It depends, SQM is a static traffic shaper that can really only deal with variable rate links if supported by an additional measurement and adjustment script like for example https://forum.openwrt.org/t/help-to-make-sh-script-for-adjust-sqm-automaticaly/58754 (note I have never tried how/if that works well enough).
So without a flow queuing (fq) system in place there is no fairness guarantee at all, if your bursty youtube flows are also less sensitive for congestion signals than the rest of your traffic, they will gain more than their fair share of your ingress speed. A flow-queueing shaper like fq_codel/cake however will try to enforce equitable sharing under load. So with fq shaper you will notice your capacity limits more immediately than without. But note that without an fq-shaper it is simply the least sensitive flow that wins, so depebding on the competing flows, youtube is not guaranteed to come out on top...
You could try per-internal-IP-fairness in cake (see the sing and dance section) which might solve your issue, but then again, it might not as it really depends on your users combined usage patterns (that saif it is a rather easy to understand fairness mode, all active IP-addresses/hosts will get at most their fair share of the available speed, but that fraction of your link speed is not guaranteed to be large enough for any specific use-case, like you-tube streaming).
You could try that. Or you could force your neighbor behind an additional layer of NAT, in which case your neighbor will only count as much as a single of the users in your own network. Without any competing load from your own IP addresses your neighbor will get the full links bandwidth...
IMHO it seems "fairer" to not do this and simply include your neighbor's IP addresses into a general by-internal-IP-fairness scheme, but it is your network so IMHO also for you to decide.
If you can identify this then sure. BUT per-internal-IP-fairness will do wonders to restrict the "pain" from torrenting mainly to the machine that is running the torrent software, everybody else should be much happier. (And on the torrenting host it does not seem too onerous to expect any interactive user to pause the torrents while doing other work).
It would be nice if you could post the contents of /etc/config/sqm and the output of tc -s qdisc. This is not available in the GUI, so if you have a linux/macos/wind10+linux-subsystem-for-windows cliet machine try the following from the command line/terminal:
ssh root@192.168.1.1 'cat /etc/config/sqm'
ssh root@192.168.1.1 'tc -s qdisc'