Cohabitation: One Person Owns the House Outright Edition
July 10, 2018 9:28 AM   Subscribe

I will be moving into my partner's house that he owns outright in about a month. What are some things that we should be talking about and planning for?

My partner currently owns his house/is not paying on a mortgage, so me having equity is not an issue - I will essentially be contributing to home maintenance/property taxes. I'll be paying significantly less than market rent, and it's a deal that we both feel good about. I mostly am concerned about what we should have in place before I move in - how do we make it where it feels like its our home rather than his home? What are the tricky things that I am not thinking about? How do we navigate the tension of "it's our home, but it's really his home." Thank you so much!
posted by socktothepuppet to Human Relations (15 answers total) 13 users marked this as a favorite
[assuming you live in the United States, which is a statistically likely assumption]

I'll be paying significantly less than market rent

The IRS views the difference between market rent and what he charges you as a taxable gift from him to you. Likely the yearly gift tax exclusion ($15K for 2018) will cover this, but it's something he should know for tax planning purposes.
posted by saeculorum at 9:32 AM on July 10, 2018 [1 favorite]

If you and your partner are not married, make sure that he has things in place for what should happen to the house if something should happen to him and that you have discussed it.

Have a conversation about whether you will contribute to homeowner's insurance and whether you are generally okay with whatever the deductible limits are (since maintenance may include something that insurance could cover but doesn't if you have high deductibles) and same for utilities (some people like to run AC all summer, some do not)

Have a conversation about what sort of things are "repairs" and what sort of things are maintenance and who pays for each.

Have a conversation about elderly family members that you may or not feel responsible to and how their futures might intersect with your own.

Have a discussion about whether there are any parts of the house which are "off limits" or "personal" spaces (for either of you) and what those outlines look like.

Have a discussion about potential reno/rehab things you have in mind (i.e. if you find the bathroom unliveable, would you fix it together or would be be like "hey you knew what it was like when you moved in) and also discuss how many home projects you want to DIY and how many you'd prefer to get contractors for.

Have a conversation about how often you are going to revisit whatever financial arrangement you have set up. Or if there would be a readjustment if either of your finaincial situations changed.

Have a conversation about what would happen if you were to sell the place (i.e. is it a foregone conclusion that you'd buy a new place together? that he would buy a new place for both of you?) or, of course, split up. Especially things like which things bought for "the house" are items you own together and which are things he gets for his house.

Have a discussion about houseguests and how you feel about them, how long they stay, etc.

Some of these are just normal cohabitating couple things but can take on a different feeling if there is an unequal distro of resources.
posted by jessamyn at 9:46 AM on July 10, 2018 [12 favorites]

Oh hey, me of ~4 months ago! I moved in with my boyfriend in March and we are in exactly the same situation you describe, only difference being that he just bought the house in March, and I actually moved my stuff into it before he did.

Some thoughts: do we make it where it feels like its our home rather than his home?

This was probably easier for us since the house was brand new to both of us, but the biggest thing for us was consistently using "our house" language. When we'd first moved in we were both guilty of sometimes calling it "your house" (in my case) or "my house" (in bf's case). That language hurt both of our feelings a bit, so we have really focused on always saying "our house" or "the house." It also affects how other people talk to us about the house in a very positive way.

We sometimes buy smaller stuff without asking, but any Major Purchase (any appliance, furniture, rug, art, blinds, etc.) is something we discuss together. Sometimes this means one of us does the research and says "Here are some options I like, what do you think?" (That's my preference.) Other times we will sit down on the computer together and research something. (That's his preference.)

How do we navigate the tension of "it's our home, but it's really his home."

I think a lot of this is on your partner, actually -- my bf never lords his ownership of the house over me in any way, never insists on getting the final say on something because he has more money on the line, etc. We knew going in that it is probably not our forever house, and he always says "when WE sell in a few years" (emphasis mine) so that I know I'm part of the picture even if I'm not on the deed. That type of thing.

What are the tricky things that I am not thinking about?

You may already know this, in which case disregard, but: Neither of us had ever lived with a SO before, and we were both shocked at how HARD it was at first. We love each other, see a real future together, and get along swimmingly... but the first couple of months were rough for us both. We discovered all sorts of obnoxious/endearing things about each other and realized that we needed to hone our communication skills. So I guess what I'm saying is, be prepared for a bit of a slog.
posted by schroedingersgirl at 9:48 AM on July 10, 2018 [3 favorites]

It sounds like you're already past this point but the 101 level of these type of things is to put whatever you decide to do/pay/abide by into writing and both sign it. Bonus points if you use a standard legal form and/or consult a lawyer for a draft of the same that would stand up if things do hit the proverbial fan.

