The True Cost of Inheriting a Home

Why Proper Planning Matters Now More Than Ever

The United States is undergoing the largest generational wealth transfer in history. Over the next few decades, baby boomers are expected to pass down approximately $84 trillion, including nearly $19 trillion in residential real estate.

For many heirs, this means inheriting a family home. While this can be a meaningful and valuable gift, it often comes with unexpected financial and legal obligations that can quickly turn it into a burden.

Inheriting a Home: A Hidden Financial Commitment

An inherited home doesn’t come without cost. In fact, Bankrate estimates the average annual cost of homeownership—including taxes, insurance, utilities, and maintenance—is over $21,000. These costs are separate from any remaining mortgage balance that must still be paid.

Common overlooked expenses include:

Property Taxes – May increase significantly if the home is reassessed.
Utilities – Must remain active to avoid damage and costly reconnection fees.
Maintenance & Repairs – Major repairs like roofing or HVAC can cost tens of thousands.
Homeowner’s Insurance – Must be updated or converted to vacant property coverage.

These expenses begin immediately—even while the home is in probate or a trust—and someone must be responsible for covering them.

Proactive Planning Makes All the Difference

With proper estate planning, families can reduce confusion, avoid disputes, and ease the financial strain of inheriting a home. Consider the following tools:

Revocable Living Trust – Avoid probate and define who is responsible for ongoing costs.
Transfer-on-Death (TOD) Deed – Allows direct transfer of the property where legally permitted.
Cash Reserves in Trust – Cover taxes, insurance, and emergency repairs during transition.
Right of Occupancy Provisions – Clearly define who may live in the home and who pays for what.
Open Communication – Prepare heirs for the financial realities of ownership.

Leave a Home—Not a Headache

An inherited home can be a powerful part of your legacy—but only if supported by a clear, well-funded estate plan. At Alperin Law & Wealth, we help families create custom plans that protect both property and relationships.

📞 Call us today at (757) 490-3500