All Forum Posts by: Mike Ash

Thanks, everyone. This is the house my daughter grew up in. Lots of memories-- and even more so since this is the home my wife (her mom) lived and died in. She and my late-wife frequently talked about her (my daughter) buying (or renting-to-own) this house when we (planned) to move to a smaller Patio home. (Again, that was back when the house would have sold for 1/2 what it would sell for now).

@Colleen F., you wrote: "If you rent it you start depreciation and that will impact your taxes if you do sell eventually because it has become a rental."

Am I understanding correctly that if I rent the house (to my daughter or anyone), the house will depreciate?

My future wife's house is worth double what my house is currently worth. If we both sell and buy a smaller house (and split the cost), we could buy a new house and have some left over for retirement. My current house value would cover 1/2 of a new house, but I wouldn't have anything left over-- she would.

Using rough figure: My house $300k (was worth $189k when my late-wife/daughter talked about her buying the place). My future-wife's house, $600k. A new house, $500+k. 

If she sold her house, bought a new house (and kept it all in her name & survivor benefits for her kids), she'd still have a little left over, but obviously not as much--- so I thought a rental income could provide the extra retirement income we'd like to have. If we both sold our houses, we'd have a new house & maybe $200-$300 (after fees, etc.). I realize this is likely the better financial option than getting a monthly rental income (but maybe someone here can tell me if I'm wrong).

The problem, of course, is this means kicking my daughter, son-in-law, & grandson out of the family home they have planned to live in until they grow old (and I know that plans can obviously change). Based on the current rental/home market prices compared to when they moved in & started paying rent, they are going to be in for a drastic change in lifestyle because prices, where we live, have skyrocketed & some young families (even in my neighborhood) are living with other young families & splitting the cost of homes.

When my wife died, my daughter was my rock. Dinner every night when I came home from work. Someone to talk to. She ran errands for me, & took care of the house. I never thought I'd meet someone again after losing my love. I thought I'd be there forever & my daughter would help take care of me in my old age. I even upgraded some things in the house because I figured this is where I would die, and my daughter & her family would be by my side to help me in my old age. 

Suddenly that changed when I found a new love (and wasn't looking for love). When I first began to get serious with the lady I'm with now (long before we talked about marriage), my 12-year-old grandson approached my daughter & asked, "Is grandpa going to kick us out of the house?" When my daughter told me this, I replied, "Of course not" (never thinking far enough in the future that if we decided to get married, something would change in our living conditions. Now I'm faced with that very scenario. It's heartbreaking to kick her out, but I want my future wife to be the most important person in my life. I was hoping I could find a solution that works for everyone.

Thanks for the input, sincerely.

@Bill Brandt
2) you say she can’t afford it but she’ll buy it from you?

Me: When my late wife & I talked to my daughter about them buying the house from us, the cost would have been 1/2 of what it's worth today. They've been paying rent in kind of a quasi-- rent to own our house someday plan. Now the house (if I sell it) is worth double.

@Bill Brandt
4) anything short of you paying half for the new house and ongoing expenses is you asking her to subsidize your kids that I assume are adults.

My future wife's current house is paid for. I could move into her current house & the house is still in her name. I wouldn't need to pay 1/2 of any new house (and neither would she). The reason we'd move is that her current house is bigger than we would need &  is worth much more than a house we would get. I'd be fine with her keeping a new house in her name if I continued to rent to my kids. When my house is paid off (very soon), all the rent coming from my daughter would be retirement income for me and my future wife. I would certainly plan to be paying 1/2 of all ongoing expenses in a new house-- taxes, upkeep, utilities, etc. I just thought that maybe keeping my house & collecting rent would be a great way to have a steady stream of ongoing income & still allow my daughter to continue renting (and hopefully someday owning) my house. If, in the future, my daughter decided to move out of my house, I could rent to someone else or sell.

@Bill Brandt
5) imagine it the other way around. She asks you to sell your house and buy a house to share with her, while she gives her house to her kids.

Me: I get your point, but I wouldn't be giving it to my kids, I'd be renting it for income for my new wife & I. My future wife would own the new house and if, God forbid, something happened to either one of us (she could will it to her kids) or if, God forbid, the marriage didn't last (she could include that in a prenup).

Quite frankly, it's all a bit confusing & stressful to figure out because I was married for 38 years to the same woman, thought I knew what my future plans were, thought my late wife & I were going to sell our house to my daughter (before prices skyrocketed) & we were going to get a Patio home. That all changed in the blink of an eye. Now (nearly 3 years later), I'm in love again and want to move forward but also worry about pulling the rug out from under my daughter, who thought she knew what her future held (and I thought the rental property on a paid-for house, might be a great solution to have a retirement income).

I realize that there are emotions involved & that's why I'm seeking advice, so I'm not trying to be argumentative and would appreciate any additional input you might offer considering the possible clarifications above. I need someone from outside of the situation to provide some input so I can ultimately make the right decision. Thanks.

Thanks Theresa. The problem is that until very recently, it was foregone conclusion that my daughter would be acquiring my house sooner or later (purchasing or rent to own from me & my late wife, then just me after I became a widower), but now that's changed with me planning to remarry. So my daughter loses her mom & now the house that was kind of promised to her-- because she can't afford to buy my house & I can't afford to come up with 1/2 of a new house unless I sell my house to someone else & kick my daughter out. My only option (that I can see) is to rent, or do some sort of home equity loan that my daughter pays through rent (or maybe someone here has other options). I'm in a pickle because I love my bride-to-be but also my daughter, son-in-law & grandson who I would send out into apartment living after they had been told for 4 years they would eventually get my house.

To summarize a long story: Daughter & her fam moved back home (with wife & I) in 2019 after son-in-law laid off. Covid hit in 2020 & he got back to work in late-mid 2020. My wife talked about selling or renting them our house so we could get a smaller home. Near the end of 2020 my wife died suddenly. Kids kept me company & daughter cooked for me, etc., while we all lived in my house. It was a blessing to have them in my house. 2023: I've met someone else. She's also a widow with a paid off house (my house will be paid off in just over a year). She wants both of us to sell & get our own smaller place. My house is now worth double what it was when the kids moved in & wanted to buy my house. My new future bride wants me to sell so we split the cost of a new place (although selling her house would more than cover the cost of a place for us-- but she wants to make it fair that we both pay 1/2 of a new place & then keep the extra $ for travel, etc.).

I can't kick my kids out-- my late wife kind of promised them our house & rent is now more than house payments (& my kids have bad credit & wouldn't be able to buy my house even if they could afford the mortgage payment). I'm not putting my kids out on the street after the house has become virtually theirs while they lived with me and my late wife & were there for me, taking care of me, when I became a widower. I need to convince my wife-to-be that renting my house to the kids would work & we'd get a monthly income when there is no more debt on my house.

My questions: What advantages do I gain from renting instead of selling? Once the title is mine, are there advantages/disadvantages to taking a home equity loan for travel etc. & let the kids rent payment cover the loan payment, or is it better to just save up the rental payments? I need to figure out how to let me kids live in my house, charge a rent they can afford (which is less than the mortgage would be), but still come out with advantages to make this work for a new life with my future wife-to-be.

I'm in serious need of advice.