First, we’re so sorry for your loss. This can be a very tough time for many reasons… especially since property ownership can be challenging at the best of times.
You may be thinking, “I inherited a house in DC, what do I do next?” Should I rent it? Should I sell it? If I sell it…how should I sell it?”
Well, there are tons of options open for you. This article will give you a few tips to help you navigate the process and make the best decision when it comes to that inherited property.
[Note: If you inherited a house in DC and need to sell immediately, we can help you! We’re seasoned homebuyers who specialize in the DC market, and we’re looking to buy several houses in DC each month and can close quickly!]
You Inherited A House in DC, So What Do You Do Next?
Here’s a few important considerations to help you make the right decision:
1) Pay Off The Mortgage – If There Is One.
As obvious as this may sound, if you inherited a house that has a mortgage, you need to pay off the mortgage if you decide to keep it. Some banks will allow you to assume the loan, while others may force you to refinance into a new loan. But renting your house in DC may not be for you if you don’t qualify for a new loan.
2) The investment is only as good as the manager.
If you’re like some people who’ve inherited a DC house, you may want to turn it into a rental for passive income. In all honesty, that’s a great strategy to put some extra cash in your pocket, but if you do decide to rent it out, just be prepared to manage the property and the hassles that go along with it.
[Note: You can always hire a professional to help you deal with brokers, maintenance, tenants, rent collection, and all the other nuances of property management.]
3) Property ownership costs money.
Most houses in DC are old and outdated…and many home renters are looking for updated homes to live in nowadays. This means you’ll probably need to make some major improvements to the property if you’re looking to rent it out.
We recommend hiring a professional property inspector if you’ve inherited a house in DC and you’re deciding to rent it out. They’ll be able to give you a detailed rundown of what you’ll need to do, along with the estimated costs. We encourage you to do this because surprises can be very, very expensive!
4) Selling A DC House for top dollar will cost money.
If you don’t want to deal with making repairs, updating the kitchen and bathrooms, and overall cleanup in general, don’t worry. We buy houses in DC fast for cash, regardless of the condition.
5) If the market will continue to grow faster than your other options, hang on to 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. 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) Don’t Forget About Uncle Sam!
There are major property and income tax consequences that will dramatically impact the cost of owning your investment. There are also tax consequences when you sell your house. We don’t understand it either… So if you’ve inherited a house in DC, just make sure you talk with tax and legal professionals before you take action to ensure you’re making the right choice financially.
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 at the same time – capturing the best of both worlds. These kinds of deals can be complicated, but with our experience in real estate investing, we can help you structure the transaction this way!
8) Compare a few scenarios.
We recommend looking at your options if you have time on your side. We can help you determine prices for any property in DC – if you sold it today in As-Is condition, what you’d expect to get if you fixed it up and sold it, and the projected value of keeping it as a rental (along with the costs).