Living arrangements when you both own properties

[AmelieZ]

For those of you that maybe met in later life (but pre kids), how did you arrange your living situation if you both had separate properties when you met?

Keen to see what others have done, as I'm struggling with my DP on how best to move forward. We both own a property each, and will most likely live in his one as it can't be rented out (H2B). Not sure whether I should sell mine or rent it out.

hopeful bump!

Is there much equity in yours? Would you feel at home in his?

Are you planning to have kids? If so you need to get married, sell your own properties and put in equally to a new one, anything left over becomes your joint savings pot.

If you are not planning on marriage and babies then I would be very careful. You need to preserve your position. Equally it's not fair to live with him and have him continue to pick up all the costs.

If you sold your house would you be able to pay off some his loan and thus buy yourself a share in that home? You need a proper, clear legal trail if you do this.

@HollowTalk

Is there much equity in yours? Would you feel at home in his?

£500k equity in mine. Yes, would feel at home in his I think.

@Northernlurker

Are you planning to have kids? If so you need to get married, sell your own properties and put in equally to a new one, anything left over becomes your joint savings pot.

If you are not planning on marriage and babies then I would be very careful. You need to preserve your position. Equally it's not fair to live with him and have him continue to pick up all the costs.

If you sold your house would you be able to pay off some his loan and thus buy yourself a share in that home? You need a proper, clear legal trail if you do this.

Planning on kids hopefully if all goes well.

If I sold, I wouldn't want to buy a share in his, as I believe he is already in negative equity and I can't see the value increasing within the next 5 years.

We had this situation. I moved into his house and rented out my flat (properly, following all laws etc). Once we married I sold the flat and we bought a larger property together with space for children.

@PragmaticWench

We had this situation. I moved into his house and rented out my flat (properly, following all laws etc). Once we married I sold the flat and we bought a larger property together with space for children.

What was the timescale for the above?

Keep yours for now.
Rent it out.
Pay him half the income.
So then you each have a property that is being paid for and you are each covering half a mortgage cost, as you would be if you shared one property.

We had this situation too! I moved in to my now husband's house because it was bigger and rented my flat out.

Then a couple of years later we decided to buy a bigger family home together and sold them both.

We live in 'his' house and rent 'my' house out. His house is bigger and in a nicer area so that decision was easy.

Initially I kept mine in case our relationship didn't work out. Now, it's a an extra source of income and we will probably keep it til we retire.

I am not especially keen to rent mine out due to the tax implications and also the hassle. Wondering whether it may be better to sell, and reinvest elsewhere?

If you sell yours and invest it I would make that crystal clear that that money is ring fenced. Do not dip into it when the children need shoes or when you’d like a nice holiday or to put a bit extra towards the wedding.

I know it sounds really unromantic but you kinda need to draw a line in the sand and ideally go and get an independent Rics surveyor to tell you what his house is worth the day that you move into it and then if you’re going to be contributing 50% of the mortgage which you ought to be, along woth maintenance, decor etc, should it go pair shaped you’ll be able to point to the exact time and date beyond which you are entitled to the actual gains of the house price.

The same does not apply to him because your money is set aside and he is not contributing to that investment.

To be totally honest though I just wouldn’t get married.

Be aware that as you're unmarried, if you do move into his and pay towards his mortgage, if you did later split up you don't have as much legal protection as a married partner and might not be entitled to any of the house even though you've paid towards it. Unless you got a deed of trust. I'd keep your own house and rent it out, and then maybe look into selling it if you do get married and then buy a house together maybe :)

@StageRage

Keep yours for now. Rent it out. Pay him half the income. So then you each have a property that is being paid for and you are each covering half a mortgage cost, as you would be if you shared one property.

I came here to recommend this. If you can rent out yours it would be a great income for you to enjoy. Obvs set it up properly so nothing can be contested should something happen.

@AmelieZ

I am not especially keen to rent mine out due to the tax implications and also the hassle. Wondering whether it may be better to sell, and reinvest elsewhere?

What type of investment? I'm not being nosy but the type will matter.

Another house? Then your throwing money away with estate agent fees, mortgage fees etc to end up with a different house.

Stocks and shares? Ok but make sure they are easy to liquidate. If the worst happened and he threw you out, you would need money to store your stuff and live in hotel/Airbnb/rental for 6 months while you found another house.

Savings account? Good for access, not much interest.

What I did. Kept my own house, rent rooms out legally. If it came to the worst I could find a 6 month rental until I could get my own house back. And carry on my tenancy 1 month at a time if needed. I would also help my tenants find somewhere else to live and pay them if they left early.
Its been 8 years and my mortgage is almost paid off. So I've gained in a good way. I would never have moved in with current DP without my potential escape already embedded.

Just for info, if DP wanted then we could sell both and buy together, with my portion protected.

I would probably get another house that needed substantial reconfiguration/development and slowly bring it back to life. That would be the most tax efficient of options as it would still be classed as my primary residence.

I like the idea re renting rooms, as maybe that would allow me to technically stay in my place as get lodgers in the free rooms. So I then have a place to retreat to if necessary and also somewhere to use as storage as I doubt I'll be able to fit all my stuff at DPs

Renting in this scenario is not the cash cow it may once have been and frankly is a hassle (I have 6 properties, I know of which I speak!) In your situation you should sell and invest in your pension and ISA’s and other varied funds to provide for your longer term security. You need some good financial advice. But to reiterate, renting out a property is not the best way to make your money work for you.

And if you rent rooms but don’t in fact live there most of the time those “lodgers” might well be deemed “tenants” which brings with it both legal obligations (eg HMO licence) and makes it far harder to evict if necessary.

@VanCleefArpels

And if you rent rooms but don’t in fact live there most of the time those “lodgers” might well be deemed “tenants” which brings with it both legal obligations (eg HMO licence) and makes it far harder to evict if necessary.

I was about to post the same thing. I’d try renting it out first.

We decided to keep both our houses and just split our time between them. We tend to do weekends at his and weekdays at mine.

That would be the most tax efficient of options as it would still be classed as my primary residence.

Are you not going to live with your partner?

But to reiterate, renting out a property is not the best way to make your money work for you.

I agree

Our properties are only 2 miles apart, with not enough space for me to keep all my stuff there. I was thinking of being there most of the time, but having my current home as my 'base'. Getting a lodger or two would cover all my costs. Eventually however, I would sell the house (within 5 years).

Or, I could just sell now (within 1 year, once I am comfortable in the new place) and reinvest elsewhere.

We lived separately for 1-2 years then he moved into my house. Although he lived in the nicer area, my house was much bigger and more practical as we were expecting a baby.
We sold his house as running 2 properties was becoming too expensive. Once his sold we marketed mine (in hindsight this was a mistake and we should have marketed both at the same time as it took forever after time wasting buyers and chains needing to complete etc).
We then bought together but I have 80% and he has 20% equity. I am loathe to share this equally if we were to get married.
We bought a renovation project but it's slow going with 2 small children. When we move on I will reassess the % split dependent on if I decide he's put enough extra money in.

Forgot to say that we decided to sell rather than rent out due to hearing horror stories from people my DP knows.
Also my mum rented out to a friend - who then stopped paying rent and trashed the house. Did a moonlight flit eventually after mum offered her some money to leave. House was in a right state.