Are you feeling uncertain about what to do with a recently inherited property? If so, you're not alone. Inheriting a house or any property can bring up a wave of mixed emotions, from nostalgia to financial concerns. This attachment often stems from memories tied to the property, especially when it holds a special place in your family history. Yet, for many, it may also represent financial stability or even an unexpected burden, adding more complexity to an already emotional decision. However, balancing emotional ties with practical choices is crucial to making the most of what your loved ones left behind. 

Inherited properties, whether single-family homes, townhouses, condos, or even commercial buildings, come with both potential financial benefits and substantial legal responsibilities. Owning such property involves costs like property taxes, maintenance, and possibly mortgage payments. According to a recent Charles Schwab study, around 75% of parents plan to pass their home on to their children. Interestingly, however, nearly 70% of heirs choose to sell rather than keep the property, preferring to liquidate for cash instead of maintaining it as an investment. 

Also read: What Is the Cost of Selling a House? 

If you're unsure about what to do with your inherited property, this blog offers options and perspectives to help you make a well-informed decision for a financially sound future. 

Steps to Take When Deciding on an Inherited Property 

Inheriting a property often comes during an emotionally challenging time, making decisions even more complicated. After a significant loss, grieving individuals may struggle with making choices related to the deceased's belongings and assets. However, inheritance can also be a turning point for financial growth and stability for you and your family. 

If you've received an inheritance and feel uncertain, here are key steps to follow: 

1. Consider Your Location and Accessibility 

Your location relative to the inherited property is essential when weighing the pros and cons of keeping or selling. 

Living Out of State or Country: Owning property far from your residence can be challenging to manage. Maintenance tasks are simpler when the property is nearby, allowing you to address repairs or inspections more efficiently. If you're not local to the property, consider whether you're prepared for the time, effort, and expense involved in long-distance property management. 

Frequent Travel Needs: If you choose to keep the property, be prepared for the possibility of frequent travel to handle property management tasks or meet with service providers. For some, the cost and time involved in managing a distant property make selling an appealing alternative. 

Home-buying companies like Offer4Homes buy property in as-is condition, saving time and stress in upkeeping the property. Furthermore, these companies offer cash directly and relieve you of these ongoing expenses. 

2. Evaluate the Property’s Condition and Potential Costs 

Inherited properties can sometimes come with costly repair and maintenance needs, especially if they've been vacant or neglected. Before deciding to keep or sell, assess the property's current condition and estimate potential future expenses. Here are a few considerations: 

Repair and Maintenance: Keeping a property in good condition requires regular upkeep, which could be costly if the property is outdated or needs significant repairs. Long-vacant properties might have issues like plumbing concerns, pest infestations, or foundation problems, which can all impact the property's value. Selling an inherited property needing extensive repair may save you from unexpected future expenses. 

Ongoing Expense: Even when unoccupied, a property incurs expenses like property taxes, insurance, and utility costs. Holding onto the property means committing to these yearly expenses, so consider whether you're financially comfortable with this responsibility. 

3. Assess Emotional Attachment 

Inherited properties often carry strong emotional significance, especially when family memories are attached. This can make selling a difficult decision. However, owning property also comes with financial responsibilities, from property taxes to maintenance. Some people may find that the practicality of selling outweighs the sentimentality of keeping the property. 

In cases where multiple beneficiaries are involved, open communication and seeking professional mediation can help avoid unnecessary conflicts and ensure a smooth decision-making process. 

4. Analyze the Financial Pros and Cons 

When dealing with inherited property, it's important to set emotions aside and evaluate your options from a financial standpoint. Holding onto an inherited property can provide rental income but also requires regular maintenance. On the other hand, selling can offer a significant cash infusion that can be directed toward other financial goals, like paying off debt, investing in another property, or enhancing your savings. 

Additionally, assessing the current real estate market is essential. Knowing the property's value and understanding local market conditions can help you gauge whether selling now could yield a better financial return than waiting. 

5. Understand Tax Implications 

One of the most important considerations in inheritance decisions is the tax burden. Although there is no federal inheritance tax on assets received from a loved one, tax implications exist for estates valued above $13.61 million (as of 2024). Additionally, if you choose to sell the property soon after inheriting it, you may be subject to short-term capital gains taxes. However, if you hold onto the property for more than a year, you'll be taxed at the long-term capital gains rate. 

Therefore, consulting with a tax professional is advisable to understand which taxes apply to your inheritance. This can also help clarify any exemptions or deductions you may be eligible for, guiding you toward a financially sound decision. 

6. The Ease of Selling to a Home-Buying Company 

If you're looking for a simple, quick solution, selling to a home-buying company can offer unique advantages. Companies like Offer4Homes take the emotional burden out of the process by providing a straightforward solution, which might resonate with those struggling emotionally with the property. By selling to such companies, you can receive an offer within 48 hours and close the sale in as little as two weeks. 

One of the main advantages of these companies is that they buy properties as-is, meaning you don't have to worry about repairs or renovations. This can be particularly beneficial for those who live far from the property or need to access funds quickly. Additionally, since the sale occurs without a realtor, you avoid commission fees, which can further increase your net gain. 

Also read: Selling a House: When and Why Cash Offer Matters 

Is It Worth Selling to a Home-Buying Company? 

For some, selling to a home-buying company like Offer4Homes may be the most practical option. These companies offer competitive prices and take care of all transaction steps, from valuation to closing. You won't need to worry about costly repairs or marketing the property, making it ideal for anyone who values a straightforward and stress-free sale process. 

Opting for a home-buying company can also be especially advantageous if you want to bypass the traditional real estate market, which can sometimes involve lengthy listing times and extensive paperwork.

Also read: What we buy at Offer4Homes?