Should You Turn That Inherited Property Into a Rental? Here’s What to Consider
Welcome! Eddie here with VP Property Management. Today we’re diving into a question we hear all the time: “Should I turn my inherited property into a rental?”
The answer? It depends—but for many people, the answer leans toward yes, especially if you approach it the right way (and ideally, with a great property management partner).
Here’s why keeping your inherited home as a rental might just be one of the smartest financial moves you can make.
1. Immediate Cash Flow, Day One
Many inherited homes are paid off—or close to it. That means you’re not burdened by a mortgage, which is typically the biggest cost in rental ownership. With no mortgage to pay, every dollar of rent collected (minus taxes, insurance, and maintenance) goes straight into your pocket. That’s real, instant cash flow—something many investors spend years trying to build.
2. Low Carrying Costs = Easier to Hold
Even if it takes a little time to find the right tenant, you’re not racking up heavy holding costs like you would on a mortgaged property. You’ll still need to cover utilities, taxes, and insurance, but without a loan payment looming every month, the pressure is much lower. That breathing room gives you flexibility to make smart long-term decisions.
3. Solid Structure, Minor Updates
In our experience, inherited homes are often structurally sound, even if a little outdated. You might need to update paint, flooring, or appliances—but the foundation, roof, and mechanicals are usually in great shape. A few thoughtful improvements (like granite countertops or modern lighting) can boost your rental value significantly, without requiring a full renovation.
4. Built-In Equity + Tax Benefits
Holding the property as a rental lets you keep the equity—and benefit from potential appreciation over time. Plus, you may be eligible for depreciation and other tax deductions, which can improve your net returns. Always check with a tax advisor, but this angle alone is often enough to tip the scales in favor of holding the property.
5. Avoid Self-Management Burnout
Now, let’s be real. If you plan to self-manage, we’ve seen too many people sell the property within a year. Why? It’s time-consuming, stressful, and often more complicated than expected. If you're not experienced or fully committed, managing tenants, maintenance, and rent collection can quickly become a burden.
That’s where we come in.
At VP Property Management, we specialize in making rentals truly passive for our clients. We handle everything—from tenant screening and rent collection to maintenance coordination and financial reporting—so you can enjoy the income without sacrificing your time or peace of mind.
6. Co-Inheritance Considerations
If you inherited the property alongside siblings or other family members, things can get trickier. Not everyone wants to be a landlord. In some cases, one heir may need to buy out the others—possibly requiring a refinance. We recommend having open discussions early, and if needed, connecting with a legal or financial professional to navigate shared ownership.
7. Run the Numbers With a Pro
Before you make a final decision, talk to a local rental expert. Get a professional rental analysis to determine how much the property could realistically earn. Compare that to current market value, potential repairs, and your own long-term goals.
At VP Property Management, we offer free rental analyses and strategic consultations to help you make the smartest decision—whether that’s renting it out, selling it, or something in between.
Thinking of Keeping That Inherited Property? Let's Talk.
If you’re sitting on an inherited property in the Kansas City area and wondering if it could become a cash-flowing rental, give us a call. We’ll walk you through the numbers, the pros and cons, and what it would look like if we handled everything for you, even getting the house ready for rent.
📞 Call us today at (816) 378-0007
