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Clare
Clare, Solicitor
Category: Law
Satisfied Customers: 33325
Experience:  I have been a solicitor in High Street Practice since 1985 with a wide general experience.
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I am a joint owner of a property that is let out. I own a fifth

Customer Question

I am a joint owner of a property that is let out. I own a fifth and my brother-in-law & wife own the 4/5ths. I want to find out what my options are to get out of the situation as we are not agreeing how to run the place. They don't seem willing to buy me out unless I can find a solution they love and they are scaring me saying no outsider would be interested. I am a pensioner with health issues and would like to try to avoid a greater rift or better still find a solution where we get on better.
Submitted: 1 year ago.
Category: Law
Customer: replied 1 year ago.
Am wondering whether this is a legal as well as an estate agent question? The place has not had a valuation done since 2006 which was probate value on the death of my husband. Last two years they have ploughed a ridiculous volume of money into the place without valuing it beforehand to know what budget would be sensible. My request was ignored. They have also not valued it since the main renovation projects were complete. There are other issues which frighten me what the consequences could be.
Customer: replied 1 year ago.
Am wondering whether this is a legal as well as an estate agent question? The place has not had a valuation done since 2006 which was probate value on the death of my husband. Last two years they have ploughed a large volume of money into the place without valuing it beforehand to know what budget would be sensible. My request was ignored. They have also not valued it since the main renovation projects were complete. There are other issues which frighten me what the consequences could be.
Customer: replied 1 year ago.
What documents determine that a property is residential rather than business when it is occupied by a tenant?I know the risks of not having a deposit in a scheme, but if other co-owners refuse to get one set up, is there anything I can do even though tenants have been in there for over a year? Embarrassing I grant you to ask now but???If the tenant's husband (not sure if he is listed as a tenant) has made the house the registered business address for his company, what are the risks? Should he have asked permission to us? Should we have declared it to our insurance company?Do any of these questions above make the insurance null & void if something happens?An account was finally set up a year or two ago for the property rather than the income & outgoings go through the co-owners account. Should I be entitled to have online access etc to it or should I just be satisfied with asking them every few months if they could kindly send me an update. Would be nice if I didn't have to wait until I ask of course but can't seem to get it done automatically as I don't know my rights.
Customer: replied 1 year ago.
The property is more than 6 hours travel from me so the other co-owners are my eyes.
Customer: replied 1 year ago.
The other co-owners have been withdrawing a regular income for a year now whereas I am nervous to decide what I would be entitled to withdraw to ensure there is enough money in the account and that we are paying the right amount of tax.
I put in a fifth share of money for a lot of the renovation bills subject to me receiving the invoices or receipts. I did not pay all of the bills because either I felt I had given enough money and so therefore it could be taken out of the rental income or because I have yet to receive/see evidence of the expenditure.
I don't understand whether I should withdraw money to replenish the personal income I contributed per payment or whether I just take out the fifth of the rental income monthly or periodically. I don't quite understand how to know from when to backdate to for requesting a withdrawal. I have been paying tax as if I have received the income even though I have not.
Expert:  Clare replied 1 year ago.
HiThank you for your questionMy name is ***** ***** shall do my best to help you but I need some further information firstHow much is the property worth and is there a mortgage involved?What agreement was made about how a sale should be triggered when the property was purchased
Customer: replied 1 year ago.
Hi Clare
The property was worth £250,000 in 2006 but was very dilapidated by the time long term tenant moved out in 2012. About £56,000 of renovations and materials (including new roof, kitchen and central heating etc) were put into the property between 2012 and Apr 2015.
No idea what it's worth now.
It was inherited by my husband and his two brothers, but one brother stepped out of the ownership straightaway and handed his 2/5ths share to the youngest brother. My husband's Mother died in the 80s.
Not sure if that answers your last question or if there would be a phrase I should be looking for in some documentation?
Last year my brother-in-law updated the ownership documents to include his wife in his 4/5ths share.
