Rent your home out

Renting our your property to fund care fees 

You can rent out your property and use all or part of the rental income to help pay for your care fees. This can be a good option if:

• your family is keen to keep the property, or
• a quick sale would make it difficult to realise the property’s full value.

In some cases, rental income may cover the full cost of your care. In others, it can at least contribute towards it.

Once you have rental income to put towards your care, you can top it up using:

• savings
• pensions
• other sources of income or realisable assets.

If you’re renting out your property, you should allow for ‘void’ periods, times when the property is empty and not generating income. Make sure to factor this in when calculating your expected rental income. You should also consider ongoing costs such as redecorating, repairs, and replacements. Additionally, rental income is taxable, so you’ll need to account for any increase in your tax bill.

Advantages of letting your property

• Provides a continuous stream of income, potentially indefinitely, reducing concerns about running out of funds for care
• Keeps the property within your estate and ensures it remains occupied
• Tenants are responsible for utility bills and council tax
• You may benefit from any future increase in the property’s value
• Avoids the need to sell your home during a downturn in the housing market
• Helps your family retain ownership of the property.

Disadvantages of letting your property

• Property values can decline, which may reduce the overall value of your estate or affect future plans to sell the property
• There may be periods without tenants, resulting in no rental income
• You may face maintenance or tenant-related issues, such as:
  o unpaid rent
  o redecorating costs
  o repair expenses
  o replacing fixtures, fittings, or furniture
• Being a landlord comes with legal responsibilities. If you’re living in a care home, you may need to appoint someone to manage these on your behalf, including ensuring the property meets current regulatory standards
• Managing the property yourself can be time-consuming and stressful. Using a letting agent can ease the burden but will incur additional costs
• Rental income may not fully cover your care fees and other living costs
• You could be liable for Capital Gains Tax when the property is eventually sold
• Rental income might:
  o push you over the threshold for local authority support
  o move you into a higher income tax bracket
  o affect your eligibility for certain benefits
• Care home fees may increase faster than your rental income.

Getting help to rent your property

A professional letting agent can manage the rental process for you.

If you choose to hire an agent, look or one registered with ARLA Propertymark, whose members must meet higher standards than those required by law.

A good letting agent will:

• advise on the appropriate rental level
• recommend any necessary modifications
• vet prospective tenants
• manage rental payments
• organise ongoing maintenance and repairs.

It’s also advisable to speak with an experienced and qualified care fees adviser before deciding to rent out your property.

They can help you review your finances and plan how to cover your care costs. They’ll also understand how the care system works and what funding options may be available to you. You can use our care fees adviser directory to find a local financial adviser.