We express our deepest condolences for your loss. We understand that this may be an extremely difficult time for you, and dealing with property ownership can be especially challenging during such a period.
You may be wondering about your options if you have inherited a house. Perhaps you’re thinking about renting it out, or selling it, but you’re not sure how to go about it.
Tons of options open for you, but…
… we can help.
As experienced investors in the real estate market of the Bay Area real estate, we have ample experience in purchasing several houses each month in the the Bay Area California region. We often receive inquiries from people who have inherited a house and want to sell it. In light of this, we have compiled a few tips that may assist you in managing the process.
I Inherited A House, What To Do Next?
Below are some key factors to take into account when deciding what to do with an inherited house:
1) Make sure the mortgage is paid.
It’s important to note that if the person who bequeathed the property to you had a mortgage on it, you would have to take over the mortgage payments if you wish to keep the property. However, if the property was free and clear of any mortgage or debt, then it’s an advantage. Certain banks may allow you to take over the existing loan, but some might require you to refinance the property with a new loan. In case you don’t qualify for a new loan, renting out the property might not be a viable option.
2) The investment is only as good as the manager.
The success of your real estate investment depends heavily on the quality of management it receives. If you find yourself overwhelmed with the responsibilities of being a landlord such as dealing with brokers, maintenance, tenants, rent collection, and other intricacies of property management, it may be wise to hire a professional manager or consider selling the property. Inheriting a house and renting it out for additional income can be a viable option, but it also requires proper management and entails potential challenges such as dealing with tenants and maintenance issues.
3) Property ownership costs money.
Owning a property involves expenses. It is uncommon to come across a building that requires no repairs or maintenance. Typically, inherited houses need significant upgrades or improvements to bring them up to code. To get a better idea of the work required and the associated expenses.
It’s advisable to hire a professional property inspector. This inspector can provide you with a detailed report on what needs to be done within the next five years and the estimated costs. Unexpected repairs can be extremely expensive, so it’s best to be fully informed upfront.
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. Our list of buyers buy the Bay Area houses for cash, as-is.
5) If the market will continue to grow faster than your other options, hang on to the investment.
If you have invested in real estate and the market is consistently growing at a faster rate than other investment options available to you, it is wise to hold on to the investment. At our company, we can assist you in evaluating the current value of your property in comparison to the long-term gains of renting it out. If you have other investment opportunities that yield better returns than real estate, it’s best to use the equity in your property elsewhere. However, if you have no other viable options and the property’s value is appreciating, holding on to it may prove to be a profitable investment. It’s essential to have a clear understanding of the market before making any decisions.
6) Uncle Sam wants a piece of the action.
Before taking any action on your inherited property, it is important to discuss the matter with tax and legal professionals. It is essential to understand the potential tax implications and liabilities that come with inheriting a property. Failure to take into account the applicable property and income taxes can significantly increase the cost of owning and managing the property. Therefore, seeking professional advice can help you make informed decisions and avoid costly mistakes.
7) Consider all your options.
In certain situations we may be able to help you structure a lease-option agreement that allows you to rent and sell at the same time – capturing the best of both worlds. These kinds of deals can be complicated, but our Los Gatos investment experience can help you win.
8) Compare a few scenarios.
We’ll help you determine prices for any property near Los Gatos – 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).