I own a house in my name only. My wife and I own our own house outright. In the house that I own lives my step-daughter, her husband and 2 kids. My step daughter wants to buy the house. The house is valued between £105-115k. My asking price was £95k because they have lived in the house, paying a rent that covered the mortgage, for 7 years. I bought the house for £37k. They can only afford a mortgage of £75k, which is 3.5xhis salary.should I tell them they can have the house for £75k or should I stick to my £95k? There are other children and step children in the family. Should they be consulted as to the decision to sell or not to sell? HELP!
2007-09-03 02:27:08 · 17 answers · asked by Anonymous in Family & Relationships ➔ Family
Tricky. Consider your options logically
1 Your wife will be emotionally involved and want you to sell the house at £75 for her daughter's benefit
2 Your children and other step children may be offended at her getting £30-£45k as equity gifted to their sibling
3 You get the instant profit less the CGT which gives you money to spend
4 Morally, without your step daughter, there would have been no house I would guess, so no profit
5 They've paid rent for 7 years so deserve some discount, but is that too much at £35k?
6 Can you negotiate deferred payments?
7 Wouldn't want to have to decide this one!!
2007-09-03 02:53:45 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Thats a heck of a financial difference - and its too much money for you to lose.
If he's on £21k a year he's either not old enough or responsible enough (a "decent job") to justify giving that money to - and they aren't old enough /reponsible enough to buy a house. 3.5x21k as a mortgage will mean they come cap-in-hand to you for other money - he will be making about £15.5k a year after tax = a household income of 1291 a month less mortgage and mortgage insurance, say totalling 550, will leave 741 to cover bills - say electric £40, water £30, gas £30, council tax £100, car insurance £25, car tax say £15, phone bill £25 - that will leave less than £110 a week to feed a family of 4 (assuming they have no car repair bills, no tv at all, no broadband....).
Suggest you sit on your property for another few years - if this bloke is worth his salt he'll earn more money until he can afford the mortgage.
Don't forget, you will be giving them £115-£75k = £40k over what you could otherwise make, and not only that, they will benefit from the gain in house value, so in 10 years it could be equal to giving them £100k that could otherwise go to your retirement fund!!! And don't forget, that's your inheritance they would be "robbing" from your other children - and restricting your options for the future.
(as an aside, they should be grateful you are giving them a house to rent at the cost of the mortgage, they won't get a deal like that elsewhere)
2007-09-03 02:44:15 · answer #2 · answered by Paul M 5 · 1⤊ 0⤋
Let's get one thing straight - its YOUR house. Consult your wife, and decide together. I think that sticking with your 95K is the least you should do, as essentially you are diddling yourself out of money. Also, other step children may see this as favouritism. Essentially, they wouldn't be in this position if you hadn't bought the house in the first place, and you have had the good grace to let them live with you (plus two children) for 7 years.
Your other option, is, of course to sell the house at valued price (often fetching high above that) and give them a cut of the profit. E.G - Say you will take 100k, and anything over and above that, they can have as a deposit towards their own home.
2007-09-03 02:34:02 · answer #3 · answered by Gem Gem 5 · 1⤊ 0⤋
You have to get your head out of this family thing. At the end of the day you own the house and they have been renting it from you. The fact that the money covered the mortgage is irrelevant. It is purely a business venture.
I would approach them and tell them the value of the house ( get this professional assessed and ask them if they would like to buy it. You are under no obligation to give it to them any cheaper otherwise you would have to re-imburse the rest of the family for the same amount. It's always difficult where family are involved but you have to remove this from the equasion. It is ultimately their choice if they decide to purchased your house or not. Because they are family it would be wrong not to give them first refusal but after that they are on their own. Good luck
2007-09-03 04:18:10 · answer #4 · answered by sal-your pal 4 · 0⤊ 0⤋
Do not sell the house under the asking price.
The problem is if you sell the house for much less than it is worth then you may naturally become resentful in the future.
Remember there are lots of mortgage lender services available. You would be surprised how much finance some lenders will allow people to borrow.
If they really want the house, they will come up with the money. Do not be fooled.
2007-09-03 08:33:15 · answer #5 · answered by Wisdom 2 · 0⤊ 0⤋
I feel your price is reasonable given the actual value of your property. The seven years rent should not effect your decision as am sure you paid for the upkeep of the property, maintenance etc. The mortgage issue between your step daughter and lender don't get influenced even family want a cheap deal.
2007-09-03 05:29:19 · answer #6 · answered by STEPHEN H 1 · 0⤊ 0⤋
Sell it to them for $75k. The money should not even be an issue for you, and I understand about the other children. You will have other opportunities to help them out as well, each child's needs are different.
2007-09-03 02:52:28 · answer #7 · answered by In His Steps 1 · 0⤊ 0⤋
Really the party that has been renting the house should have first option to buy since they have invested money and time into the home. It's your home and your decision. If there weren't family involved would you still consult them regarding the sale?
2007-09-03 07:17:12 · answer #8 · answered by Coop's Wife 5 · 0⤊ 0⤋
Very thoughtful, but as you stated there are other kids involved and one of their noses may be put out of joint if you do not consult with them to get their thoughts. That said though perhaps if you do sell to the one that is living there you can give all the others a couple of grand each just to let them know they are getting something also. It truly is a moral dilemma and I wish you best of luck in resolving it.
2007-09-03 02:39:13 · answer #9 · answered by crazylegs 7 · 0⤊ 0⤋
That is a money question. Surely you can make a discount, because they are not strangers for you. But it would be unfair of them to claim for any discount from you, as there is a market price. So I'd agree with the advise to let them pay the rest during some period of time.
2007-09-03 02:45:30 · answer #10 · answered by Ekaterina E 2 · 0⤊ 0⤋