Some Decisions to Be Made - Looking for Input

[luckydude]

Sorry for your loss, googily.

If you decide to take the house, make sure you get a date of death appraisal to establish a new cost basis for the house. You will also need to do this as part of your estate tax filing.

Also, even if your deceased parent's estate is less than the estate tax exemption amount ($5.25 million), you should still file a form 706 to claim the unused portion of the tax exemption amount (for portability), which could then be used by the estate of your father upon his passing.

Hope everything works out for you.

luckydude

 

[Walt34]

Sorry to learn of your parent's passing. Even when you know it's coming that doesn't make it easier.

Because of the emotional component to the house, I'd suggest keeping it and tell myself "wait a year (or two) and then make a firm decision". The decision to sell it is irrevocable and this way you won't feel like you have to make a decision "right now".

And if later you decide to sell it then you know you had time to sort through all the emotional issues.

 

[googily]

Sorry for your loss, googily.

If you decide to take the house, make sure you get a date of death appraisal to establish a new cost basis for the house. You will also need to do this as part of your estate tax filing.

Also, even if your deceased parent's estate is less than the estate tax exemption amount ($5.25 million), you should still file a form 706 to claim the unused portion of the tax exemption amount (for portability), which could then be used by the estate of your father upon his passing.

Hope everything works out for you.

luckydude

Thanks, Lucky. We did get the appraisal on both the house and her other property dealt with while we were out there, and my dad (who has a very good estate attorney and who is now trustee) is doing all the tax filing. It's likely some or all of the other property will have to be sold to fund the trust monies from Mom. A lot of moving parts....

 

[meekie]

Sorry for your loss. I think taking the house for now and having the neighbors continue to help out is a pretty good solution. I think there's too many emotions right now to make a final decision, and taking it for now and having the option to sell it later is a good choice.

I think it'll be nice for you to have it for a few years, as it sounds like it may be a nice place for you to visit a few times, even if you don't want to keep it forever.

 

[pb4uski]

googily,

First, I'm sorry for your loss.

On your question, when I think of second homes I think of opportunity cost as well as direct costs. If you have that $180k in cash rather than a house and invest it, let's say you can earn 5% on your $180k, or $9k. Add in the $3-4k of direct costs and you're talking about giving up $9k of income and incurring $3-4k of expenses to own the house - so $12-$13k a year in total for the benefit of using the house for the summer once you are retired. I suspect that you could rent a house in the area for the summer for less, so unless the house has sentimental attachment, I would lean towards taking the cash.

If you're still on the fence, perhaps you could take the house and rent it and decide later to use it or sell it.

 

[bssc]

Sorry for your loss.

I am also in the wait a year before deciding camp. I would also recommend going out for a month or two and seeing if the house is a fit for you long term.

 

[MBAustin]

Sorry to learn of your parent's passing. Even when you know it's coming that doesn't make it easier.

Because of the emotional component to the house, I'd suggest keeping it and tell myself "wait a year (or two) and then make a firm decision". The decision to sell it is irrevocable and this way you won't feel like you have to make a decision "right now".

And if later you decide to sell it then you know you had time to sort through all the emotional issues.

+1

 

[butterfly]

Sorry for your loss googily.

What a difficult situation to be in; it's a hard ask to seperate emotions from money.

Would you consider selling your current home and retiring and moving into the house for afew years yourselves? Just to be able to say goodbye and try out an area you think you will love may help with your eventual decisions.

With 1.2M + 850k + 300k extra cash inheritance house invested and a mortgage free home; sounds pretty good to me.

Good luck with your decision.

 

[googily]

Thanks again for all the replies.

Not going to sell our house here and move out there anytime soon--we love our current home (and other than it being on two floors, it's actually very friendly to aging in place, except for the cost of living!).

I do think, though, that I'm going to keep the house for a little while (a couple of years?), probably just to convince myself that it's not worth keeping over the long haul. But if I let it be sold now, without keeping it, it would always gnaw at me.

I very much enjoyed all the comments, though--great input from all sides.

 

[Dawg52]

Thanks again for all the replies.

Not going to sell our house here and move out there anytime soon--we love our current home (and other than it being on two floors, it's actually very friendly to aging in place, except for the cost of living!).

I do think, though, that I'm going to keep the house for a little while (a couple of years?), probably just to convince myself that it's not worth keeping over the long haul. But if I let it be sold now, without keeping it, it would always gnaw at me.

I very much enjoyed all the comments, though--great input from all sides.

Not a bad idea. I'm living in my mom's old house(she passed away in March). Trying to decide what to do myself. Keep her house and buy a 2nd home on the coast, or sell it and just move to a better area of town and rent when I go to the coast. If I go with the first option, I want to keep the house to have a place to come back to and visit. I figure I can sell it later if I tire of going back and forth.

So I'm also just taking my time. Looking at all angles to see what I want to do.

 

[caldwell666]

Sorry for your loss. Another thing to consider is homeowners insurance. Many companies will require a vacancy waiver be added to the policy to continue coverage with no one occupying the house. And, in my experience, the insurance company will only do a vacancy waiver for two years before they drop you.

 

[brett]

Take the money. Pay off your mortgage or invest. Why add an expense now? Wait until you are retired and then look for something.

 

[RobLJ]

Thanks again for all the replies.

Not going to sell our house here and move out there anytime soon--we love our current home (and other than it being on two floors, it's actually very friendly to aging in place, except for the cost of living!).

I do think, though, that I'm going to keep the house for a little while (a couple of years?), probably just to convince myself that it's not worth keeping over the long haul. But if I let it be sold now, without keeping it, it would always gnaw at me.

I very much enjoyed all the comments, though--great input from all sides.

I read this back a few days and forgot all the details. However, there is no downside other than the value risk, etc., in keeping it for a while and then making a decision in a year or two.
Some of this is highly personal; 20 years ago when the boys were in daycare, we were 4-5 years into buying our home here, and we were starting to accumulate income, my granddad was willing to sell us his Colorado cabin (which he built himself when I was six and I was with him when he was framing it) for a relative song.
We ran the numbers, realized we could manage it, but it would make things tight, and finally decided not to. It was the "right" decision, and my parents inherited and used (i.e., sold) it for their retirement, etc. I think the place in question for you is in Wyoming.
I still regret the loss, however--and it's in one of the prettiest areas in Colorado (at least to my mind).
We bought a second home/cabin on the Eastern side almost four years ago, which in many respects resembles his, although the view isn't quite as good and the river is 12 miles away, not 1/4 mile. It is an extravagance, and we may wind up selling it (or renting it) after we retire, especially if we retire to the PacNW and discover we aren't using it. But I haven't regretted it at all.
I think the answer here depend on your financial situation and whether you wind up going there enough to justify carrying it. But you can always sell it later, maybe not for what you can sell it now, if that's what you decide to do.