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Buying Your Parents' House Below Market Value

The discount is a gift, with tax consequences.

Buying Your Parents' House Below Market Value Residential Property Services in London

Updated October 2026 · Fraser Bond

Family · Buying

Buying from your parents

Giftedequity
IHT7-year rule
SDLTon price paid
Siblingsfairness
In short: Parents can sell their home to a child at a discount, and many lenders accept the discount as "gifted equity" towards the deposit. The discount is treated as a gift: if your parents die within seven years, it may count for Inheritance Tax. Stamp Duty is normally based on the price you actually pay. If the property is your parents' main home, Private Residence Relief usually means no Capital Gains Tax. Get an independent valuation, separate solicitors and tax advice, and talk openly with siblings.

Frequently asked questions

Will a lender accept gifted equity?

Many do.

Is there CGT?

Usually not, if it's their main home.

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