Is anyone else holding off from buying until they inherit?

[sigletty]

We currently rent a small flat in a naice area. Because of interest rates, a mortgage on a place in this area of London would cost a fortune. Likely double what we pay in rent.

As awful as it is to say, we have decided we won’t look at buying until we inherit. Obviously nothing set in stone, but it’s not unlikely we’d inherit a significant sum in the next 5-10 years. We’re both only children and the only grandchild to two very elderly and dear family members.

So are you hoping to inherit from grandparents or expecting your parents to sell any potential inheritance with you?

Find this mindset quite unpleasant. Get on with your lives and provide for yourself! Should your relatives be fortunate or kind enough to leave you something in their wills that should be seen as a pleasant surprise, not something you are banking on and factoring into your financial plans. If it gets spent on care home fees are you going to be begrudging them end of life care as you see it as your entitlement?!

That is true. We gave our daughter a big financial gift to help her to buy her first flat. It wouldn’t be considered deprivation of assets due to our ages (I’m in my 50s) but I did have to sign a form at her solicitor’s to say it was a gift not a loan. The mortgage company needed that information also.

You can give away any money you like as long as you do not (at the time of giving) have any need to use the money for funding your own care (or any reason to think you would need it). There is no time limit either - that's for IHT upon death. The LA can look back as far as they like, the key thing is you had to know you needed the money for care and you had to be intentionally reducing your ability to pay.

Yes but the 7 year rule still applies if it's more than 3k. But in your 50s hopefully unlikely to be an issue.

Here’s hoping @Want2breakfree !

Deprivation of assets and the 7 year rule (for IHT) are different. You can 'deprive yourself' of all of your assets if you like, but not if you knew you would need care at the time of giving the assets away.

Separately, IHT would be payable on any assets gifted within 7 years of death (over the small annual allowance).

Agreed

Unwise

I agree. I cringe when I hear about people doing this. It's so mercenary. And also high risk. They may live a lot longer than you anticipate and even if very wealthy, a lot could be swallowed up in care costs. Also, nobody can afford to buy where they rent in cities, that why they move out. Yuk.

So you are just waiting on loved ones to die? Not a perspective I can empathise with at all tbh!!

DH was lucky enough to inherit from his mum 5yrs ago. He was nearly 70 though, I'm glad we didn't base our lives & living situation on what might have happened in the future, it's no way to live.

Given the number of people who say they're saving for their kids I don't understand why people are so cagey about it. Most parents would rather gift the money when their children need it and enjoy it with them not 30 years down the line when they're dead and the kids too old to make the most of it.

Have you actually spoken to your parents, OP, about the challenges you're having? They may surprise you and offer to help.

Agree with PP that you might not get any inheritance at all, or it may be less than you are hoping for, or what is needed to ultimately buy a house.

About 5 years ago I had a similar mindset to you. My grandparents were elderly and struggling in their mid 80s; I assumed they weren’t long for this world and knew that their will stated I was due to inherit a portion of the estate.

Well they are both 90 now and my grandmother is in her 4th year in a £1k/week nursing home and looking healthier than ever. The amount I will receive (if any, now) will be substantially reduced.

I’m glad I saw sense and bought a house in 2021

Em, no. Pay your own way in life. Maybe they’ll use it all for care or leave it to the cat and dog home instead!

Not in my case, and it wouldn't be smart for me to do so!

But I know people who are doing this - some are open about it and in other cases it goes unspoken. I think it is because English families have been smaller, and many have owned their own (often modest) home. Whereas my grandparents generation in Ireland would have inherited nothing, had many siblings, half a dozen children and twenty grandchildren, so we all inherit a tenner and their best wishes for the future.

Exactly this.

OP you're wishing their lives away and your own really.

If you're looking at about 10 years, thats a third of mortgage length (or more)

I think it's foolish. A lot of what people think they will inherit never materialises for a number of reasons- new marraiges, health care costs, scams, charity donations, devaluation of assets.

The amount of people I know how thought they were getting a large inheritance only to have it wipped out by the previous banking crash (shares useless overnight etc) is very high.

Would you not be better of planning without it now and you can always sell & upgrade or knock a chunk off the mortgage if it does materialise in time?

So are you expecting to inherit from grandparents, from your OP? Everyone else has obviously made the point that with care fees or deprivation of assets there may not be any inheritance anyway, but why are you so sure you'd inherit rather than it all going to your parents?

Sounds like pure greed to me. How do you know you’ll inherit anything? If you saw your dream house next week would you be wishing them dead?
How about you grow a pair & buy your house with your own money?

It’s only deprivation of assets if the grandparents are doing it to avoid paying fees, not if it’s a gift to help fund a house move. If they’re not due to go into a care home soon or have any suggestion of this, then that would be difficult to prove.

So many people on here use this as a reason for an older person to hang onto money ‘just incase’ even though a small % of people end up in care homes, and on average, for about only 3 years.

Nothing is guaranteed due to care home costs etc but also as we've seen on threads on here, if OP's dad dies first lets say, his money goes to her mother, if some man comes along and sweeps her off his feet and then she dies, her money goes to him, not OP.

You are absolutely spot on. Forewarned is forearmed though.

My SIL has paid out £1.2 million for her parents care over the past 14 years

I bet they all wish they'd shared the wealth with the grandkids at a younger age!