Expert:  Clare replied 1 year ago.
Would you prefer that the house is sold?
Customer: replied 1 year ago.
I have tried to do what I felt right about keeping it in the family but I think the best at least for me is for me to get out of the ownership. I had hoped they would consider getting one or both of their two children to buy my share but they rejected that idea.
They made an offer to buy it back in 2007 but it was so low I rejected it and at the time thought I was doing right keeping it for my husband's sake.
I can't imagine with only my one fifth share that I could enforce the whole house to be sold?
Expert:  Clare replied 1 year ago.
In fact you can - any property owned by more than one person is owned on a "trust for sale" and any of the owners can apply to the court for an Order for sale at any time - and it will be granted.I would suggest that you send a formal letter to each of the other owners offering them the chance to purchase your share at the current market price - and stating that if they do not do so you will apply to the court for an Order for sale - and for them to pay costs.If they do not make a reasonable offer - then make the court applictaionI hope that this is of assistance - please ask if you need further details
Customer: replied 1 year ago.
It's good to know I can do this but I'm still hoping to find a solution without causing a family rift, so is it feasible to just sell my share to an external party or this more a question for an estate agent?
We will be seeing them coincidentally next week so I would like to have myself preapred with what all the options are and how to deal with the other issues I listed above to make sure when I raise them I am confident about the legal or cost and risk implications.
Customer: replied 1 year ago.
For instance as I happen to be in the area next week should I arrange for estate agents or surveyor to value the property? It is occupied by tenants so I assume I need to ask my relative to give them notice of our intentions to value the property. For my relative I'd like my reasons to be justified. The property was not valued after the last 1970s act tenant vacated and before renovations started. If we value it now then can we ask them to guestimate what the value would have been before the work was done?
Do we just ask an estate agent for a sale value (ask more than one) or should we use a surveyor and pay? Not sure what the difference is other than having to pay and which one would be most appropriate in this situation of co-ownerships, possibly partial sell or for inheritence tax purposes of the value of property before & after renovations?
Customer: replied 1 year ago.
For instance as I happen to be in the area next week should I arrange for estate agents or surveyor to value the property? It is occupied by tenants so I assume I need to ask my relative to give them notice of our intentions to value the property. For my relative I'd like my reasons to be justified. The property was not valued after the last 1970s act tenant vacated and before renovations started. If we value it now then can we ask them to guestimate what the value would have been before the work was done?
Do we just ask an estate agent for a sale value (ask more than one) or should we use a surveyor and pay? Not sure what the difference is other than having to pay and which one would be most appropriate in this situation of co-ownerships, possibly partial sell or for inheritance tax purposes of the value of property before & after renovations?
Expert:  Clare replied 1 year ago.
It would be wise to ask an Estate Agent to value the property, and to also ask the Agent to assess the extra value to the property attributable to the renovations.Be firm with your relatives and say that this has to be dealt with and you would prefer to do it on a cordial basis.You should also ask for a site of the accounts relating to income and expenditure of the property.
Customer: replied 1 year ago.
If we request a valuation but my brother-in-law refuses to give me the key or the tenant doesn't let me in, can I proceed? I might be too nervous to go against his will, so I just need to know even if I choose to back down whether I'm within my rights to do this.
There were lots of other questions I asked in the dialogue above because I don't think I would be so brave or so lucky to be able to persuade them without force which I would love to avoid if possible. Should I ask those questions individually again so I feel more prepared to approach my fellow co-owners?
Expert:  Clare replied 1 year ago.
You are within your rights to ask for this.If they refuse fair enough - you will just have to arrange it in a more formal basis on the future
Customer: replied 1 year ago.
The problem is we feel they know all the estate agents in the area and so not sure what will happen if we're not present.
So the other question I asked - should I make them as new questions below?
Expert:  Clare replied 1 year ago.
If you number the questions I shall try and deal with them
Customer: replied 1 year ago.
