Parents may gift us a house – impact on Universal Credit and council housing?

serjfamily
serjfamily Community Member Posts: 24 Connected
in Housing and independent living

Moving from a council house to a gift home(my parents pay for a house gift to us - we get a free mortgage) – but we need more information?

Dear Sir or Madam,

I am deaf and would be grateful if communication could be made here.

I am seeking advice regarding a possible future housing situation. Nothing has been arranged or agreed, but I would like to understand the implications before discussing the matter further with my parents.

My wife, child, and I currently live in a council property and have done so for approximately 11 years. I currently receive Universal Credit, Employment and Support Allowance (ESA), and Personal Independence Payment (PIP).

My parents may, in the future, consider purchasing a property and gifting it to us as our family home. This would not involve money being paid directly to us. Rather, they would potentially purchase a property and gift the property itself for us to live in.

Before taking the matter any further, I would be grateful for advice regarding any implications this may have.

In particular, I would like guidance on:

  • Whether receiving a gifted property as our main residence could affect Universal Credit.
  • Whether it could affect ESA.
  • Whether it could affect PIP.
  • What information would need to be reported and at what stage.
  • Whether there are any housing-related issues I should be aware of.
  • Whether there are any legal considerations for either myself or my parents.
  • Whether any other matters should be considered before any decisions are made.

At this stage, I am simply seeking guidance so that I can understand the position fully before discussing it further with my parents.

Thank you for your time and assistance. I look forward to hearing from you.

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Comments

  • Mr_Shoes_Tied
    Mr_Shoes_Tied Community Member Posts: 123 Empowering

    You won't receive the housing element of UC any more but that's the only impact on benefits.

    Owning a house, even mortgage-free, can be expensive because you are liable for all repairs and stuff.

    For your parents, if it's close (I don't know exact figure but say 10 years) to them needing care home or stuff like that they can still count the property in their funding calculation. I don't know the full facts about this one but it can cause issues so they should speak to someone.

    But for your benefits it won't change anything other than you won't get help towards housing costs - as long as you are living in the house they gift you

  • OverlyAnxious
    OverlyAnxious Community Member Posts: 6,144 Championing

    Hi,

    You keep your Universal Credit - just lose the Housing Element as you no longer have any rent to pay.

    You keep your New Style ESA payment.

    You keep your PIP payment.

    You must make a Change of Circumstances with Universal Credit on or after the day you move into the new property. (It cannot be before the moving day). This is just to change the address and remove the Housing Element from your claim.

    You must also change the address with both NS ESA and PIP separately from UC. Usually this is done via telephone, but I assume you have other arrangements for that if you are deaf.

    There aren't really any other considerations for yourself. The house you live in is not classed as capital for means tested benefits, so the value of that does not affect your UC. Your parents giving away a large amount of capital could impact on them. But I can't comment on that without knowing their circumstances.

  • serjfamily
    serjfamily Community Member Posts: 24 Connected

    Thanks for the explanation 👍 @Mr_Shoes_Tied
    Just to clarify, UC is only affected in terms of the housing element. As long as the property is our main home, it is ignored under UC capital rules, so standard UC, LCWRA, and PIP should remain unchanged.

    The care home / future funding point relates to the parents’ circumstances and is separate from our UC claim.

    Just to be clear, is a main residence always fully disregarded for UC capital purposes, regardless of property value?

  • OverlyAnxious
    OverlyAnxious Community Member Posts: 6,144 Championing
    https://forum.scope.org.uk/discussion/comment/1132098#Comment_1132098

    Yes, the property you live in is always disregarded for UC capital.

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