On the personal side of things, and forgive the intrusion if this qualifies as that, but the whole "How do we navigate the tension of "it's our home, but it's really his home" thing should resolve itself out rather quickly or else it's a harbinger of future potential woes. It goes without saying that any sort of him lording over you the fact that it's "his" home that "he paid for" would be a huge red flag. Not that you said as much but, short of that I mean, I think you might be overthinking it or are just stressed about it, which is understandable.
posted by RolandOfEld at 9:49 AM on July 10, 2018 [2 favorites]

You should consider talking to a lawyer and drawing up a formal agreement that explicitly details what you are and are not entitled to in the event that you break off the relationship.
posted by tobascodagama at 9:50 AM on July 10, 2018 [2 favorites]

We call our monthly mortgage(me)/rent(him) payments our "contributions to household expenses" instead of rent -- he direct-deposits his contribution to my account, from which I pay mortgage, utilities, phone and subscriptions like Netflix. We do this once a month, automatically, to avoid having our relationship become transactional. Our contributions are based on market rate tweaked by our relative incomes, not on the actual amount of the mortgage, which is low because I put a significant amount down, not because of the value of the home.

The house is in my name only, so I am responsible for anything that has to be done on it (replace the roof, repair the A/C). We both contribute to any home project that is not needed but we both want for our lives (built a deck). And we each are responsible for anything that either one of us wants but we don't both care about (I want a privacy fence and he doesn't care, so that's on me). The percentages we each contribute here are also based on our relative incomes.

We are consciously open to the other's aesthetic. I like bold colors, he likes beige. I hate his couch but it's the first thing you see when you walk in the door because he loves it and I love him. We have a "house meeting" every other week, partly to compare calendars and plan roadtrips, and partly to check in with each other on anything domestic-related.

The projects have had the most impact on his feeling like it's his home too, since we have made/will make changes that he wants to make, and we see the results of those every day.
posted by headnsouth at 10:06 AM on July 10, 2018 [1 favorite]

The IRS views the difference between market rent and what he charges you as a taxable gift from him to you. Likely the yearly gift tax exclusion ($15K for 2018) will cover this, but it's something he should know for tax planning purposes.
I don't think this is true. Letting someone move into your home is not the same as turning it into a rental unit.
posted by Kriesa at 10:13 AM on July 10, 2018 [7 favorites]

Aside from the great stuff above ....

For many people, you (and your bank) buy a house and you slowly build equity and wealth by paying down the mortgage, such that at age 60 or 70 you own a paid-off house that you can retire in. If you will not be accumulating savings in that type of vehicle -- will you be saving extra (to a retirement account) in place of that?

If partner were to die unexpectedly, would you have any inheritance rights?
posted by Dashy at 11:34 AM on July 10, 2018 [4 favorites]

Continuing on the topic of death and the house - I'd discuss what the plans are for the house in case he does. Is the house expected to be willed to someone else? If so, do you know what their plans will be for the place - will they want to keep it, or liquidate it instead?

What if he has significant debts, where the house will have to be liquidated in order to pay those after he dies?

I mention this because when my mother died, we had to sell her condo in order to pay off debts, and that meant that her current roommate had to move out. (I also had an Estate Lawyer help with those proceedings.)
posted by spinifex23 at 1:18 PM on July 10, 2018 [2 favorites]

how do we make it where it feels like its our home rather than his home?

But it is his home.

What are the tricky things that I am not thinking about? How do we navigate the tension of "it's our home, but it's really his home."

I would advocate for taking the opposite tack: acknowledge and live by the fact that it's his house. He put all the equity into it, and until you get married, he'll get all the proceeds in a sale. You don't want to be on the line for a potential $10k roofing overhaul that needs to be done; he does since it's his house, and he needs to protect its value. Foundation cracks and basement floods? Don't spend thousands and waste a month - just move out!

I think you should use the tried and true model for when one person owns the property and the other person lives there: landlord/tenant. You pay him a monthly fee which should cover his property taxes and insurance and potential maintenance, and he ensures his property is well maintained and keeps its value, whatever that entails. He's on the hook for maintenance and repairs, and you're free to move out whenever you want. You have to ask his permission when modifying the property, since its his, and his value at stake.

