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 to do now?” Should I rent it? Should I sell it? How should I sell it?
Tons of options are out there for you, but…
… did you know that we here at Jamie Buys Houses can help?
We’re seasoned investors in Dallas real estate, and we’re looking to buy several houses each month in the Dallas TX area. Every month we get calls from those who have inherited a house and are looking to sell the house… so the info below will provide some tips to help you navigate the process.
I Inherited A House, What To Do Next?
Here’s a few important things to consider in order 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!), then 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, then renting the home out 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 in Dallas, TX 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 all the hassles that can go along with tenants and sudden emergency repairs as well as normal wear and tear / property upkeep. If the tenant suddenly has an overflowing toilet or the air conditioning breaks on a 95 degree day, and we all know in TX that happens, if you’re the one managing the property yourself, you’ve got to now figure out what to do and fast!
3) Property ownership costs money.
It’s rare to see a building that’s been perfectly maintained. Most inherited houses need some major improvements. Some of the major systems of the home are things like the roof, the heating and air units, hot water heater, plumbing which could include a septic system, electrical system, and even foundation.
Consider hiring a professional home inspector to give you a detailed rundown on what you’ll need to do within the next five years, along with estimated repair or replacement costs. Surprises can be very, very expensive. It’s good to be proactive so that you can avoid any big surprises!
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. We buy Dallas houses for cash, as-is.
5) If the market will continue to grow faster than your other options, hang on to the investment.
At Jamie Buys Houses, 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, then 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 any action. There are major property and income tax consequences that can dramatically impact the cost of owning your new investment, so do your due diligence before assuming anything.
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 the property at the same time – capturing the best of both worlds. These kinds of deals can be complicated, but our Sachse investment experience can help you win.
8) Compare a few scenarios.
We’ll help you determine prices for any property near Sachse – 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 associated costs).