Typically, adult children have three options when they inherit a house from their parents: they can move in, sell, or rent it out.
If you and/or your siblings have recently inherited a house and don't really know what to do, I'd suggest thinking through the following scenarios.
First, you or one of your siblings could move into the house.
You should anticipate an increase in property taxes as the current market value will be reassessed. Consider getting the home inspected for maintenance or security issues of immediate concern: they could help you estimate the cost as well.
If you and your siblings are co-owners and you want to move in, your siblings will need to be compensated, either through rental payments, buying out their share through mortgage or refinance, or making the house a share of the larger total estate.
Keep in mind when moving into the house, you will be accountable for property maintenance, taxes, and insurance payments, as well as legal obligations of homeownership.
The next option would be selling the house outright. If unsettled financial obligations exist, however, this could prove difficult.
All debts must be paid out of the sale of the property, and in some cases, the money owed through mortgages, taxes, judgements, and/or liens can be higher than the property price.
Also, keep in mind that it may take time, effort, and money to get the house into saleable condition, but once the house is gone, you are free from any responsibility on maintenance, taxes, insurance, or other legal matters.
Your third option, renting the property out, may generate passive income, though your rate and demand will depend on the property's location and condition. Make sure to check any city ordinances or homeowner association rules in the area for rentals.
A property manager may be a good idea, particularly if you don't live near the property. They can handle the leasing and management of the house. It is your responsibility to ensure, somehow, repairs and precautionary measures are met, and being a landlord leaves you with much liability.
In the end, inheriting a home can be great or sometimes a burden, and a lot of it depends on how you handle it. Weigh your options and consider talking with an experienced attorney who can offer a balanced perspective. If you don't have an attorney, please feel free to schedule an appointment with our law firm.