Housing Association rental or Buy to let?

Housing Association rental or Buy to let?

9:38 AM, 29th July 2016, About 8 years ago 1

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M&B own a 4 bedroom semi detached property with a mortgage. Both were born in 1957. They have 2 children.Possible scenarios

Daughter A was born in 1985 and has an acquired disability through viral encephalitis (herpes simplex) at the age of 3. A now has severe epilepsy, severe learning difficulties and right sided hemiplegia. A currently lives in a 24/7 supported tenancy, on a 1 to 1 support basis, within 2 miles of parents. A lives with two other occupiers who also have special needs. This tenancy is owned by a specialist Housing Association and 24/7 care is provided by a specialist care provider.

Son R was born in 1987 and currently works in city centre and lives in the inner city as a sub tenant of a friend known through a sports team. R intends to move to father’s home country within the next 2 years. Length of move unknown.

M&B are looking to downsize their living accommodation which has been adapted for their daughter. This is by way of a stairlift from the ground floor to the upper floor and the fourth bedroom has been converted to a wetroom. Additionally, M used to work from home as a Beauty Therapist in the lower floor which is fully tanked and secure.

Possible scenarios

1 sell the property on the open market and pay off the mortgage and credit card/loan obligations. Then either purchase another smaller property or rent on the open market.
2. rent on the open market – likely rental £12,000 per annum (£1k pm) – with the permission of the mortgagor. Then either purchase another smaller property or rent on the open market.
3. rent the property to a specialist Housing Association to accommodate occupiers with special needs – likely rental £20,000 per annum based on housing benefit income of occupiers – with the permission of the mortgagor but only for the remainder of the mortgage term – approx 2021. Then either purchase another smaller property or rent on the open market.


Is it possible/appropriate to set up a Family Trust – long term beneficiaries A & R – to purchase the family home on a buy to let basis and to offer the Housing Association a long term lease (up to 80 years) generating income to benefit the parents during their lifetime and ultimately the two adult children

Would it also be possible for the same family trust to purchase a property now for the parents to live in. This would be on a normal mortgage arrangement being paid from the excess funds from the former family home rental.

Updated Wills for all 4 family members to reflect final solution.


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Neil Patterson

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9:43 AM, 29th July 2016, About 8 years ago

It is great to get ideas from people, but at some point M&B need to give ALL their personal details and circumstances to a fully qualified and regulated Estate Planning IFA and Solicitor.

Please remember with your possible scenarios that consent to let from the existing lender, if it is given, will normally only be for a maximum of 2 years. As the circumstances are a permanent change the lender may require a change to their BTL product or remortgage to another lender.

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