Preparing to inherit properties in really bad shape. Advice?

Question

While I hope my parents live for many more years, my brother and I are well aware of the fact that someday we are going to inherit both our parents' house and another property that they own in a neighboring town. Both houses are unlivable (However our parents do live in one of the houses while the other is just full of junk.) and would need either complete renovations (inside and out) or tear-down-and-rebuild before anyone new could live in them. But my brother and I can't afford to invest in rennovations, plus it would be risky since we don't know enough about it, plus I live on the other side of the country. So are we doomed to inherit condemned houses and be forced to sell them at really low prices? Or is there a way to partner with a developer to co-invest in rennovating them and either rent or resell? I have no idea where to even begin, but any advice would be very welcome. Just want to be prepared for the inevitable.

Aaron W. · Answer

@Craig Starger Yes, there is a way to develop or co-invest these properties to renovate them. You just have to make sure these properties are in markets/locations worth investing in.  You can use these forums to find potential partners for these properties. You could also look for local commercial brokers who may be able to give you insight on whether these are desirable enough areas for investment.

Best of luck!

Chris Levarek · Answer

I'd say start listening to podcasts, read books and ask questions(specific) on these forums to be ready. You can build the network or team at the property location to be ready for that moment. You don't have to be there, just need to develop those relationships early. Relationships with property manager, contractors, lenders and agents.

Here's a quote that came to mind reading your post. “If you really want to do something, you'll find a way. If you don't, you'll find an excuse." - Jim Rohn

Happy Investing!

Marian Smith · Answer

@Craig Starger  Are your parents hoarders?  How old are the properties?  Next time you visit make sure the roofs are good on both structures and clean the gutters.  Ask to help sort and donate unused possessions in at least the house they are living in.  And inspect their house for water leaks in plumbing.  Repair all holes in building envelope.  Focus on making their house safe and comfortable and you will also be investing in your inheritance...and prolong their stay at home vs assisted living which is very expensive.  A habitable house, empty with a fresh coat of white paint, has a good chance of attracting a buyer willing to pay more than an investor.  Let the house run down and you will likely lose your parents earlier due to falls, etc as well as any inheritance of value.

Mike McCarthy · Answer

Unless you have a specific interest in renovating them, it’s probably better to just plan on selling as-is.

While it’s possible you’ll make more money renovating or rebuilding and selling, it’s also going to cost you time and effort, and unless it’s a career/investment direction you want to go, I doubt it will end up being cost-effective for you to partner with someone to do it. Or even if you had extra money lying around, basically you’re planning a flip, which is rarely worthwhile for the first house (or few) anyone does.

Gene Guarino · Answer

My friends Ben and Phillip at Mom's House, specialize in these types of properties.

I would HIGHLY recommend you find them online and reach out to them for their input.

Great guys.

Gene

Steve K. · Answer

@Craig Starger I’ll give you two million for each property RIGHT NOW. Not really, but seriously, if you need to sell in this market you’re in a good position.

Chris Pasternak · Answer

Talk to a Realtor in that area to talk strategy.  You want one that has sold places like these, someone familiar with investment property.  Maybe they're not as bad as you're thinking.  I talk to family members all the time that day it's horrible condition when really it's not that bad.  It's difficult for you to see as a family member sometime.  Objective Realtor point of view will help.

Jim K. · Answer

Yeah, you're.pretty much doomed. That is a primary acquisition path for a lot of local buy-and-hold guys.

Preparing to inherit properties in really bad shape. Advice?

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