All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad is His slave and Messenger.
We have already issued Fatwa 84608 clarifying that the wife has the right to have an accommodation with separate amenities and that she is not obliged to live with her in-laws in the same house that is not separate. Rather, it is not permissible for non-Mahrams to live with her, like the brother of the husband. ‘Uqbah ibn ‘Aamer narrated that the Prophet said: "Beware of entering upon marriageable women." A man from the Ansaar remarked: "O! Messenger of Allaah, what do you say about the male in-law (the woman's husband's male relative like his brother, uncle, cousin, etc)?’ He replied: “He is death itself (i.e. his seclusion with her is as serious and dangerous as death)." [Al-Bukhari and Muslim]
This means that an in-law should be feared more than other non-Mahram men, and evil and affliction is expected from him more than anyone else, as he may be in seclusion with the woman without anyone denying this from him, contrarily to a stranger. An in-law is the narration means the male relatives of the husband other than his father, grandfather and children.
Therefore, you are right in your position and feeling uncomfortable is a sound reason. Hence, it is permissible for you to ask your husband to try to solve the problem with his brother, like looking for another accommodation for him, or prepare a part of the house to be a separate accommodation for him and so forth. However, we advise you to be soft and lenient when discussing the matter with your husband.
Allaah Knows best.