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Original poster

Mum in care home and self funding as owns half of house

11 replies

lsmitheringale · 11/03/2015 15:49

Can anyone please advise me with the best thing to do with Mums house? My mum owns 50% and my brother, sister and I own the other 50% between us. We have set up a deferred payments scheme to pay for Mum's care home costs and we have currently accrued about £35,000 against the value of Mum's 50% share of the house. We are thinking of the 3 of us buying Mums 50% share but not sure how to value it. We have been advised that a 50% ownership in a house is worth a lot less than 50% of the market value as very few people would like to buy half of a house. Please can anyone advise how to get a valuation for half of a house? Any advise would be welcome thanks.

OP posts:
MNHQ
BeccaMumsnet · 13/03/2015 10:35

Hi there lsmitheringale - we're just going to pop this in a more appropriate topic for you to get the best advice.

specialsubject · 13/03/2015 16:37

so (to put it brutally) when your mother dies you sell the house and pay the care home fees from the proceeds?

what happens if she outlasts the value of the house?

I'm not totally clear on your question, but what is the house worth now in total? Is there a reason you can't just divide that by two and give your mum that money?

BTW are any of you living there at the moment? If it is rented out you are accruing capital gains liability.

atticusclaw · 13/03/2015 16:39

Accruing capital gains tax liability??? Confused

ThinkIveBeenHacked · 13/03/2015 16:42

Is she in a care home now? If so, sell the house now. 50 percent to be used against care home fees, 50 percent to be split between the three of you.

cupcakesandapples · 13/03/2015 16:42

Hm id imagine that the la will want the house valuing and then your mums share calculating from that value.

I would buy her out now if you could afford it and use the proceeds to pay for her care. Im assuming when that money runs out she is entitled to state funding?

specialsubject · 13/03/2015 20:37

if the property is not the principal residence of the seller, it is liable to capital gains when you sell it.

Which I also suggest doing now.

TeacupDrama · 14/03/2015 10:06

I take it, the 50% you and siblings own was your DF 's and is your deferred inheritance as mum has life time interest in his half, if house sold now, mums share for care home fees your share possibly liable for inheritance tax but not capital gains on top. The care home has no claim on other 50% however long your mum needs care for, even if her money runs out, however if her money runs out, there is a weekly limit on what social services will pay.

Obviously house was principal residence of your mum so she will have no tax to play on proceeds

Original poster
lsmitheringale · 16/03/2015 09:10

Thanks to you all for your helpful messages. I think we are sorted now. Yes we did inherit Mom's share of the family home and my niece is living in the house at the moment. If we can, we are going to buy out Mom's share so that we can pay off care home fees and what is left from her share can be used for the future fees. I don't think that we will need to pay inheritance tax as we will be well below the threshold and hopefully no CGT to pay as family still live in the house.

I think with the pension that Mom gets from Dad's work and her state pension (about £300 per week total) she makes enough contribution to the care home for social services to pay the additional £300 per week balance when her share of the house is exhausted. The lady in the room next to hers only has a state pension and all of her care is paid for by the council so Mom should be ok.

Thanks again,

OP posts:
specialsubject · 16/03/2015 12:43

unless the niece is an owner I think you do have a CGT liability. What that will be when you sell is of course anyone's guess.

TeacupDrama · 16/03/2015 15:03

Do you mean dads share as mum still living is your niece paying market rent, there is only capital gains to pay on the value increase on the dads share since his death so if house was worth 200k, their share is 33.3k sack moms still has 100k, if property now worth 230 k, their shares are now 38.3 k a basin of 5k this is below capital gains threshold so unless a massive gain in value since dad died unlikely to be applicable if you inherit a house it is valued at probate to see if inheritance tax due as part of estate, you do not pay capital gains on inheritance if sold within 6 months, if value has increased more inheritance tax might be due, however if you do not sell for years some capital gains maybe payable if value increases this would also apply to inherited art or antiques etc

TeacupDrama · 16/03/2015 15:08

Do you mean dads share as mum still living is your niece paying market rent, there is only capital gains to pay on the value increase on the dads share since his death so if house was worth 200k, their share is 33.3k sack moms still has 100k, if property now worth 230 k, their shares are now 38.3 k a basin of 5k this is below capital gains threshold so unless a massive gain in value since dad died unlikely to be applicable if you inherit a house it is valued at probate to see if inheritance tax due as part of estate, you do not pay capital gains on inheritance if sold within 6 months, if value has increased more inheritance tax might be due, however if you do not sell for years some capital gains maybe payable if value increases this would also apply to inherited art or antiques etc

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