Table of ContentsMany individuals find themselves in a situation where they have inherited real estate but are unsure of what to do with it. If the inherited property becomes vacant, it's crucial not to neglect it but instead focus on effective management and finding solutions for its future. In this article, we will explore how to manage inherited vacant real estate, discuss the drawbacks of leaving it unattended, and provide potential solutions for the future. Please use this information as a reference.Call or email us here >>Managing Inherited Vacant Real Estate in JapanWhen you reside in a property, you naturally take care of it and ensure its cleanliness. However, even if the property becomes vacant, neglecting regular maintenance can lead to gradual deterioration. So how should you manage an inherited vacant property? There are two primary methods: self-management or entrusting it to a property management company. The decision should be based on factors such as the cost of maintaining the vacant property and its proximity to your location.Self-ManagementIf the vacant property is located nearby, managing it yourself can help reduce costs. By visiting the vacant property once or twice a month and regularly attending to its needs, you can keep the house in good condition. Effective management of vacant properties involves the following:VentilationWhen you visit the property, ensure to ventilate the rooms by opening the windows. Stagnant air can lead to moisture accumulation, which can result in termite infestations, rotting, and mold growth. Opening the windows allows fresh air to circulate and release excess moisture, extending the lifespan of the inherited vacant property. Pay special attention to areas like closets and shoeboxes, as they tend to accumulate moisture.Run the waterRunning water through the plumbing system is essential to prevent rusting and pipe bursts. If the water is left stagnant, it can lead to rust and foul smells in the drains. During your visits, make sure to run the water for about 1-2 minutesCleaning It's important to clean both the interior and exterior of the inherited vacant property. If there is a garden, proper maintenance is necessary. Unattended weeds and trees can attract pests, and overgrown vegetation might encroach upon neighboring properties. Regularly clean the property, prune trees in the garden, and use herbicides to prevent any issues that could disturb the neighbors.Entrusting it to a Property Management CompanyIf the inherited vacant property is located far away or you are unable to manage it personally, it may be best to seek the services of a property management company. These companies specialize in the management of vacant properties. They can provide services such as regular inspections, ventilation, water flow checks, and cleaning. Although there will be a cost associated with hiring a management company, it can provide peace of mind knowing that professionals are overseeing the property.Disadvantages of Leaving an Inherited Vacant Property UnattendedLeaving an inherited vacant property unattended can lead to several disadvantages, including:Decrease in Asset ValueOver time, the value of a property naturally decreases. However, leaving a vacant property unattended further accelerates its deterioration. Neglected properties are susceptible to issues such as:termite infestationsmold growthleaksrusted pipesdamage caused by rain entering through windowsRegular inspections and maintenance are necessary to mitigate these issues and preserve the property's value.Owner LiabilityThe owner of a building is legally responsible for any damages caused to others due to defects in the installation or maintenance of the property, regardless of fault. For example, if a roof blows off during a typhoon and injures someone, or if a wall collapses and harms passersby during an earthquake, the owner can be held liable. Neglecting an inherited vacant property increases the risk of such incidents, highlighting the importance of proper management or considering alternative options.Solutions for Inherited Vacant PropertiesInherited vacant properties present various challenges and risks. Leaving them unattended comes with significant disadvantages, so it's essential to explore potential solutions. Here are three possible approaches to address the issue of inherited vacant properties.Sell the PropertyOne solution is to sell the inherited vacant property. By doing so, you can eliminate the hassle and disadvantages associated with managing it. Selling allows you to generate profits from the sale and avoid costs such as maintenance, property taxes, and city planning taxes. There are different methods to consider, such as selling the property as-is, dismantling it and selling the vacant land, or renovating it before selling. If you choose to dismantle and sell it as a vacant lot, some local governments offer subsidies and assistance, making it worthwhile to inquire about such opportunities.Donate the PropertyAnother solution is to donate the inherited vacant property to the local government. While this option may not be financially profitable like selling, it relieves you of the burden of ongoing maintenance costs. However, keep in mind that not all municipalities accept property donations, so it's important to verify the requirements and procedures. Additionally, transferring a vacant property to someone else is also an option, but be aware that it may be subject to gift tax implications for the recipient.Rent out the PropertyIf you prefer to retain ownership of the inherited property and address the ongoing maintenance costs, you can consider renting it out as a rental property. While this option may initially require some renovation expenses, renting out the property can provide a steady rental income to cover maintenance costs. It's important to ensure proper property management and tenant screening to avoid potential issues.Summary In this article, we have discussed the management of inherited vacant properties, the drawbacks of leaving them unattended, and potential solutions. Neglecting an inherited vacant property can result in a decline in its value and potential designation as a specific vacant house. To determine the best course of action, it is advisable to engage in discussions with other heirs and avoid leaving the property unattended. Whether you choose to sell, donate, or rent out the property, taking appropriate steps will help you effectively manage the inherited vacant property and make informed decisions.