Inherited Macartney&Stone retirement flat - anyone rented one out?

[damemaggiescurledupperlip]

We inherited a one-bed retirement flat from DH's parents over a year ago. It has been listed for sale since then, but no real interest.

An alternative would be to rent it out. Has anyone done this in a Macartney and Stone development?

(I don't want to be a landlord, but the ground rent, service charges and double council tax do stack up. We have lowered the price twice, but nothing in the block is selling.)

Fair enough. I thought you might be referring to a different type of flat. No offence intended.

If there’s no mortgage to cover I’d just market it at a very low price. In the future I might consider one myself in the right location. But I’d only buy at a rock bottom price so I’d know I’d have “saved” years of the service charge. There would still be the concern of leaving relatives with a burden but I’d just tell them to sell it for whatever they could get.

I'd look to slash the price drastically, or auction it. What is the point of keeping it if the value is unlikely to go up as they keep building more? It just postponed the problem. It was inherited, so even if you get much less than originally hoped, it is still free money. Unless you want to move there on retirement of course.

bottom line with M&S property is the person who actually bought it will (generally) very much enjoy what remains of their life in living in it.

the angst comes when the owner is dead and the relatives gather to pick over the inheritance and discover it is not what they expected to get

It was inherited, so even if you get much less than originally hoped, it is still free money. Unless you want to move there on retirement of course.

@HarryVanderspeigle That’s how I view my Dad’s flat, it’s working well for him right now. Given its brilliant location, it could even be a good place for me in the future, who knows.

That’s the point isn’t it that many others miss- if they had to be in a care home , it’s a damn site more than the £125 - £160 week average service charge. More like £1500 - £1700a week . I am very much of the view that it’s better to rent but if you can get a well priced second hand one in good order, in a good area then they can be a decent option ‘provided’ they have plenty of cash in the bank still to cover off several years service charges and council tax - or be prepared to give it away for next to nothing -
there are suprisingly quite a lot of pensioners who have money banked ( either inheritances in their 60s or pension payouts or other house sold) and could easily afford the monthly service charges but as they are beyond the age to get mortgages don’t want to spend out all their capital be it via inheritance or pension or previous home solely on a flat that will lose money. if I can also mention too it can be really sensible to give a place a refresh, it’s depressing seeing how many of these places clearly have never had so much as a decorate or a kitchen or bathroom refresh or new carpet/flooring- even when 40 years old - one that’s been upgraded stands out a mile.

one problem I’m afraid is that an awful lot of people hang on because they in their head have already spent the inheritance - I woukd factor in and make peace with getting zilch - anything else then is a big bonus

My mother had a great pension, so the service costs were covered.

But she would have been appalled at how long it took to sell and how stressful it was for us, though. Knowing what I know now, I would never put my kids through that.

Thank you @ChimpanzeeThatMonkeyNews Yes, that phrase is very apt here!

That's outrageous, and would never have happened to a man!

The nearest cheapest retirement flat to me is a M+S for 40k with 8k a year service charges. It does include 1 hour per week of domestic help and you can purchase more if you need it

I suppose, if you moved in at 70 and lived there 10 years in relative good health before something quick kills you off like a heart attack (no lingering), it would be 120k for the last 10 years of supported life.

Not a huge amount of money, but obviously they're very small and thats very cheap.

This is how I am hoping the end of my life will play out. Obviously there are no guarantees though.

I think you’d be completely mad to rent out - increased income tax, maintenance and insurance costs, management fees (potentially) and those high service charges will mean very little return on an asset that as you have discovered has little market value. You will just be kicking the can down the road by creating increased responsibility for yourself. In your position I would drastically cut the price (it’s all “free money” for you as an inheritance) or - nuclear option- relinquish the leasehold. Your relative would not want you to have lost money over their legacy.

Today’s news.
www.bbc.co.uk/news/articles/ckgykp79ezyoToday’s news.

I also came on to say these flats are in the BBC news today and not in a good way

Loads of empty flats that people can't sell but they are building blocks of new ones.

To be brutally honest, they are only "difficult to sell' because the vendors expect "a reasonable return of capital" from the original purchase price. That's the problem.

Firstly, the original purchasers overpaid for their flats versus what the same flat would have cost on the open un-age-restricted market. The price should have been at a significant discount given the restrictions. The benefits of retirement complexes are covered by the large service charges - not the purchase price.

That link doesn't work. Try this one.

www.bbc.co.uk/news/articles/ckgykp79ezyo

Just been on BBC breakfast, people dropping the prices really low but very high service charges, it's a scandal that these places are empty when we have a housing crisis.

I’ve said this many times. It’s a house purchase like no other. We are programmed to believe that property is an investment in this country.

Buying a retirement flat is very different.

I would only rent one of these and that would be if there wasn't another suitable housing option as I wouldn't want it to be left after I die. I imagine OP that a lot of people perhaps feel like this so I would probably try renting it out if it's allowed.

I wish there were more of these properties available to rent. When i was looking for somewhere for my father there were never any for rent. I asked the agents and they said it's because the owners have to be over X years old, not just the occupiers, so that rules out most professional landlords, and most families who've inherited them. Also he said that to cover the service charges the rent would have to be very high. But honestly as a potential renter i wouldnt have minded the high rent - it would still have been less than stamp duty etc. So if your agent is saying they have people queuing up to rent it, please go ahead! As a potential renter I would have liked to know my Dad would have life long right to continue renting (i wouldn't have wanted to risk him getting booted out and having to move him again when he was already in his 80s), so do consider that.

My in-laws are in a similar type of development and it is the best move they have ever made. Their previous home was undecorated since they'd moved in the 1980s and full of clutter with lots of stairs. They moved two years ago in their early 80s and have made loads of friends and have a much more active social life than before. There is an on-site restaurant where they eat every lunchtime and they attend several activities a week.

They have each fallen and broken a bone since they have been there, but what would have been disastrous in their previous home has been smooth-sailing in a development designed for their needs.

All this comes at significant expense. Yes, there would be a greater inheritance if they had tried to manage with occasional carers in their old home (though took a steep discount anyway as it was all 1980s decor). But their final years are a thousand times better as they are not isolated, have an active social life and we have much less stress as we know they are ok.

It will probably we a pain to sell but we do not expect any inheritance.

In the bbc article the owner has reduced it by £50k. But it’s still £170k. If he marketed it below £100k he might be able to offload it. If there’s no mortgage outstanding why does it matter what he gets for it as an inheritor. I can’t understand why people have such price expectations. As others have said they are a different type of purchase and the issues are well known.

Having said that it is terrible that we have such a shortage of housing and there are thousands of these flats lying empty. Don’t know what the solution is though.

Because supply outstrips demand, the price is not the main hurdle to sell. It’s not like the mainstream non retirement market.

And even at a low purchase price the monthly fees are off putting.

I think what is needed is to know how to deal with this if you inherit.

Its not as simple as saying lower the price, that flat I found near me for 40k has been on for ages, what could it be further reduced to? 10k? zero?

If you literally give a flat away, does that come with tax implications of not selling at 'market rate'? If you inherit a flat does HMRC have a rating of the value and if so, a year later you virtually give it away, are you seen as doing something wrong tax wise?