Hi everyone, I’ll try and keep it short, just seeking some insight as my head is a mess with everything I have to deal with.
I lost my dad to covid about a month ago, it was a total shock and still is. He was 74, in quite amazing health but unfortunately unvaccinated and covid ravaged through him in 3 weeks. I’m 26 and his only child and he has no spouse. The only positive is he left me his main residence ($900k-1.1M) and a rental house ($125-200K). I’m planning on keeping the rental no matter what, it has very good tenants who’ve been there problem free 4 years, new roof, ac, etc and has a large RV garage separate from the lease I can rent out for $2-300 a month.
The house he left me is my issue. I still have 6 months before really having to make a decision when probate, etc is settled (I’m the executor, he has 25 active businesses and other beneficiaries on the will for residuary estate to deal with and enough personal property to fill a Macy’s, so I have a LOT to deal with the next 6 months). Before this I made around $24k after tax and I live in Nebraska with my long term SO, and lived very frugally and FIRE minded (I lost my job since I have to stay here in FL so long dealing with this, another blow, I liked my job). I’m in school for civil engineering (about 1/3 done, still in part time online classes this semester on top of everything else). The main residence was ladybird deeded to me so I already own it.
On his deathbed he told me he wanted me to keep the house and it made him so happy I was going to keep it. His house and the rental are on the spacecoast of Florida ( a hot area due to SpaceX, etc and the main house is riverfront so $$ is more stable, I would think). I grew up in this house and would like to keep it and live in it down the road, possibly.
The problem I’m struggling with is I’ve been reading that renting out a 1M$ house is a poor return, on top of even finding tenants willing to pay 4-6k a month. Total yearly bills would be around $17-20k (6k taxes, 5k insurance for hurricanes, electric, water, pest spray, couple other things). I plan on going back to Nebraska for at least the next 3-5 years so would have to manage it remote, another pain. So if I kept it, I would have to rent it out for that time, maybe longer.
Does it make any sense to keep the house? I don’t really have any religious beliefs (though my dad was a roman catholic priest lol) and don’t think he’s looking down on me, being upset I’m selling it when I said I’d keep it. But, I still get a bad feeling thinking about selling it when one of the last things he said to me was he was happy I was going to keep it, on top of the feeling I’d never be able to live in it again; Its a beautiful fairly big property and a gorgeous custom built home. But, I know I’d make a better return and have less hassle if I sold it and dumped most of the money into investments, etc. I could go to school full time with no loans, buy an affordable house in Nebraska, or anywhere I wanted, buy more rentals, etc. Logically it seems to make sense to sell it, I could be set for life. Renting it, it seems like I might get a small income every month and still have a big asset all expenses paid, but it could also could be destroyed, drop in price overnight, I have to deal with tenants, etc. It’s a very emotional decision for me so I’m seeking some logic. I don’t want to make a stupid decision and I know I have time, but I am also worried with the real estate market being hot hot hot here (and everywhere else it seems) if I wait too long to sell I could possibly be out a couple hundred thousand if the market drops.
Sorry for the ramble. Thanks for any advice, I really appreciate it.