Advice - buying home with parents?

[bakin'fool]

I'm hoping for some advice/ words of wisdom :) Dh and I are thinking of buying a house with my parents. We would live upstairs, and turn the lower level into a full seperate suite for them. They're thrilled with the idea (more security for them, easier to travel, closer to grandbaby) and it would mean we'd be able to buy a house. We're currently in a condo, and we would be able to get into a townhouse in a few years, but houses are very far out of reach here, so the idea of having a house, garden, garage etc is very inticing. I also like the idea of being close to my parents as they get older and need more help. But, and there's always a but, I know that there are probably loads of considerations to take into account before diving into this, so any thoughts or experiences, good or bad, you've had with such arrangements, I'd love to hear!

TIA,
Nikki

[funnybone]

I think it's a great idea, on paper, if you and your parents can live together. Not knowing your finances and theirs, the legal side of things would really have to be made clear - who pays for the mortgage, taxes, improvements, etc., or how do you split it (50/50 or other). Are all your names on the deed, or just yours/your DH and you rent out the other space to your parents, or vice versa? What happens if one side can no longer afford the payments, etc? Are there other siblings that may want a stake in the property if something should happen to your parents? I'm sure there are other issues, but these are the first things that popped into my head.

[bakin'fool]

Legally, the house would be owned 50/50 - my parents would buy their half outright, and we'd take the morgage on the remainder. Any major repairs to the house or yard would be split (eg new roof, hot water tank, fence) but alterations, repairs to the interior would be independant. All of this would definately have to be put in writing to save later headaches. This is exactly the type of issues I want to fully discuss before we go any further - keep them coming! I know things will come after we buy (if we get to that) but I'd like to head off as much as possible :)

Nikki

[KimK]

You should also fully discuss things like.....will your new "neighbors" be able to regularly show up at your door unannounced and vice versa. You know, kinda like on Everyone Loves Raymond. Sounds like you have a good relationship to consider a move like this, but you'll want to consider these "interpersonal" items as well as the financial and legal issues.

[funniegrrl]

What if something on THEIR floor needed to be improved/repaired but not on yours, or vice versa?

For me, even more important issues would be, "Could I actually live in the same building as my parents?" No matter how much love there is, how well you get along, actually LIVING with your parents is a huge issue. Also, I would make sure your spouse is 1000% happy with the idea of living with the in-laws. Even though you'll have separate apartments, so to speak, you will be very aware of each others' comings and goings, noises of daily living, etc. Not to say it can't work or that it's not a lovely idea, but it is something that I would find very hard to do.

[blazedog]

I grew up with my grandmother (mother's mother) living downstairs in a separate unit and it was a great arrangement for the whole family.

My mother worked during my entire childhood -- starting right after infancy and so I was to some extent raised by my grandmother. During elementary school, she was the one to braid my hair and walk me to school. Since it was around the corner, I would walk home for lunch and I would eat with her -- and of course she was home in the afternoon and was the one who would take care of me when I was home sick.

I had a very special relationship with her because of this.

That said, my grandmother and parents got along very well and my grandmother never intruded -- although it wasn't as if she needed a special invitation, it was generally my nuclear family in the evenings at dinner and afterwards unless she had come up to "visit" or specifically eat dinner for some reason.

Of course she was there for me in a special way since grandmothers are by and large more doting than parents -- She even hid my pot stash once by pretending that she didn't know where a box I had received as a gift was -- she then handed it to me with an innocent air and said she wasn't sure I would have wanted my mother to look at it.:D

It was excellent for my parents since my mother was able to work without worrying at all about day care.

It was obviously a great thing for her as she grew more infirm since it enabled her to remain independent until her death.

Since my parents owned the house entirely, there weren't any legal issues -- but I would think if you are having the house owned 50/50 it would be VERY important to get those on paper -- especially in terms of inheritance and taxes. You should all go to a good attorney together to make sure that everyone is clear as to how situations are to be handled.

[cminmd]

I think it can be a great situation. My husband grew up with his grandmother living in their home. She had her own studio connected by a breezeway to their house. It was one story, kind of like a large studio with a kitchenette and table. She would come over for dinner, but the boys went to her place for toast and milkshakes on the weekends.

One potential problem- siblings. Are their any other kids who might get annoyed that you get a house and they don't?

I think it is very smart to get a new house and design it so it is two first rate dwellings, not one group squeezing into a makeshift space in someone elses house. That way you can make your parents suite have all the things they will need as they get older. No stair access, rails in the bath, wider doors.

Sorry, just trying to play devils advocate, but here are the potential problems I would address.

Is your husband going to want to live with your parents?
What if you want to move because of a job opportunity?
What if you have kids and the noise and comotion is too much for your parents as they get older? Them being downstairs means more noise.
What if you and your husband seperate? I know you won't, but I would worry about my financial stability resting on someone elses marriage. Maybe the house and initail investment could be from them so in the event of a divorce he would buy out of the house instead of having a claim on it.
What are their expectations as they get older?
What type of care are you expected to provide to your parents?
Are they assuming you will take care of them until death?
What if someone needs a nursing home, who decides when they go in?
What about after the death of the first parent?
Who puts up the initial investments?
Who pays which bills?
I would go to a lawyer and work out all the details ahead of time so nothing is left up to chance later.

Good luck!

[Grace]

Not sure how things are in Canada legally, but I assume it's the same or at least similar. There are a couple ways to hold title on a property. Joint tenency or tenency in the entirety or tenents in common.