That should give you the model, which has stood the test of time and has answers on the internet and in the books, for sorting out any of your "tricky things" that come up.
posted by losvedir at 2:03 PM on July 10, 2018

how do we make it where it feels like its our home rather than his home?
> But it is his home.

Not to be trite, but a house is not a home. Like yes, OP's partner is the sole owner of the physical property and gets to enjoy the financial perks (and responsibilities, and risks) of owning that asset. But OP doesn't need to be on the deed to make a home with their partner. Making a home with someone is more about sharing chores, making decisions together, and learning to love the fact that they are really weird about where they hang their towels.

OP, I recommend you distinguish these things in your head. It helps!
posted by schroedingersgirl at 2:42 PM on July 10, 2018 [3 favorites]

I don’t see any mention of it here, but you should have a lease agreement, especially if you’re paying what essentially amounts to be rent. You would be a tenant, and tenants have rights, even if they differ a bit when it’s a situation where the landlord and tenant are roommates, as opposed to the tenant being the sole occupant of the property. If you break up, you don’t want your housing to depend on someone being a super-nice person, as opposed to just dumping your crap on the lawn and changing the locks, and letting you deal with proving your tenancy while scrambling for a roof over your head.

If your relationship approaches the point where you’re discussing marriage, then you can revisit the situation to see how the house falls in with regard to marital assets and a pre-nup and all that. But in the meantime, you would legally be a tenant and you should have the protection of a lease. This would also go a long way in formalizing your agreement about who should pay what and what the expectations are for maintaining the property.
posted by Autumnheart at 7:48 PM on July 10, 2018

All of this is so useful, and it's also a relief because it's a lot of stuff we have had conversations about. I think the house vs home distinction is really useful, and I love the idea of calling it "household expenses" - we had already planned to do the direct deposit thing, so I'm glad that is working well!

It's a three-bedroom house, and we've already decided that there's mostly-his space (the library) and mostly-my space (an office/rarely used as guest bedroom hybrid) - we've been talking about decorating/making plans.

We're really excited, but having a formal lease makes so much sense! Thank you so much for all of this advice.
posted by socktothepuppet at 8:38 PM on July 10, 2018 [3 favorites]

I own my house and when my girlfriend moved in, one thing I made sure of was that at least one utility was in her name as an easy way to prove residency. (I live in Somerville, MA, USA, and for things like parking permits, a lease is not considered proof of residency, but having the gas or electric bill in your name is.)
posted by rmd1023 at 1:07 PM on July 11, 2018 [3 favorites]

Just going to Nth some of the advice above -
split bills by income percentage, especially if your incomes are very far apart;
absolutely write up a rental/financial agreement;
decide what would happen if he passed away suddenly (and possibly talk to a lawyer if alternate arrangements are needed - I were OK with the house going to my SO's parents because they love me and wouldn't boot me immediately/I wouldn't want to live there without him anyway so I'd be fine moving, but if the standard path doesn't work your SO may need to update/create a will);
language like "our home" and "when we sell" makes a huge difference;
try to make decorating decisions together;
and generally follow the usual advice on moving in with someone (things like, laying out house rules, allowing an adjustment period, setting the standard that it's ok and not mean to retreat to your own rooms when you need alone time, etc).

The only things I'll add are:
1) Make sure you get some kind of insurance for yourself, either renters or added to his homeowners insurance (my BF's homeowners wouldn't allow him to add me so I got my own renters insurance as a "tenant", but YMMV) - you want to make sure your belongings are covered in an emergency.
2) One of the tricky things to watch out for as you're writing up a rental agreement about costs is that "fair" doesn't always mean each person paying the same thing (or even just a consistent percentage of costs), and what "fair" means usually looks different to each of you. Finding a compromise can be tricky because it sometimes feels like one of you is hoarding your money, or that the other person doesn't trust you to *not* hoard your money even though you are planning to be together for a long time. There's a lot of emotion tied up in money stuff! But it's good practice for the relationship in general to talk these things through, especially if you plan to get married and/or progress towards more shared finances.
3) A general refreshing of decor/furniture before/right when you move in (that you jointly decide on) would probably help with it feeling like your home, even if it's just re-arranging the living room or getting new sheets for the bed.
4) Another random thing that helped me feel more like it was my own place was updating my address on all my accounts, including stuff that I only update rarely/more permanently (e.g. drivers license, checkbook). Of course, if you do break up, it's more of a pain to change those things back haha. But this was an important step for me in feeling like I wasn't "just a renter".
posted by jouir at 1:07 PM on July 11, 2018

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