First, we’re so sorry for your loss. This can be a very challenging time for many reasons, and dealing with property ownership is tough at the best of times. And it is especially stressful at this time. Not only are you grieving but you have a multitude of things to take care of.
You’re thinking, “I inherited a house, what to do with this house?” Should I rent it? Should I sell it? How should I sell it? When should I sell it?
Tons of options open for you, but…
… we can help.
We’re seasoned real estate agents in Floresville real estate, and we work with investors looking to buy several houses each month in the Floresville TX area. So when we get calls from those who have inherited a house and are looking to sell the house we know the information to review with the heirs… Do you sell to an investor? Do you sell retail? Do you use the house as a rental?
so the info below are some important tips to help you navigate the process.
I Inherited A House, What To Do Next?
Here’s a few important considerations to help you make the right decision:
1) Make sure the mortgage is paid.
This may sound obvious, but if the person who left you a property also had a mortgage (unless it had no mortgage and was paid off, which is great!), you have to pay it (assuming you want to keep the property). Some banks will allow you to assume the loan, while others may force you to refinance into a new loan. If you don’t qualify for a new loan, renting may not be an option for you.
2) The investment is only as good as the manager.
If dealing with brokers, maintenance, tenants, rent collection and all the nuances of property management isn’t the best use of your time, hire a professional to help you or cash out now. Some people who inherit homes decide to keep the house and rent it for extra income. That’s a great strategy for sure. You just need to be prepared to manage the property and the hassles that can go along with tenants and toilets. Or you need to hire a property management firm. Ask us for references because you need a good one. One that understands the rental process: how to screen tenants, how to vet tenants, how to respond to tenants legally, what rent to charge, how to handle late payments, how to get repairmen out to fix items, do you charge the tenant when the kids have flushed toys down the toilet for the 4th time and how to evict. Yes, eviction can come with the territory of renting houses.
3) Property ownership costs money.
It’s rare to see a building that’s been perfectly maintained. Most inherited houses need major improvements.
Consider hiring a professional property inspector to give you a detailed rundown on what you’ll need to do within the next five years, along with estimated costs. Surprises are very, very expensive. Being armed with that information helps you make a wise decision in what to do with the house. Is it worth keeping? Is the investor talking real repair costs when they decide what they want to pay? If selling retail is the house being priced right for the condition to sell?
4) Selling a property for top dollar costs money.
If you don’t want to deal with making repairs, updating kitchens, improving landscaping and overall cleanup, don’t worry investors buy for cash in an “as is” condition. But your house may not need expensive repairs to sell for a good price. We can tell you that.
5) If the market will continue to grow faster than your other options, hang on to the investment.
We can help you analyze the value of your property today versus the long-term benefits of renting. If you can use the equity in your property in another way that outpaces the performance of the real estate market, you should. If you don’t have anything better to do with the money and the neighborhood is rising in value, hang on – real estate can be a great investment if you know how to correctly read the market.
6) Uncle Sam wants a piece of the action.
Don’t forget to discuss your inheritance with tax and legal professionals before you take action. There are major property and income tax consequences that will dramatically impact the cost of owning your investment.
7) Consider all your options.
In certain situations we may be able to help you structure a seller finance agreement that allows you to sell without repairs – capturing the best of both worlds. These kinds of deals can be complicated, but our investment experience can help you win.
8) Compare a few scenarios.
We’ll help you determine prices for any property in the San Antonio area – if you sold it today without doing any work, the highest price the market will bear, and the projected value of keeping it as a rental (along with the costs). And what option might work best for your situation.
For more articles on inherited homes:
What happens when you inherit a house?
Is there a holding period when I inherit a house?
Can I sell an inherited house while in probate?
Can I sell an inherited house while in probate?