You can hold title with one or more other people and each hold a certain percentage (one could hold 25%, the other 75% or four people with 25% each, etc., where if one person dies, their 25% could be bequeathed to whomever they want as part of their assets, and their 25% doesn't automatically go over to the other title holders), or where each person holds 100% (DH and I have a title set up this way - if I go, it's automatically 100% his, if he goes it's 100% mine), and several other options. You would need to speak to a lawyer to make sure you get your title set up correctly. But that's a small issue in terms of ease of a solution.

Other than that I have nothing to add to the discussion. I've never lived with or near my parents as an adult.

[bakin'fool]

You're all giving me lots to think about - thank you!

The more I think on this, building from scratch seems like the best option. Basically we build a duplex or sorts, with two seperate units, so all amenities would be seperate (therefore seperate bills) and we could make sure to put in extra soundproofing. The majority of concerns in this endevor would be ours - my parents are pretty easy going. Dh is ok with the situation as long as he has a garage to 'hide' in (but thats from everyone, not just the in-laws ;) and my parents would under no circumstances have free visitation to our unit or vice versa, which is already understood alround. Definately have to see a lawyer about the best way to handle this. I'll take a copy of all the suggestions to discuss with everyone this weekend.

on a side note, my mom grew up with her grandparents in a suite, and had such a special relationship with them because of it. I would love for my mom and daughter to have that kind of relationship too. Definately a big benefit :)

Nikki

[TKay]

Just to add, my maternal grandmother lived with us when I was growing up and I'm really grateful for it. I no longer have any grandparents living, and it was a true blessing to have spent such time with her. Now, while the situation with us kids was nice, it was a strain on my father. My grandmother was not independent, but needed daily care from my mother. I think my dad resented having her there and it was a strain on him to support another person (he was the sole provider for all six of us kids, my mom and her mother). I would make sure your dh is fully on board wtih all of this and that having your parents around will not impact your marriage in a negative way.
Just my two cents. Good luck!

[rosen]

Be sure to check out the zoning laws on this type of arrangement.

In our area, a home must be a single family dwelling unless there is zoning for multi units. Example: this means that the house in the neighborhood that just added a 2nd full kitchen in the basement for the in-laws is now going to court 'cause they violated a bunch of laws. The neighborhood is only zoned single family & this owner has now created a potential rental unit in his home. The issue isn't so much about his family living w/ him as it is creating a problem for the neighborhood when he goes to sell this property.

[sharhamm]

Being the parents these are the things I would consider:
What if there is a marriage breakup and the house has to be sold? (We all think this is never going to happen, but look at the statistics.
What about privacy and being taken advantage of.... (by both sides)?
What happens if one parent needs to be placed in a long term facility and they need to sell out their share? You may not be in a position to take out a higher mortgage.
Your parents are going to pay for half of the house and you are taking out a mortgage???? What happens if you default on it?
It all sounds like a good plan to you right now, but these are things you both really need to consider.
My advice is to struggle for a couple of more years and get a smaller place you can call your own. Perhaps your parents could move nearby.

[donleyk]

Nikki,

I was in a golf buddy's house that had a rather different design, and very cool to me. It was an L shaped ranch with doors that opened at the short side where her mother lived. Had a kitchen, bathroom, LR and bedroom. Seemed very comfortable. The kitchens were back to back so when my friend entertained she could open the doors and use both kitchens as well as having plenty of room for us all to hang out and chat or help as needed. Just wanted to share, good luck to you.

[Kristilyn1]

I think people have all brought up very valid concerns that you should explore. We were considering buying a vacation property with my parents last year and those were all things we talked about and agreed that everything would be written out ahead of time, not necessarily from a document to be used in court, but to make sure everyone could reference something when issues came up, such as:

1. how long is a default to be tolerated? 1 month? 3? What is the course of action on a default?
2. Who is responsible for what?
3. Improvements or repairs, what is the method to be used to decide what will be done and when? Majority rules?
4. How do you handle if one party wants to sell, for whatever reason?
5. If one party buys out another, what will be the method used to determine the selling price?
6. How do you handle equity? What if one couple breaks up? Who gets the interest in the house and how will the equity be handled then? Does one spouse "have" to buy out the other? How do you determine which spouse gets what in terms of the house?
7. The inheritance issues.
8. Nursing home care. Research the laws to make sure you are all not in danger of losing your home if a parent ends up in a nursing home. I know here in NH, if an adult child has been living in the home for at least two years, the house can't be touched. But does that also extend to a duplex jointly owned? Find out.
9. Usage. Can any party rent out their side? For any amount of time? For any purpose?
10. The yard. If it's shared, at least discuss any rules you might have, such as---parties? A pool? Make sure you are all on the same page in terms of what sort of upkeep you plan on/expect. This will avoid problems such as your dad fuming because you guys only mow once a week and he really wants it mowed twice. What kind of landscaping?
11. Who does what? Mowing, weed whacking, shoveling (if applicable)
12. Who does or pays for common maintenance, such as painting house, termite extermination, having trees cut down if needed, etc.
13. Pets. Talk about what the expectation is for dog cleanup, if anyone has one. Fencing? Is it wanted? If so, where?
14. As everyone mentioned, visitation expectations.

Good luck, I think it's something well worth doing if you can work out all the details.

Kristi

[bakin'fool]

Thank you all for your thoughts and advice - there is definately alot to think about and discuss before going further. I think sharing a home (basically each of us with half of a duplex-type home) will be the best for all of us in the long run, once we get some ground rules in place and all the issues sorted out. It will mostly be a matter of when and how - but all of your suggestions will really help with that. Thank you!

Nikki