Rent my mums house ??

[Sjxo92]

Abit long winded.... I've been private renting the same house for ten years. Very small and cramped with no parking. My mum can retire in six years.. her plan was to sell her house and give me and my brother around £10,000 each to potentially get onto the property ladder... We spoke today about the possibility of when she retires me moving into the house and pay her rent as she wants to get a retirement flat. What are the rules of renting to a family member ?. I also get universal credit on top of my wage. I work 31 hours a week but my wage is below the threshold so I also get help with my rent. Would I still get some housing benefit if I rented from my mum when she's living somewhere else ? . It's a lot of looking into and I seem to be getting different answers online. It's six years away yet and anything can happen by then. Hopefully a lotto win haha

The rent would be taxable in your mum's hands. And if you stayed there for longer than three years then she would also start to accumulate liability for capital-gains tax assuming that she does sell it (or even give it away) later in her life.

You can only get housing benefit to cover rent paid to a family member if the agreement is genuinely an arm's-length commercial arrangement (eg your mum would evict you if you stopped paying).

(If your mum plans to move into a retirement flat by buying it my recollection from looking at this is that it's a massive rip off. The terms are designed to fleece elderly people of their accumulated housing wealth.)

Can you explain more on the retirement flats ?. I haven't looked into them just my mum has mentioned that's her plan when she's 66 is to buy one :/

I'm not that knowledgeable, but when I looked it seemed that you got fleeced in all sorts of ways even though you "owned" the flat.

You may have to buy it direct from the developer, meaning they set an inflated price, you'll probably be paying high ground rents or service charges while you're there, and when you come to sell the flat it may be that you can only sell back to the developer at a lot less than they will sell it on for. And you can't rent it out to anyone else. It's not at all the same as buying, owning and selling a normal flat.

Just check carefully before you do it. My feeling was that you'd be better to rent somewhere with a fixed monthly cost that was clear and transparent.