How to pass down property without passing down problems
It’s summer, and we always enjoy hearing what our clients are up to with their friends, family, and long sunny days. A number of our clients own a second residence that carries significant sentimental value to the family as a whole, which usually entertains the question:
Should we keep this in the family?
Whether it’s the lake house, the cabin in the mountains, or the summer home at the beach, these properties carry not just financial value, but emotional weight—memories, traditions, connection. It’s a wonderful goal, but it’s also one that requires some intentional planning. Without it, the very gift that was meant to unite the family can sometimes become a source of conflict or burden.
We’ve walked through this planning process with a number of our clients, and today, we’re sharing the framework and questions we like to ask to help families differentiate between good intentions and a good plan.
Is It a Gift—or a Responsibility?
Before thinking about legal structures or tax implications, start with the big picture: Would passing on this property feel like a gift—or a burden—to your children and grandchildren?
Some practical questions to ask:
Can the next generation afford the ongoing maintenance, taxes, and insurance?
Will they be willing and able to share the responsibilities of upkeep and scheduling?
Is there clarity about who would use it, how often, and who’s in charge of decisions?
Some families choose to set aside a fund—either during life or through their estate—to help offset these ongoing costs. Others have candid conversations with their children about whether they should even keep the property at all.
Before you delve into the planning process, it's essential to have clear expectations regarding costs, usage, and commitments.
Is the Property Scalable?
A vacation property designed for a nuclear family may not work the same way for adult children, spouses, and grandchildren. A few things to consider:
Will the property accommodate a growing family over time?
Will everyone feel like they have fair access and ownership?
If family units are spread out, how much does it cost to travel to the shared property?
Is the location still practical or meaningful for the next generation?
Even if the property feels special now, it may not meet the needs or lifestyles of your children in 10 or 20 years. That’s not a failure—it’s just something to plan for ahead of time.
Should We Put It in Writing?
Documentation is arguably the best way to prevent conflict. Details can get surprisingly foggy when disagreements arise. You don’t need to make rigid demands, but it helps to document your intent and provide your children with both guidance and flexibility.
A few planning tools to consider:
Family Vision Statements or Letters of Wishes: Communicate the why behind your decision and your hopes for how the property might be used.
LLC or Co-Ownership Agreements: These can help define usage rights, maintenance responsibilities, and buyout options.
Trust Structures: For more complex estates, a trust may help ensure the property is maintained and passed on according to your wishes.
The goal is to reduce emotional uncertainty. Many adult children wrestle with the question, “What would Mom and Dad have wanted?” You can give them the freedom to decide what makes sense for their lives—while still honoring your legacy.
A Final Word: Intent and Latitude
It’s one thing to leave a property. It’s another to leave peace of mind with it.
By thinking through the long-term implications—financial, relational, and practical—you’re not just transferring an asset. You’re offering clarity, trust, and thoughtful stewardship.
If keeping the family property in the family is part of your plan, we’d be glad to help you think it through—together.