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Buying house from family member.

  • 10-02-2015 4:47pm
    #1
    khaki
    Registered Users, Registered Users 2 Posts: 23 ✭


    My partners mother and auntie inherited a house last year. It was uninhabitable so we asked them if we could completely renovate it and then either buy it or we would get our money back from the sale of we weren't in a position to buy.
    The house was valued at 45k last year.
    Since then it's been rewired, replumbed, insulated, plastered, floored, etc...
    We have just been approved for a mortgage and I'm curious how much we will have to pay for the house - will it have to be independently revalued or would they be allowed to have the final say on the price?
    Eg: if the house is revalued at 75k and they decide to knock off 15k for the money and work that we've put into in, will we be allowed to buy it at 60k ??


Comments

  • #2
    Eldarion
    Registered Users, Registered Users 2 Posts: 484 ✭✭Eldarion


    khaki wrote: »
    My partners mother and auntie inherited a house last year. It was uninhabitable so we asked them if we could completely renovate it and then either buy it or we would get our money back from the sale of we weren't in a position to buy.
    The house was valued at 45k last year.
    Since then it's been rewired, replumbed, insulated, plastered, floored, etc...
    We have just been approved for a mortgage and I'm curious how much we will have to pay for the house - will it have to be independently revalued or would they be allowed to have the final say on the price?
    Eg: if the house is revalued at 75k and they decide to knock off 15k for the money and work that we've put into in, will we be allowed to buy it at 60k ??

    They can sell at whatever price they want and you can buy at whatever price you want. However you may be liable for Capital Acquisitions Tax for the difference between the value of the property and the price at which you buy at.

    I'm fairly sure this could be negated with the CAT Thresholds as it's your partner's mother "gifting" the difference. I'm not sure how this plays for YOU as you have no direct relationship with the sellers though.

    The CAT Threshold from the mother to your partner is €225k and from the Aunt to your partner is €30k. I'm sure you'll be well under both if the equity is split 50:50.


  • #3
    wowy
    Registered Users, Registered Users 2 Posts: 709 ✭✭✭wowy


    Don't forget that the mother and the aunt will also be liable for CGT on the uplift in value, which should also be considered when agreeing a value (if you're not getting an independent market valuation).


  • #4
    khaki
    Registered Users, Registered Users 2 Posts: 23 ✭khaki


    Thanks so much for the info!


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