In addition to the emotional impact, losing your parents or another family member may result in many new responsibilities and priorities for the bereaved, especially if you and/or your siblings will be inheriting a house. This situation can present a number of challenges, depending on your present living situation, relationship with your siblings and your financial standing.
Basically, inheriting a house will leave you with three options: Sell it, rent it or move into it. Let’s take a look at some of the pros and cons associated with each option.
Options when inheriting a house
- If you decide to sell it, you’ll want to contact an experienced Realtor who knows the neighborhood, especially if you live in another city or state. With the Realtor or real estate agent, you’ll want to look at comparable properties to determine a reasonable asking price. Until the property sells, you’ll need to keep up with payments such as utilities and taxes. And what about the mortgage? Is the house paid off or was your parent still making payments?
- If you already own a home, another option is to rent out the inherited property. This could be a way for you to generate income and keep the property in the family. On the other hand, there will also be additional expenses such as utilities, taxes, maintenance and repairs. If you decide to rent it, you may want to consider hiring a property manager to handle maintenance and repair work, assuming it makes financial sense.
- The third option when inheriting a house is to move in. While that can be a great solution, it can also cause added pressure if you already own a home that you would then need to sell or rent.
Whatever you ultimately decide to do, there will be countless other questions along the way. For example:
- What happens to all the belongings that currently fill the house? Will you keep these items, sell them or give them away?
- If the house was left to more than one child, make sure that everything is talked out and agreed upon to avoid any hard feelings down the road.
- There are tax implications related to all three scenarios (sell, rent or move in). Be sure to consult a tax professional before making a final decision regarding what to do with the property.
- How much work needs to be done in the house? Is it in good shape, or does it look like you just stepped out of a time machine and into an earlier decade?
When inheriting a house, one thing is certain: Don’t act too quickly! Allow yourself time to transition through the grieving process so you’re thinking clearly when it is time to evaluate all the pros and cons and make a final decision. If you have any questions, please contact the professional at The Olear Team today.