What should I do......?

Question

My brother and I inherited a piece of land from my grandfather when we were kids. Where the land is located, it is not good for growing crops and it is not good for roaming cattle. Hardly anything will grow there. There is a small house on the land, that within the years has compiled a number of problems. We have had a few renters over the years that have either stopped paying rent (and were evicted) or were supposed to fix parts of the house for exchange for living there (and that wasn't completed either!). Needless to say, the house will depreciate more if we don't do anything to it.

The problem is, is that the land was my father's family homestead. This makes me hesitant to sell it. However, the land has been nothing but a problem since we got it, I don't know if we can get another renter in there, or even generate enough to be effective in fixing it, or even paying the taxes next year. The land is not going to bring much especially after taxes and then splitting the money in half.

Any advice please!? What do I do?

Answer 1

Sounds to me like you have all the right reasons to sell it. Is it worth holding onto for any other reason, other than "it's been in the family"?

How does the property make money, other than renting? Is it worth fixing it up?

Bad tenants can cause it to devalue, not depreciate. Depreciation is a non-cash charge taken against the revenues of the property that adjusts the basis a specific amount every year. Devalue is the the potential sale price decreasing.

Try selling to a family member first. If no one wants it, find someone outside the family who will.

Is there someone else in the family that have a desire for the property?

Answer 2

Sell the land and insist on using a closing agent/attorney/title company to do the paperwork.  Instrtuct the closing agent to split the proceeds 50/50 between you and your brother.  If your brother gives different instructions to teh closing agent, then the agent will not disburse the proceeds from the sale until it receives identical instructions from both you and your brother.  If it does, you can sue the closing agent for breach of fiduciary duty.

Answer 3

My 2 brothers and I inherited Grandpa's house in Tucson.  We kept it for 6 years for sentimental reasons but one bad tenant made us decide to sell it.  That worked ok.  Then when Dad died we inherited his Tucson house.  This one caused friction.  I wanted to sell.  2nd brother wanted to board it up and keep it for 10 years in case the land became valuable. 3rd brother wanted to rent it out.  We squabbled and i worried that it would pull us apart.  i finally convinced them that it wasn't fair for them to make me keep the house.  We sold it.  The realty boom hit Tucson 10 months later.  Dad's house doubled in value.  I should have listened to my brothers.

There is no easy answer.  But if your brother swindles you, just let it go.  

Answer 4

The Ol' homestead or not...better to part with it.  It doesn't appear as if you or your brother have any interest in doing anything with it.  Sell it as "A Perfect Hideaway" and you'll get a lot of bites.  Better that you and your brother get something out of it now while you can both do something with it.  We can't hang on to something just for "sentimental" reasons.  There was a time that we could but now EVERYTHING costs.

Sell and split the money.  I'm sure you'll both put that to use more.

Answer 5

You and your brother spend 1/2 day visiting 3 real estate brokers located close to the property and just ask what's it worth.  They will give you more information than you ask so just say you are "fact finding".  

Then you and your brother go to lunch alone and discuss it.  You have to separate the emotional attachment and make a business decision, or not and decide you want to keep it for personal reasons.  

Whatever you decide on that afternoon stick with it.

Answer 6

any chance there's oil or gold on the property?  if not, i would sell it and move on.  it sounds like it's a headache for you.  land appreciates and buildings depreciate so the land might be worth more than you think.  ask a realtor what you can get for it and then decide.

Answer 7

It depends how far it is from you... Whether you might want to turn it into a vacation home to share with your brother... Whether you can afford to fix it up enough so as not to have it fall apart... Whether it is big enough to hunt on...

Personally, I wouldn't depend on it as rental property. I would only keep it if I could afford to pay for it fully and use any rental income as a bonus. If there is hunting/fishing nearby you can rent it to them on a seasonal basis.