Whether through direct purchase or inheritance, homeownership represents a significant and lengthy financial commitment. Homeowners are responsible for various expenses, including taxes, insurance, maintenance, landscaping, HOA fees, increased utilities, and more. Compounded with the other “growing pains” of adulthood (and parenting), it can be a lot. However, many people inherit homes (or land) in the aftermath of a loved one’s passing. And while it can be a great gift, it can also bring hardship.
When to keep grandma’s house vs selling it.
We’ve all heard the sentiment “Don’t Sell Grandma’s House,” but what exactly does that mean? And more importantly, how can we ensure that we actually don’t have to sell our family assets?
The sentiment “Don’t Sell Grandma’s House” is more than just a financial strategy and symbol of generational wealth. It’s a powerful emotional tie to our ancestral properties–it’s where we have fond childhood memories gathering with our siblings, cousins, and neighborhood friends. It’s our foundation, the place we often found our roots and replanted them back into the communities we grew up in. It’s another way we’re able to fight back against big corporations and governments who will attempt to gentrify or bulldoze their way through another Black community. This emotional connection is what makes these properties more than just houses, but a part of our family’s history and identity.
Despite all of that, keeping Grandma’s house (or a family home in general) isn’t as easy as it seems. The decision to own or sell an inherited home depends on several factors, including the house’s condition, location, evaluation of any debts associated with the home, and a clear economic plan for its maintenance.
While it’s ideal to keep a family home, sometimes we just aren’t prepared to do so due to a lack of planning, resources, and knowledge. The financial burden of maintaining an inherited home can be substantial, and without proper planning, it can lead to regrettable decisions, such as selling a home with sentimental value. This is a storyline that resonates with DC native Michelle Peters, who inherited her grandparents’ house in Washington, DC, in 2011, following the passing of her Grandmother. A home that had been in her family since the 80s.
“I didn’t have any knowledge of what homeownership looked like,” she shared. “I didn’t know about the upkeep of things like taxes, which increased from roughly $700 to a couple of thousand due to the construction of the DC Nationals Stadium. The home was also crumbling. While I do regret the events that occurred, I wish I still owned the house. At the time, I was making $13 per hour. Homeownership wasn’t a feasible financial decision for me.”
Leave behind a blessing, not a burden.
The last thing an inherited home or property should bring about is unnecessary stress or financial strain. While designating who gets the house is excellent, we should also ensure that we’re leaving behind financial assets that can help with the transfer of ownership, taxes, and other related matters. This is just one way to ensure the home stays in the family without being a burden.
Ohio homeowner Serena Davis inherited a second home in Georgia after her mother’s unexpected passing in November 2023. Although a will was in place, there was only a verbal discussion about what to do with the house. While her sister’s preference was to sell the home, both Davis and her mother wanted to preserve their family’s history and property.
“At times, I want to sell because I am dipping into my savings to keep both homes current,” Davis shared. “But my great-grandmother built this house in 1959 using her income as a dressmaker in NYC. I want to honor her sacrifice and her story by holding on to the house–it’s a little piece of generational wealth to pass on to my kids.”
These scenarios are not uncommon for NC Realtor Rebecca Bunn, who has been approached by numerous families who need to sell the homes they’ve inherited. Something she often sees is families who do not have a will or trust in place, resulting in the house having to go through the probate process, which can be lengthy and time-consuming. When this happens, the bills do not stop; the mortgage, taxes, HOA fees, insurance, and maintenance costs all continue to grow. Bunn says that in these unfortunate situations, properties often fall into disrepair, losing equity and value, and in some cases, even face foreclosure. As a result, instead of creating generational wealth, the asset becomes a financial and emotional burden.
However, with proper estate planning, this stress can be alleviated, as Bunn shared, providing your loved ones with a sense of security. When families create a trust that houses their assets, they leave clear instructions that empower their loved ones to make decisions without confusion, delay, or conflict. In many ways, she says, a trust allows us to “make decisions from the grave,” ensuring our wishes are honored and our family members are spared unnecessary stress.
Before you sell, look for help.
If you find yourself in a situation where you’ve inherited a property and are unsure of the best course of action, consider seeking professional advice. A financial advisor, estate planner, or real estate professional can provide personalized guidance based on your specific circumstances.
In some cities, Community Development Block Grant (CDBG) funds are available to help families who are owner-occupants. This means you plan to use the inherited home as your primary residence. These funds can sometimes be used to make necessary repairs and preserve the property. These community programs can provide much-needed support and resources to families dealing with the financial and maintenance challenges of inherited homes, offering a glimmer of hope in what can be a daunting situation.
Other programs, such as the Heirs Property Relending Program (HPRP), provide financing to help those who have inherited agricultural lands. The HPRP offers low-interest loans to assist with various needs, including clearing a property title, covering appraisal costs, or financing the purchase of land from other heirs.