings?

IHT should not be a problem unless there are substantial other assets as you would have two allowances. However again worth finding a reputable local firm of solicitors and having advice of estate planning/wills specialists feed into the conveyancing.

I agree with Fingeronthebutton. A lot will be about the day to day stuff, including how to maintain privacy and independence. As well as some frank discussion around the 'what ifs'.

This is all really useful thank you.
The plan is that we would not live there with them - we live in our FIL's house! :) FIL spends most of his time abroad. I do have a brother - he has severe learning disability and lives in a residential home (we are hoping to move him into our borough but that's a whole other issue). My parents are setting up a £20k trust for him separately - if he inherites too much money he may lose his paid for care which obviously we don't want. My DH is likely to inherite quite a substantial amount of property on his fathers death so there will probably be a big ITax Bill somewhere along the line but the property we are hoping to purchase with my parents should come under the £325k threshold especially if we split it between DH and myself.

Just to add: my parents are in their late 70's and late 80's. Grandchildren are 6 and 3 and we are in our forties. Talked to a mortgage advisor this morning who said some providers would not like my parents age - didn't really get this as they would but be paying or applying for the mortgage just contributing lump sum and having a stake in property ...Confused??