Buying your parents a house...

[Miniata]

Originally Posted by ahausheer

Buy it but keep it in your name and have them pay the yearly taxes. That way you are helping them out but in the end you own property that should at least hold its value.

+1

.....but only if it puts zero strain on your own financial situation. It need not be anything terribly nice, even if it was, doesn't sound like they'd be terribly grateful anyways. Good luck with the situation.

[pixel67]

I would treat it like a business transaction. Buy the house, ask that they pay rent, you maintain deductibility and right to sell. My mother passed at 60 so 59 may not be old, but you never know when your time is up. You are young and it's only money. You can and will make a LOT more money but you can't buy time. I personally would do it, but am 20 years your senior and have a different perspective on the value of money and much different circumstances.

[Jeff Lange]

I don't know how I would act/respond to this situation as it just seems so far out there to be relevant to my life, but I would probably see about helping them out a bit, or trying to see what other options were out there.

Perhaps help them rent a different place, or buy a place for them to rent from you for what they can afford. I'm all for helping out family, but it does seem like an odd request.

Jeff

[RRnold]

^ +1


Maybe try the renting an apartment idea for the first year and see how that pans out. That would give you a better idea before making a huge financial commitment.

[Leonardo]

I am fortunate to have awesome parents. My parents have always been there for me. Even when I made a few really bad decisions. I would help them now any way I could.

Some parents don't give their children much training or support. If I was one of those kids, I may not be rushing to help. No judgement. Life is hard.

[Dave-ROR]

Hmm that's a tough one.

My brother, sister and myself do help our parents with some expenses as they are both elderly and on limited income (although my mother still works 30-40 hours a week). My father has major back issues which resulted in him becoming disabled from a work perspective so he's retired but always looking for temp/seasonal stuff to help make ends meet (tax stuff mostly, he's a CPA).

They have never asked us to buy them anything major although I have bought my Father a car and plan on buying a car for my Mother next year. Part of that is to eliminate having to fix their older cars, which started to take up a bit of my time.

A house is a major purchase though, I don't believe I'd help with that, nor would I be in the position to without eliminating things in my life that I love doing.

Part of the reason I'm willing to help out is that the only bad financial decision my parents made was my father having too much pride to make us change our lifestyle when he was laid off. We never realized that he used his savings up hoping that things would improve afterwards until it was too late. That decision, while not wise in the end, is at least partly responsible for me being where I am in life now.

IMO I agree with the others, help them with an apartment or other lower cost solution instead of buying a house and see how they handle it. After that you can decide if the business transaction of you buying an investment property (the only way you should look at it IMO) is worth it or not.

[M-17]

Originally Posted by ahausheer

Buy it but keep it in your name and have them pay the yearly taxes. That way you are helping them out but in the end you own property that should at least hold its value.

That's what I would do. That seems like the most logical way to go about this imo.

[Dadhawk]

My wife and I gave this considerable thought when we were in our early 30's because I was convinced I would end up supporting my parents. Here is what we planned, and I still think it is sound.

First, do not overextend yourself. All of you in a 2 bedroom townhouse is better than all of you living in your FR-S on the street. If you have to take out a loan, all of your real estate loans should not add up to more than 25% to 35% of your annual income.

Be ready for an emergency. You can lose your job/business. When you do, you'll need to be able to make both mortgages.

If the area where they want to live is too expensive, they live somewhere else. That's just the facts of life. I don't live on the Beach because I can't afford it. They don't live in a neighborhood with $500K townhomes if all you can afford is $1000 a month.

Consider paying for a rental first and foremost if you do not want to be a landlord (free or paid). Things will break and they will expect you to fix it.

If you do buy, keep the property in your name and retain ownership of it.

Require them to contribute, but do not expect them to pay any of the associated costs, even though they may truly want to. If they can, great, but don't count on it. If they do give you money use it to pay down the mortgage or put it in the bank for their next financial emergency (there will be one)

If you can get it, you should have enough life insurance (term) to pay off the property when one of them passes.

Just my thoughts. Best of luck to you, its a tough situation and I feel your pain.

[Sparkplug]

Originally Posted by Dadhawk

My wife and I gave this considerable thought when we were in our early 30's because I was convinced I would end up supporting my parents. Here is what we planned, and I still think it is sound.

First, do not overextend yourself. All of you in a 2 bedroom townhouse is better than all of you living in your FR-S on the street. If you have to take out a loan, all of your real estate loans should not add up to more than 25% to 35% of your annual income.

Be ready for an emergency. You can lose your job/business. When you do, you'll need to be able to make both mortgages.

If the area where they want to live is too expensive, they live somewhere else. That's just the facts of life. I don't live on the Beach because I can't afford it. They don't live in a neighborhood with $500K townhomes if all you can afford is $1000 a month.

Consider paying for a rental first and foremost if you do not want to be a landlord (free or paid). Things will break and they will expect you to fix it.

If you do buy, keep the property in your name and retain ownership of it.

Require them to contribute, but do not expect them to pay any of the associated costs, even though they may truly want to. If they can, great, but don't count on it. If they do give you money use it to pay down the mortgage or put it in the bank for their next financial emergency (there will be one)

If you can get it, you should have enough life insurance (term) to pay off the property when one of them passes.

Just my thoughts. Best of luck to you, its a tough situation and I feel your pain.

Thankfully I own my townhome nearly outright. I've been very lucky in the past year to be able to do this, and a bit of help for my late grandmother. What you mentioned is actually what they suggested, which is to have me buy a home which they will move into with me. This may be somewhat possible as I do travel a lot for work and it wouldn't be too much an issue. Unfortunately an increased home in size also means increased bills, and as it stands right now in spite of them claiming they would help the bills would ultimately fall on me. One of the reasons I do live in a townhome is the decreased bills compared to owning a house and throwing as much money as possible into my own business. This means that putting down any sizable down payment would be out of the question.

I think I'm more likely to assist them with finding rent on a place. Even though I travel a lot, just being in the same place with my parents would add a level of stress in my life which I don't need.

Thank you all for your responses.

[jimmillion]

^Sounds like you've thought this through a little more and have made your own conclusions. best of luck with everything and we're all here if you need advice on anything else.

[be6sti]

You're a good person glad you've got the ball rolling.


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[os86]

Some of the comments in this thread amaze me !! seriously.

Never forget that they raised you and how much they would have gone through to give you the best. I know from experience.

The easier solution will be for them to move in with you to lower the financial burden as I understand buying them a house not a feasible option.

FFS.... at the end of the day they are you parents and family is very important

[whitefrs]

Smh

[jarviz]

I was close to buying a car for my parents, but a home is a whole different level. I wouldn't hesitate to help them out as long as I had the financial upkeep. But if I need to eat ramen noodles for the next 20 years so they can live in McMansion, then the arguments might get pretty heated.

Originally Posted by RRnold

So is your sister and parents going to be in the same home?

I don't mean to cross the racial barrier but are you white/caucasian? I'm only asking because a lot of my Asian friends actually did this for their parents as a gift; Chinese, Filipino and Vietnamese. They helped move them into a nicer home along with the relatives so even though they are old, they'll have family around to help watch and take care of them.

Yea that sounds like us asians haha. I want to move them out one day but in the mean time I'm just gonna freeload off of them as much as possible