Quote:
Originally Posted by Gerbs
My brother moved out today.
What is the most optimal play for my mom who lives alone in a 2,300 sqft vancouver special? She could rent out the house for close to $6-7K/month upstairs and downstairs and downsize.
Alternatively, future planning would it make sense to ask if she wants to sponsor some $$$ so that my brother and I upgrade to bigger units that could accommodate her as her caretaker. She's 73, I'm not sure when people start taking care of their parents because my friends parents are all turning 50-60 lol.
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As a broad strategy, owning a house that you rent out, while you in turn rent somewhere else to live is generally not ideal. The reason is that one of the biggest advantages to home ownership is the fact it goes up in value tax free and you lose the ability if you don't live in a property that you own.
If the goal is to maximize inheritance, then ironically it makes more sense to actually sell the house, give the money to the kids, then have them buy bigger houses that over time will go up in value tax-free.
There are also advantages to this from the perspective of minimizing estate tax.
This is a very short and abbreviated answer but there is a longer and more thorough one. This type of planning is part of what my team does for a living. You can PM me if you want to discuss more.
-Mark