How to move/buy house with a DP - feeling really stuck

[MQu]

i am feeling quite stuck and down about this situation and would appreciate some gentle and wise counsel.

(NB I live in the north, and these figures are going to be much smaller than we often see on MN!).

I, 45F, owe my house outright. It’s worth about £150k and I have savings of about £20k.

Been with DP (M51) for 10 years. He moved in with me and never paid rent. This was my choice as a) I was on a good salary and didn’t need the money, and b) after my relationship with exDP ended I didn’t want a man having any kind of claim on my house.
I now work for a charity and earn much less than I was, £30k, but love my job.

DP bought a house 5 years ago so he had some financial security and asset). He rents it out but still pays some of the mortgage on it each month. He has about £50k equity in it. He has zero savings having just completed a PhD. He works pt (making about the same as ft me, possibly a bit less) and is trying to get back on his feet financially, whilst still working on the academic side.

The problem is, we both want to move house. We would like to move to a smaller house and out of this city. We’re looking at least £145k for where we’d like to move, realistically £250k.

Im just not sure what to do. I’m very reluctant to go in financially with DP. And I don’t want to take on a large mortgage, which we’d need if DP was to match my investment.
Previously the plan was for DP to buy alone at the lower end and I could rent my house for a few years. That is not on the cards now as DP struggles to see what his future looks like in terms of jobs. He thinks given his age a new mortgage would be problematic.

What should I do? This situation is getting me down.

Yes, I hadn’t thought of capital gains tax. I’ve tried googling, is it applicable if it’s the only house I own?

Yes, but you’ll get relief for the number of years you lived there. I wouldn’t do this as a long term solution. You don’t only pay tax on the amount it’s increased since you started renting it out, you pay tax on the amount it’s increased since you bought it. If you bought your property quite cheaply years ago you could be looking at a hefty bill by the end. I recently sold a property which I lived in for a decade and then rented out for 9 years. It hardly increased in value during that the time it was rented but I ended up with a 50k CGT bill when I sold it.

Ouch. I don’t think mine would be that bad due to low house prices and not much profit gained.

It’s putting me off the hassle of renting mine out though.

Tenants in common

You buy your half cash and he buys his half with a mortgage and savings.

I appreciate that, but I believe we’d both be liable for the mortgage repayments on his “half”.

Yes, that’s true. If you’re worried about him being financially unstable to the point that he would miss payments then it would be a no from me. Either that or he keeps 6 months of living expenses in the bank in case of job loss and owns a smaller share in the house. It’s not really your problem though, you’re sitting pretty in your current situation so it’s up to him to demonstrate that he’s someone you’d want to take a financial risk for. If in doubt do nothing (that’s the point that I’ve got to in my situation)

On a completely personal note I would not give up my financial independence for ANYONE. Under any curcumstances.
I really hope he has been paying his share of the bills!

We have different approaches to money, for example I track every pound I spend in a spreadsheet. He’s a lot more relaxed. I fiercely guard my financial security, he’s “lent” friends money in the past.
The biggest reason though, is that I almost lost my house when exDP walked away. He was the last person anyone expected to do anything like that. Similarly, DP’s ex really took advantage of his good nature when she left him (hence the long mortgage he currently has at this age).

I’d take the thing about his ex taking advantage of him with a pinch of salt. Either she was entitled to that money or he didn’t protect himself enough which is on him. Attitudes to money and spending is a big sticking point in relationships and if he’s not someone you’d go into business with then I wouldn’t buy a house with him. It doesn’t mean you can’t be together x do you have children?

I know you said you didn't want to charge him rent but he has lived with you rent free which has enabled him to buy a house and he's now working part time with no savings.

If you're mortgage free, I can understand why you are reluctant to want to then have a mortgage (even if it's a small one).

I think I'd keep my own house to be honest. He sounds too wishy washy and may expect you to financially subsidise him going toward

We have different approaches to money,

Then buying together is NEVER going to work. Don't do it. However your DP should have been paying you some form of rent instead of living off you. He can afford to be generous with friends and living in the moment because you are subsidising him.

Similarly, DP’s ex really took advantage of his good nature when she left him.
Yeah right... they always say that. But he's not taking advantage of your good nature though is he? 🙄

Look, his ex did take advantage but I understand why some of you would be skeptical. I don’t think it’s worth us trying to change each other’s mind.

No children involved anywhere.

His loaning friends happened many years before we met.

The decision about rent was mine, for reasons already explained.

I think we will give it a few more months whilst his job situation settles down. In the meantime I’ll continue downsizing my stuff, prepping my house for sale, and spending some time exploring the towns nearby a bit more.

It sounds like you've already decided despite the fundamental differences to money. A saver and a spender sharing finances will never, ever work. Long term it just builds up resentment and anger and will kill the relationship dead, whereas keeping it separate can help keep the relationship going forwards.

I wish you luck in whatever you eventually decide.