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.
You’re thinking, “I inherited a house, what should I do with this house? Should I rent it? Should I sell it? How should I sell it?”
Tons of options open for you, but…
… we can help.
We’re seasoned investors in Boston real estate, and we’re looking to buy several houses each month in the Boston Massachusetts area. We understand that inheriting a home can be a complex and emotional experience. Whether you’re considering selling or renting, we’re here to guide you through the process and help you make the best decision for your circumstances. Every month we get calls from those who have inherited a house and are looking to sell the house, so the info below are some 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 key to a successful real estate investment is having a reliable property manager.
Managing brokers, maintenance, tenants, rent collection, and all aspects of property management can be time-consuming. If this is not your area of expertise, consider hiring a professional to handle these tasks effectively. Alternatively, you may opt to sell the property. Many individuals who inherit properties choose to retain them as rental units to generate additional income. While this can be a lucrative strategy, it is essential to be prepared for the responsibilities and challenges associated with property management, including dealing with tenants and property maintenance issues.
3) Maintenance and Repairs
It’s rare to see a building that’s been perfectly maintained. Inherited homes often require repairs and updates. Obtain a professional inspection to assess the property’s condition and estimate potential costs.
4) Selling vs. Renting
Evaluate the financial benefits of each option. If you prefer to skip the expenses of repairs, kitchen updates, landscaping, and general cleanup, no problem. Our team purchases houses in Boston for cash, in their current condition.
Selling: Explore the current market value and potential selling price after necessary repairs. Consider any capital gains taxes that may apply.
Renting: Estimate rental income, potential expenses (maintenance, property taxes, insurance), and the long-term appreciation potential of the property.
5) Consider Holding onto Your Investment if the Market Continues to Outperform Other Options
It’s important to assess whether the current growth of the market surpasses alternative investment opportunities. Our team can assist you in evaluating your property’s present value compared to the advantages of renting it out long-term. If leveraging the equity in your property for other ventures yields better returns than the real estate market, it may be wise to explore those options. However, if there are no superior alternatives and the local area is experiencing an upward trend in property values, retaining your investment could prove beneficial. Real estate has the potential to be a lucrative investment when you are able to interpret market trends effectively.
6) Tax Implications
Consult with tax professionals to understand the potential tax consequences of selling or renting the inherited property. Capital gains taxes, property taxes, and rental income taxes may apply.
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 Boston investment experience can help you win.
8) Compare a few scenarios.
We’ll help you determine prices for any property near Boston – 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).
How Hilary Dunlavey Homes Can Help
At Hilary Dunlavey Homes, we’re committed to providing comprehensive real estate services tailored to your unique needs. Whether you choose to sell or rent your inherited home, we can assist you with:
- Property Evaluation: Assessing the property’s value and potential rental income.
- Market Analysis: Identifying current market trends and identifying potential buyers or tenants.
- Property Management: Connecting you with reputable property management companies if you decide to rent.
- Negotiations: Representing your best interests during negotiations with buyers or tenants.
- Legal and Tax Guidance: Providing referrals to trusted legal and tax professionals.
Let’s Explore Your Options Together
Navigating the complexities of inherited property can be overwhelming. At Hilary Dunlavey Homes, we’re here to provide the support and guidance you need. Contact us today for a personalized consultation and let’s discuss the best course of action for your specific situation.