By Michael Edlen
Special to the Palisades News
It will be necessary to decide what to do when inheriting a home, such as when a family member has passed.
There are several alternatives to evaluate before making important decisions. You may have become a trustee who then is responsible to other family members and possibly others who have some financial interest in the property. Perhaps you have been told what your parents’ wishes were and if there are any specific requests to be honored.
When setting up a family trust that will then become the responsibility of one of your children, it is worth considering some of the options specific to the inheritance of property in advance. It can be important and helpful to make any wishes clear to the one who will become the successor trustee upon your passing.
There are many options that the family may wish to consider once the process of inheriting has been completed. These would include moving into it, selling it, doing some updating and then selling it, selling it to a developer strictly “as is” or leasing it.
If one or more of the family members would like to retain the home, there may be several ways this could be facilitated, depending on the family’s resources and other factors.
It can be beneficial to meet with a financial advisor to compare some of the options for the use of asset funds and to also compare with alternative investment opportunities.
An experienced local real estate agent can help in the decision-making process as well.
He or she can do a professional analysis of the potential market value as a sale or a lease. The agent can also recommend which home improvements would have a good return on investment for the family when it is sold.
Some agents may also provide added services such as coordination of clearing out the house and preparations before the beginning of marketing. For example, our team often helps facilitate painting, carpet cleaning or replacement, landscape upgrading, and professional house and window cleaning. We have even been involved in getting people to help with organizing of personal property in the preparation stages.
In some cases, the family decision may be to make every effort to retain the property for either present or future family use. If one heir will be occupying it, various alternatives can be discussed so arrangements are made to fairly compensate other heirs. If a sale decision is postponed, we have found some families prefer for us to arrange for a one- to two-year lease term. This provides cash flow to the heirs immediately, and they can take time to decide on long-term plans.
Most family or trust heirs decide to just sell the property. Others prefer to invest in some upgrades before selling, to maximize the family return on sale. If that course of action is being considered, it is highly advisable for the family to consult with a local real estate expert before making decisions because there is greater or lesser added value by what is invested in the upgrade.
Michael Edlen is a certified Seniors Real Estate Specialist. Call (310) 230-7373 or email Michael@MichaelEdlen.com.
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