First, we’re so sorry for your loss. This can be a very challenging time for many reasons, and dealing with property ownership is real tough at the best of times.
You’re thinking, “I inherited a house, what to do with this house?” Should I rent it? Should I just sell it? How should I sell it? What do I need to do to sell it or rent it?
Tons of options open for you, but…
… we can help.
We’re seasoned investors in Metro Detroit real estate, and we’re looking to buy several houses each month in the Metro Detroit Michigan area. Every month we get calls and messages 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 through the process and decide what’s best for you and your family.
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 house doesn’t have any outstanding mortgage payments.
It might sound obvious, but it’s crucial to ensure that the previous owner had cleared any loans or mortgages on the property. Of course, unless it’s completely paid off already, which would be awesome! If there is a mortgage, there are a couple of options. Some banks might let you take over the existing loan, while others could require you to refinance. Just be aware that if you don’t qualify for a new loan, renting the house out might not be feasible.
2) The key to a successful investment lies in effective management.
If you’d rather not deal with the hassle of maintenance, tenant issues, collecting rent, and all the nitty-gritty details that come with property management, it’s worth considering hiring a professional. Alternatively, if managing the property seems like it would align with your goals, keeping the house and renting it out can be a fantastic strategy. Just make sure you’re mentally and physically prepared to handle the responsibilities and challenges that come with tenants and repairs, okay?
3) Owning a home comes with financial responsibilities.
It’s rare to see a building that’s been perfectly maintained. Most inherited houses need some extensive improvements.
Let’s be real – most inherited houses are likely to need some substantial repairs and improvements. It’s wise to bring in a professional property inspector who can give you a detailed assessment of what work needs to be done in the next few years, along with estimated costs. Trust me, unexpected surprises can burn a hole in your pocket. Oh boy, you don’t want to go there…
4) Selling a property for maximum profit requires investment.
If you don’t wish to deal with repairs, kitchen and bathroom updates, landscaping improvements, and overall cleanup, don’t worry. We purchase inherited houses for cash, in the condition they’re in. We buy Metro Detroit houses for cash, as-is.
5) If the real estate market is growing faster than other alternatives, consider holding onto the investment.
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, you should. For instance in 2023 the total existing-home sales dropped 1.5% from November to December, marking the eleventh consecutive month of declining sales, and down 34% from a year ago, per NAR.
However 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) The government gets a share of the profits.
Remember to consult tax and legal professionals before taking any action regarding your inherited property. There are significant property and income tax implications that can greatly impact the cost of owning your real estate investment.
7) Explore all available options.
In certain situations, we may be able to assist you in structuring a seller financing deal or a lease-option agreement, enabling you to both rent and sell the property simultaneously – offering the best of both worlds. These types of agreements can be complex, but our experience in Metro Detroit investments can guide you to success.
8) Compare different scenarios.
We’ll help you determine prices for any house in the Metro Detroit area. This includes the price you could sell it for today without making any improvements, the highest price the market can bear, and the projected value if you decide to keep it as a rental (alongside associated costs).