1. What documents determine that a property is residential rather than business when it is occupied by a tenant?I know the risks of not having a deposit in a scheme, but if other co-owners refuse to get one set up, is there anything I can do even though tenants have been in there for over a year? Embarrassing I grant you to ask now but???If the tenant's husband (not sure if he is listed as a tenant) has made the house the registered business address for his company, what are the risks? Should he have asked permission to us? Should we have declared it to our insurance company?Do any of these questions above make the insurance null & void if something happens?
Expert:  Clare replied 1 year ago.
1. This is a matter of fact - is there someone living there or not2. The lack of deposit protection could make eviction problematical but there is no need for you to take any action yourself3. The fact that it is a Business address is not a problem for you or you insurance
Customer: replied 1 year ago.
1. There is someone living there since 2013/14. I have never seen the tenancy agreement though I am assured there is one despite asking for it. Wasn't sure if it was deposit scheme that determined it as a residential address or if the tenancy agreement determines that it is seen as a residential address. Knowing that the tenant's husband has registered his company at this address makes me wonder what the risks are e.g. insurance or other?
2. So if the tenants decide to take the landlord's to court for some reason would I not be held responsible for paying out the fine as well as my siblings-in-law as a landlord or would I be able to argue that I tried on several occasions to persuade the other co-owners to take a deposit?
Customer: replied 1 year ago.
4. An account was finally set up a year or two ago for the property rather than the income & outgoings going through the other co-owner's personal account. Should I be entitled to have online access etc to it or should I just be satisfied with asking them every few months if they could kindly send me an update? I don't think the account has my name on it. It would be nice if I didn't have to wait until I ask of course but can't seem to get it done automatically as I don't know my rights.
Customer: replied 1 year ago.
4. An account was finally set up a year or two ago for the property rather than the income & outgoings going through the other co-owner's personal account. Should I be entitled to have online access etc to it or should I just be satisfied with asking them every few months if they could kindly send me an update? I don't think the account has my name on it. It would be nice if I didn't have to wait until I ask of course, but can't seem to get it done automatically as I don't know my rights.
Customer: replied 1 year ago.
5. 05/10/2015 08:26
The other co-owners have been withdrawing a regular income for a year now whereas I am nervous about deciding what I would be entitled to withdraw to ensure there is enough money left in the account and that we are paying the right amount of tax.
I put in a fifth share of money for a lot of the renovation bills subject to me receiving the invoices or receipts. I did not pay all of the bills because either I felt I had given enough money and so therefore it could be taken out of the rental income or because I have yet to receive/see evidence of the expenditure.
I don't understand whether I should withdraw money to replenish the personal income I contributed per payment or whether I just take out the fifth of the rental income monthly or periodically. I don't quite understand how to know from when to backdate to for requesting a withdrawal. I have been paying tax as if I have received the income even though I have not.
Customer: replied 1 year ago.
2. Eviction is unlikely as the tenant is an indirect relative of the co-owners which is why they didn't feel right about asking for a deposit as the tenants moved in before the works were completed.
Customer: replied 1 year ago.
If we can't get access to the property, does it make sense to still invite the estate agent to make an estimated value from the outside of the premises? I have a narrow window of opportunity to be there to get a valuation done.
Expert:  Clare replied 1 year ago.
1 and 3 There is no particular risk with him using it as his Business address2. It would be a claim on the income form the letting first - and certainly you will be able to force the other owners to pay your share However if no deposit was paid then it is a moot point anyway4. All you should expect to receive are the annual accounts for the letting -5. You are entitled to a fifth of the income and there is no reason not to take it - in whatever way you prefer. You are entitled to see evidence of expenditure before paying the bills. 6. A Drive by valuation may be useful - you need only have it valued as of todays date since you have pr intend to pay towards the renovations
Customer: replied 1 year ago.
4. How is it that I'm not entitled to ask to view the accounts more than once a year?
5. So should I just take it as a fifth of the income as withdrawals or better to retrieve the value of money I put in to help the improvements/repairs of my own money - or do I only retrieve that tax wise when the property gets sold or my share?
