How to deal with having inherited a ‘hoarder house’

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Published Date 9/6/2023

If you ever watched those reality TV shows that showed you firsthand what hoarding was all about, you no doubt scrunched up your face at the thought of cleaning the house of the person being featured.

Piles upon piles of items fill rooms halfway to the ceiling in some, with no more than a pathway to get from room to room. It’s sad, and it’s the result of a disorder in the homeowner — a result of some trauma or poverty they had faced in their past. But what if you’re the one inheriting that property?

Realtor.com’s Sally Jones says inheriting any property can be a mixed bag. “On the one hand, you’re dealing with losing a loved one. And while you’re likely grateful for the inheritance, you also have to deal with many complex legal, financial, and tax matters.”

Then? There is the big cleanout — sifting through decades of a person’s belongings can be equal parts dreary and stressful. Now picture having to deal with a hoarder house.

In today’s market it’s not difficult to believe that a hoarder home in a coveted neighborhood can spark a bidding war — especially if it’s in a coveted neighborhood. But rehabbing an extensively damaged house could cost more than you can sell the home for. So what path do you take?

Jones had a few experts weigh in on what to do when you’ve inherited a hoard. First — assess the mess. Hoarding takes different forms. Some eccentrics resemble collectors whose acquisitions have gone wild—whether it’s designer fashions with the tags still on, baseball memorabilia, or movie toy collections.”If this is your situation, it could pay (big bucks) to call in an auction professional to assess the value of the collectibles,” says Jones.

But what about old files, bills, paperwork, and magazines? If the “collection” isn’t blocking doors or preventing you from easily walking through the home, the solution might be as easy as placing a call to a junk collector or a mobile shredding unit, Jones advises. But be sure to check to see if some of those books might be valuable first editions. That’s the time to call an auctioneer.

Now clean it all out. Better yet, leave it to professionals. Off Leash Investments’ Nick Giuioni says, “Dealing with inherited hoarder homes can present unique challenges. Hiring a professional clean-out service is often crucial. It ensures a thorough cleanup and lightens the emotional burden for inheritors.” But be advised that hiring pros can set you back “thousands of dollars,” adds Giulioni.

If the situation is severe, however, you may not have much choice. Another expert says, “We highly recommend calling in a professional company if the situation is severe. Reasons for this include proper disposal and recycling that conforms with local regulations and environmental guidelines as well as safety concerns regarding potential hazards.” How can you tell if this is needed? Signs include piles of garbage or food containers, no easy pathway through the house, animals and animal waste on the premises (plus rodents are having a field day as well), and the house has structural defects. Professional clean-out service personnel wear biohazard gear to clean out such a home safely.

Next, determine the market value. Don’t wait for a potential buyer’s appraisal. “If you’ve inherited a hoarder home, you’ll want to get an approximate valuation early. This way, you’ll know if you’ll recoup the costs of cleaning it out and fixing it up,” says Jones. Giuliani agrees. “Engage a licensed appraiser to objectively assess the home’s current and potential value.” And get a professional home inspector to identify structural issues.

Now to make it marketable. “Most hoarder houses suffer from deferred maintenance,” says Jones. “When a home is filled to the rafters with clutter, it can prevent the homeowner from seeing and fixing problems, and it might block vital mechanicals, like the HVAC system.” She goes on to say that a hoarder house can have problems that range from minor repairs to major structural issues. If your home’s issues are minor, take care of them before you put it on the market. This way, you’ll get the best possible offer on the house.

If extensive damage has occurred (such as water damage and associated mold issues) it will require remediation and renovation, and that could cost thousands of dollars. So how do you decide whether it’s even feasible to sell it “as is?”

“Depending on what your agent suggests is a reasonable sales price, you might not recoup the cost of significant repairs to a home in dire shape,” says Jones. “If this is the case, you could be tempted to put it on the market as is.” However, she advises that this approach is more challenging than it sounds, since it significantly reduces the pool of potential buyers. It could sit on the market for an extended period, leading to carrying costs, reduced profit, and ridiculously low offers. Giulioni advises that you consider offers only from buyers who have physically inspected the property since it reduces surprises and price renegotiations during the inspection window. That way the buyer has a more realistic expectation of the property’s condition.

You can also look for investors who deal in flipping distressed properties instead of trying to sell the home as is to a general market. That might result in a quicker sale, even if it requires significant cleanup and repairs. But don’t expect to get top dollar for a home that is not in marketable condition. These professionals make their money based on the arbitrage between the rehab cost and the change in value.

Realtor, TBWS

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