You Inherited a House You Don’t Want. What Are Your Options?

Inheriting a home can be a blessing, but it can also create an unexpected responsibility.

Maybe the home belonged to a parent or another family member. Perhaps you already own a home and have no need for another one. The property may need repairs, have years of accumulated belongings inside, or be located somewhere you don't want to live.

Whatever the circumstances, inheriting a house does not necessarily mean you have to keep it.

If you've inherited a property in Tucson or elsewhere in Southern Arizona, here are some of the options worth considering.

Option 1: Sell the Home on the Traditional Market

For many people, selling is the simplest solution.

Before deciding how to sell, however, it's important to understand the home's current condition and potential market value.

Sometimes spending money on repairs, cleaning, landscaping, or cosmetic improvements can help a property sell for more. Other times, putting significant money into an inherited home simply doesn't make financial sense.

That's where I believe good real estate advice becomes especially important.

You need to know what the property may be worth as it sits today versus what it might be worth after improvements.

Then you can make an informed decision instead of automatically spending thousands of dollars preparing a home for sale.

Option 2: Sell the Property As-Is

What if the house needs considerable work?

You may still be able to sell it without remodeling it.

An as-is sale can be particularly attractive when heirs don't have the time, money, or desire to renovate a property before selling.

That doesn't necessarily mean accepting the first lowball offer that comes along.

Depending on the property and the market, an as-is home may appeal to investors, renovation buyers, landlords, or even owner-occupants willing to make improvements themselves.

The important question is:

What strategy gives you the best combination of price, convenience, time, and risk?

The answer won't be the same for every inherited property.

Option 3: Keep It as a Rental

Another possibility is keeping the property and turning it into a rental.

That could potentially provide ongoing income while allowing you to retain ownership of the real estate.

But becoming a landlord shouldn't be an automatic decision simply because you inherited the property.

Consider maintenance, repairs, insurance, property taxes, vacancy, property management and the responsibilities that come with owning a rental.

You should compare the potential return from keeping the property with what you could accomplish financially by selling it.

Option 4: One Heir Keeps the House

Inherited properties can become more complicated when several people inherit the same home.

One person may want to sell immediately. Another may want to keep the property. Someone else may have an emotional attachment to the family home.

In some situations, one heir may be able to purchase the interests of the other heirs.

Because ownership, financing, estate and tax issues can be involved, this is an area where appropriate legal, tax and financial professionals may need to be consulted.

Before You Put the House on the Market

Before signing a listing agreement, make sure it has been determined who actually has the legal authority to sell the property.

Depending on how the property was owned and the estate was structured, that could involve an estate, trust, beneficiary arrangement, probate proceeding or another form of ownership.

A REALTOR® can help you with the real estate side of the transaction, but legal and tax questions should be addressed by qualified professionals.

And taxes deserve particular attention. Inherited-property tax treatment can be different from selling a home you've personally owned and occupied. Before making a major financial decision, speak with a qualified tax professional about your particular circumstances.

Don't Automatically Clean Out or Remodel Everything

This is one of the biggest points I would make to someone who has inherited a house:

Don't start spending money until you know what you're trying to accomplish.

You may not need the new flooring.

You may not need to repaint the entire house.

You may not need a new kitchen.

And you may not need to completely renovate the property before putting it on the market.

Let's first determine the property's likely value, its competition, the probable buyer for the home, and what improvements—if any—could reasonably help the sale.

Then you can decide where your money is best spent.

You Have Options. Let's Figure Out Which One Makes Sense.

Inheriting a home can involve financial decisions mixed with family considerations and, sometimes, a lot of emotion.

You don't need someone pressuring you to sell.

You need good information.

If you've inherited a property in the Tucson Metro area and aren't sure what to do with it, I can help you evaluate the real estate side of your options.

We can look at the home's condition, current market value, potential selling strategies and what you might reasonably expect if you put it on the market.

Then you decide what makes the most sense for you.

Wes Stolsek, REALTOR®

OMNI Homes International

520-404-9773

www.wesleystolsek.com

This article is intended for general real estate information and is not legal, tax, probate or financial advice. Consult the appropriate qualified professionals regarding your individual circumstances.