Buying share of flat from parents - good idea?

[Unmute]

I'm renting a flat my parents own. I pay market rent and I can barely afford it on my current income, but I have a lot of savings. I'm working full time, but on a temp contract so I don't want to get a mortgage even if I could find someone who'd lend to me.

I'd like to buy half my parents' flat, and pay them rent on their half. This would give me somewhere to put my savings (which are currently in a bank account with a stupid low interest rate), and halve my rent so I could afford to study, get a job I actually like, or work shorter hours, relax a bit. My parents would be able to pay off their mortgage and dad is keen on this idea as he's retiring this year.

I'd want ds to inherit my share of the flat if I died. I'd imagine we'd share maintenance equally.

I'll talk to a solicitor, but I thought I'd test the idea with you lot first. Is it workable? What sorts of things do we need to consider? It doesn't seem too complicated to me, but I'm probably missing something. We're in Scotland if it makes a difference. Any thoughts?

It sounds like a win win situation.

What is your relationship with your parents like? If you trust them to stick to agreements it sounds good.
One thing to consider is if you have siblings, might you (or your parents) need to explain the situation to them? So they know it is yours because you paid for it, rather than favouritism?
Think through what will happen if you default on your rent. They can't evict you if you own half. So they have to really trust you!

You must get a deed of trust drawn up setting out what rights each of you have. Your right to rent - a mechanism for resolving disputes over rent, and the circumstances in which the property can be sold.

Check what the situation would be if they needed to raise money to pay for care. Would their share of the flat be taken into account? Would a sale be able to be forced?

Thanks all!

I hadn't thought about what would happen if I stopped paying rent. I have a good relationship with my parents and wouldn't do this, and even if I did they wouldn't want to kick me out, but it's worth making all the possibilities clear to everyone.

I think this would be a medium-term solution, and we'd sell in a few years once ds has left home and I'm in a better position to get a mortgage, so care for my parents is unlikely to be a consideration. They're early 60s and stupidly healthy.

I have a sister who thinks I'm the favourite (because I am) but I'm fairly sure she'd feel this arrangement was fair. I'll talk to her about it.

Would they have to pay CGT - capital gains tax on the sale of the portion to you? If it has increased hugely in price they may have to.