I INHERITED A HOME, NOW WHAT?
Brought to you by Advantage Asset Management – A Houston Property Management Company
Inheriting a home from a family member is a common occurrence. This is not something most people typically plan or think about, but as a property management company in Houston, we can tell you it happens fairly often. When you’re now responsible for a home that was not originally yours, it can create stress figuring out the path forward. In this article, we will help guide you by discussing the pros and cons on what to do next.
What are my options?
There are many options for the home you have recently inherited, and it really depends on your personal goals / current situation. If this happens to be a great home on a lake, and you’re able financially to manage it, you may just have a nice vacation home. That said, we typically get questions about homes that are more traditional, single family homes
Some basic questions to ask yourself before making a decision:
– Are there other family members involved? If multiple family members are involved, decisions will be more difficult unless all are in agreement on approach.
– Is this home in a desirable location? Is the area growing or shrinking?
– Is the home paid for? What are the financial obligations, mortgage, taxes, HOA, etc.?
– What could I sell the home for? What could I rent it for?
– Would it sell fast? Would it rent fast?
– Does the home need repairs? How much?
– What is my emotional attachment to the home?
This is a pretty common by default. Many of our clients are inclined to sell their property and pocket some extra money. You wouldn’t have to deal with the property long term, it makes logical sense. If multiple family members inherited the property, it means everyone has to agree only this one time. Having to agree on rent, price, etc. with several family members could be a potential headache…
If you’ve ever had real estate ambitions, this is one of the easiest ways to venture into it. We have property management clients that are interested in seeing how it works, and we have other clients who want to leverage this to build up a bigger portfolio in the future. One big positive with renting is that this is not a decision that you have to live with forever, you can see how it works out. Renting gives you “optionality” and the ability to sell later on, should you decide. You can reap some short term tax benefits, maybe a little extra cash flow on the home, and hold out for a better price to sell later on…
REAL LIFE STORIES
(names changed to protect anonymity)
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