I have a family member who is now in possession of an inherited house, his plan is to rent it out and he seems to have some far fetched ideas on how easy it will be for him to sit on the property and sell it for double the current value in 10 years while also making steady cash on a house that looks like it hasn't been touched in 40 years. really appreciate any advice on how to try and talk him out of this. He was last a landlord in the late 80s and it did not end well.

ChrisHansen said:

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I have a family member who is now in possession of an inherited house, his plan is to rent it out and he seems to have some far fetched ideas on how easy it will be for him to sit on the property and sell it for double the current value in 10 years while also making steady cash on a house that looks like it hasn't been touched in 40 years. really appreciate any advice on how to try and talk him out of this. He was last a landlord in the late 80s and it did not end well.

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How is that far fetched? May be unlikely depending on the house, market, and his management skills, but not far fetched.

ChrisHansen said:

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I have a family member who is now in possession of an inherited house, his plan is to rent it out and he seems to have some far fetched ideas on how easy it will be for him to sit on the property and sell it for double the current value in 10 years while also making steady cash on a house that looks like it hasn't been touched in 40 years. really appreciate any advice on how to try and talk him out of this. He was last a landlord in the late 80s and it did not end well.

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lol username . . . start him off with this.

ChrisHansen said:

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I have a family member who is now in possession of an inherited house, his plan is to rent it out and he seems to have some far fetched ideas on how easy it will be for him to sit on the property and sell it for double the current value in 10 years while also making steady cash on a house that looks like it hasn't been touched in 40 years. really appreciate any advice on how to try and talk him out of this. He was last a landlord in the late 80s and it did not end well.

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Fix everything up front that needs it, especially big ticket items that may be due for a change.

Do market research on rents in the area & make a decision on where he wants to be.

There are groups who can help him do this right, providing insight that he may have missed in some of his "far fetched" ideas.

Good luck!

If he was a landlord in the 80s that mean he's already in his 60s....and he wants to "double" the value of this property to sell in "10 years" when he's in his 70s.

This has "but why" written all over it.

ChrisHansen said:

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I have a family member who is now in possession of an inherited house, his plan is to rent it out and he seems to have some far fetched ideas on how easy it will be for him to sit on the property and sell it for double the current value in 10 years while also making steady cash on a house that looks like it hasn't been touched in 40 years. really appreciate any advice on how to try and talk him out of this. He was last a landlord in the late 80s and it did not end well.

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My sister and I just sold an inherited house that we rented for a few years... For us in this specific scenario it worked out, but we had things going for us.

The house as free and clear and we had cash in the estate, so we fixed it up. In the end, most of the old house things were taken care of. Windows, roof, plumbing and sewer were all pretty well fixed up. We renovated the bathrooms and did a facelift on the kitchen and did paint and trim.

It was in a highly desirable area in a good school district. It never sat on the market for rent for more than a week or so. We had to put cash in a couple times for repairs, but at the end of the year we were cash flow neutral and last year we had money in the bank.

The downside is that its still a house so you have small things that have to get fixed and that takes time. You also have to deal with renters and that's always going to be a crapshoot. The two tenants we had were relatively ok, but it never ended up being passive income (when there was actually income at all).

The biggest lucky thing for us was that we held the house from 2019 to 2023, so we got our renovation costs back and accrued a bunch of equity in that time period. Counting on that kind of growth to happen again over the next 10 years is a bad bet IMO. If I inherited a house today, I would take the money and run.