Considering Granny Annexe

[potofdreams1]

Apologies to anyone who's already replied to
my previous thread on 'Money' - didn't realise there was this topic.

Fully realise this is fraught with various problems and pitfalls but would appreciate thoughts/advice.

Elderly DM is 75 and really declining mentally and physically. She lives a good 30 minutes away and as I work can only get across to her about twice a week. A few emergencies have really emphasised how far away she lives. She lives in a bungalow but is finding it very difficult to manage. She also feels lonely and isolated since losing a few close friends.

I live in an average sized house but am lucky enough to have a huge garden. She could be tucked in a corner where we could all have privacy.

DM has suggested selling her place and we build some sort of granny annexe for her in our garden.
This seems like a good idea on many levels - closer to us, able to support and can keep an eye on her. Take away worry of maintaining her house.

However, I have DB who whilst living 3 hours away and therefore not able to help out, obviously still needs to part of any agreement. He agrees we need to consider options but isn't keen on having her live with/near him. Also DM's life is here.

DM's total assets including the house are well below IHT threshold but I still need to be aware of
other implications and while I can't afford to shoulder all costs, the last thing I want is to be seen as profiting from her.

One suggestion (hers) was selling her house and proceeds:
One third to me
One third to DB
One third retained by DM.
A small annexe wouldn't increase our house value at all so how it would be funded would need to be considered.

Aware of council tax implications.

So from my part I would build annexe. I also take on any care she needs; although if more is needed she still has some capital left to pay for it with.

Can you throw all reservations/points at me please!

Care costs are incredibly expensive- you do not know what your dm will need in the future. Look up deprivation of assets- others will explain more@hatgirl and other wise ones.

Thanks Sandwich
@hatgirl would be grateful for your thoughts

It's always better to keep people who are quickly declining mentally in their own familiar environment as long as possible. Usually people who are experiencing that kind of decline don't respond well to being moved somewhere strange. It can be catastrophic in fact.

If you are being realistic how long will it take to get a granny annex built? What would you do with it once it was no longer needed?

Unless you were planning on reducing your hours at work surely during the day the situation remains the same as now, just in your back garden instead (can it be accessed without going through your house?) , but you have the benefit of being able to pop in at night and at weekends. Would it be an annex or a separate building?

Your mother would be on sticky ground if she disposed of her assets with the knowledge that she may need care in the near future. I don't think building the annex with you would be the main concern though (people are allowed to move house after all), it would be your DB's cash share of any proceeds of the house that would be problematic. If she needed residential care they would assess her as if she still had all the money she had given away in her own account. If it's a separate building rather than an annex there's a chance you would be expected to put it on the market to pay for her care or offer a cash equivalent...

Obviously only you know your own circumstances but you do need to look at from all angles. Ultimately she could be in the annex for only a few months or up to over a decade, maybe two. It might seem like a short term solution but long term what impact will it gave on your own family life?

The one thing I advise to do with urgency if you haven't already is to get lasting power of attorney sorted out for both finances and health and welfare if your DM is able and happy to.

Be very careful about the disposal of assets thing, a family friend got into a difficulty with this (they had used the proceeds of selling the parent's house to help buy a larger family house with a separate granny annexe). Sadly the parent died before the case was resolved, it was a lot of extra stress at an already difficult time.

Thank you.
@hatgirl would you mind in I PM'd you?

Yes that's fine

In reality if she's deteriorating this quickly it's unlikely you will get PP, architects and the actual build done in time for it to be worth the upheaval.

We did the same as you except we sold our house and used the equity to build the annexe (cost around £100k) at mums, we then transferred the house into joint names.

I also take on any care she needs; although if more is needed she still has some capital left to pay for it with. Don't be too ambitious. You will by default be the decision maker and the manager who keeps all the pieces together. You will also by the on-call person, on duty 24/7. That's a big enough job without taking on the caring role as well.

You also need space for just being a daughter, having time just to chat.

Quicker than building an annex (which couldn't be started until she has sold and moved out) would be to sell hers and find somewhere small and close to you, house prices in your area permitting. But again it might only be for months.

When I say deteriorating- it's majjnly the worsening of athritis and associated symptoms, which makes her much less mobile or able to properly manage her home.
Being much less mobile is causing isolation and affecting her mental health.

Building something here for her seems to tick so many boxes but am acutely aware of the advice being given here

I suggest you get legal advice on the granny annex and deprivation of assets question - Iirc, there is a legal solution to it, but I am not a lawyer.

Thanks Mont. taking things very slowly and getting professional guidance