6. Please clarify? Not understanding "pr". Renovations/improvements were done in 2012-14.
Customer: replied 1 year ago.
7. Would there be any benefit to me handing over my share or selling it to my daughter? This would take me out of the equation. I suspect my daughter wouldn't thank me for it but she may be able to be more determined to get us out of this situation?
Expert:  Clare replied 1 year ago.
4. Because accounts are generally drawn up once a year5. You should take your fifth of the net income6 That should be "or"7 With respect the easy answer is to force the sale - it will be sorted within 6 months
Customer: replied 1 year ago.
Have tried to arrange for three to four viewings this week. The co-owners have refused on behalf of the tenants anymore than one estate agent saying there is no purpose in getting a valuation let alone getting three. They are also stating that if I am wanting to do a proper valuation I would have to pay for a surveyor to do it at my expense.
Expert:  Clare replied 1 year ago.
One valuation will do for now - it will give you a value to work with
Customer: replied 1 year ago.
I have also discovered that they have had three windows replaced without my consent this month. As a co-owner must I be prepared to a pay a fifth of every expense even if I don't agree to it? I also suspect they are not FENSA registered. Will I find this a problem?
Expert:  Clare replied 1 year ago.
You are entitled to insist on seeing the FENSA certificate before paying
Customer: replied 1 year ago.
I suspect there won't be one to see. What kind of rights do I have to refuse to pay for works done when I'm a co-owner. We had the method before of them sending invoices or receipts after works done even if I wasn't informed that the furnishings were being bought or the works done in advance.
Now there's works being done and they will automatically deduct the payments.
So what rights do I have to refuse to pay for certain things that they decide should be paid for. There is for instance some outgoings from May 2014 which they cannot justify to me. There are others prior to that which I let go of and accepted to pay. But I don't want to keep feeding this bottomless pit. They have full control of the monies in the account.
Expert:  Clare replied 1 year ago.
They have to justify any expenditure to you and you will have to approve the annual accounts - if they cannot show that the work was done properly then they cannot deduct it from your share
Customer: replied 1 year ago.
Helpful to know. We have never been asked to approve the accounts.they just give us the bank statements occasionally. For instance there are two transactions in May 2014 that they have not produced paperwork or expenditure for despite numerous requests. I'm assuming they will deduct that automatically and I didn't know whether I could refuse to pay it when they are the ones holding the accounts
Expert:  Clare replied 1 year ago.
Of course you can refuse to pay if the accounts do not show why payment is due
Customer: replied 1 year ago.
They are adamant that they have given adequate explanation but good to know I can refuse to pay. House valued yesterday. Agent says unlikely to get public interest in our share.
Would a rics surveyor give rebuild value and then I work out from that what figure I would agree to sell for? Still wondering what proposals I could come up with to be bought out that would keep this amicable?
Expert:  Clare replied 1 year ago.
Hi
You are not selling your share on the open market
You are either selling your share to the others for one fifth of the sale price O R the whole property will be sold
Clare
Customer: replied 1 year ago.
Okay but is there any other way of making my share look attractive in a way they don't have to pay me in a lump sum or would it be possible to offer it to the tenant for instance but they still pay rent?
Do I need to consider getting a RICSSURVEYOR to do a valuation that would make it feel more affordable for them? They will be convinced that I shouldn't ask for the sale price if in selling internally. I'm trying to think of an attractive proposal that feels fair for all. Expecting impossible I imagine but worry that if I don't think of less harsh solutions I will bottle it or we'll reach stalemate
Expert:  Clare replied 1 year ago.
You do not need to do any of thisThe law is simpleThey need to purchase your share of the property at the current market value or the property has to be sold.There are four of them and they are only having to purchase a one fifth share between them.It is a property which is making them moneyIf they are strapped for cash they can can get a small and cheap buy to let mortgage.Alternatively they could offer you instalment payments over sat a five year term.If you are worried you will give in then only deal in writingClare

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