Do You Have to Sell Your House to Pay for Care?

Topic cluster: Care Home Costs & Funding | Reading time: 7 min

This is one of the most common fears families have — and understandably so. The family home often represents a lifetime of work, a sense of security, and hoped-for inheritance. The truth is more nuanced than a simple yes or no. Whether your parent has to sell their home to fund care depends on their circumstances, the type of care needed, and who else lives in the property.

The Short Answer

For care at home: No. The value of your parent's home is not included in the financial assessment when they are receiving care in their own home. Only savings and income are assessed.

For a care home: It depends. If your parent moves into a care home and no one with a protected status remains in the property, the home's value is usually included in the financial assessment — which commonly means they must fund their own care (at least initially).

When the Home Is Excluded from the Assessment

The property value is not counted in the financial assessment for a care home placement if:

A spouse, civil partner, or cohabiting partner continues to live there
A relative aged 60 or over continues to live there
A disabled relative continues to live there
A divorced or estranged partner continues to live there as a lone parent
A dependent child under 16 continues to live there

In any of these situations, the council cannot include the property value in the means test. Your parent's care may be partially or fully funded based on savings and income alone.

When the Home Is Included in the Assessment

If none of the above apply — for example, your parent lives alone and moves into a care home — the property value is almost certainly included. This often pushes the total above the threshold (£23,250 in England in 2026), making your parent a self-funder.

Important: Being a self-funder does not automatically mean you must sell immediately. There are alternatives.

Alternatives to Selling the Home Immediately

The 12-Week Property Disregard

For the first 12 weeks of a permanent care home placement, the home's value is excluded from the financial assessment. The council temporarily funds care (if savings excluding property are below the threshold), giving time to plan without the pressure of immediate sale.

Deferred Payment Agreement (DPA)

The local council pays your parent's care fees and is repaid when the property is eventually sold — during your parent's lifetime or from the estate after death. Interest applies (at or below a government-capped rate). Eligibility requires savings below £23,250 (excluding the property), and the property must not be a home of an eligible person.

A DPA means your parent can move into care, and the property can be rented out (generating income that reduces the amount owed) or sold at a later date.

Renting the Property

Instead of selling, your parent (or family) rents the property. Rental income can contribute to care fees and reduce the drawdown on other savings. The property remains an asset.

Bear in mind: if your parent is self-funding care, the value of the property (as an asset) will eventually need to be declared if seeking local authority funding as savings fall. Rental income is assessed as income.

Can You Give the House Away to Avoid Care Fees?

Families sometimes ask whether they can transfer the house to children or put it in trust to protect it from care fees. This is a complex area with significant legal risk.

Deliberate deprivation of assets: If the council believes your parent transferred assets — including property — specifically to avoid paying for care, they have the power to treat the transfer as if it had not happened. The property value may still be included in the financial assessment.

Courts have upheld councils' right to challenge transfers even when made years before care was needed. The 7-year rule is sometimes mentioned, but this applies to gifts for inheritance tax purposes — it is not a reliable guide for care fee planning.

Trusts: Placing a property in trust may provide some protection in specific circumstances, but not always. The council will scrutinise the timing and purpose of any trust arrangement.

Anyone considering these approaches should seek independent legal advice from a solicitor specialising in elder law — not act on general guidance alone.

Jointly Owned Property

If the property is jointly owned — by your parent and a sibling, for example — only your parent's share of the property value is counted in the financial assessment, not the full value. The council cannot force a sale of jointly owned property.

What Happens If the House Can't Be Sold?

Some properties are difficult to sell (subsidence, probate issues, jointly owned with a reluctant co-owner). In these circumstances:

A Deferred Payment Agreement may still be possible
The council can only count the value of what could realistically be realised — they cannot force a sale
Seek specialist legal and financial advice

Practical Next Steps

Get a care needs assessment and financial assessment from the local council
Understand whether any person has protected status in your parent's property
Explore whether a Deferred Payment Agreement is available
Take advice from an independent financial adviser (ideally SOLLA-accredited)
Consider whether rental income is a viable short-term strategy

Explore care home options at homeformum.com