【Epoch Times, September 21, 2026】For elderly Chinese immigrants who have lived in the United States for three or four decades, the stage where real estate is most likely to encounter problems is no longer about how to buy or apply for a mortgage. It is when they hold onto properties until retirement, prepare to switch homes, or pass them on to the next generation that issues related to selling the property, taxes, repairs, or inheritance arise. Buying a house 30 years ago was their most successful investment; now, after 30 years, how to exit this investment has become the most challenging question.
In this article, I will attempt to delve into the problems encountered by “old houses” from the perspective of Chinese immigrants who have immigrated for thirty years.
Firstly, the most fortunate thing for elderly Chinese immigrants is likely that they bought houses early in the past, and after years of accumulation, they are now enjoying the high net worth of real estate! Moreover, the mortgage may have already been paid off long ago. For instance, if someone bought a house for $250,000 in California in 1995, it is now likely worth about $1.5 million!
However, as the saying goes, “The house is valuable, but cash is tight.” At this point, when the house seems to be worth a lot, it can actually become the most challenging asset to handle. The property may become a source of continuous troubles for the elderly homeowners due to a significant increase in its value, making them hesitant to sell it, burdened by high taxes, a too large house, costly repairs, rising insurance costs, children not wanting it, and not knowing how to pass it on. Below are the nine major problems that the elderly face after long-term property ownership:
The first issue is that after several decades, the property value on paper has increased significantly, but in retirement, what one needs is actual cash for living, not just the property value displayed on Zillow. They still have to pay annual miscellaneous expenses such as property taxes, insurance, utilities, HOA, roofing, HVAC, plumbing, landscaping, among others.
So, a typical situation might arise: “The mortgage has long been paid off, the house is worth $1.5 million, but I have to be very frugal every month.”
At this point, a common dilemma that elderly Chinese immigrants face is: should they sell the house? Or should they apply for a Home Equity Line of Credit (HELOC)? Or rent out a portion of the vacant space? Downsize to a smaller house? Or opt for a Reverse Mortgage?
Homeowners aged 62 and above may qualify for a Home Equity Conversion Mortgage (HECM) reverse mortgage guaranteed by the Federal Housing Administration (FHA). However, even with a reverse mortgage, property taxes, homeowner’s insurance, and home maintenance still need to be shouldered; failure to pay could even lead to default.
Therefore, if one intends to use the house for retirement income, it is essential to carefully consider all options and identify the most suitable approach.
After living in the United States for 30 years, how house prices have multiplied: The truth behind “using houses for retirement” – is it a trap or a savior? Passing the house to children is not as simple as you think #USRealEstateHotspots, September 19, 2026.
Assuming a purchase of $250,000 years ago and now selling for $1.5 million might seem like a profit of $1.25 million. But then, there are state income taxes, capital gains taxes, transfer taxes, selling costs, and other expenses to take into account.
Even under current federal tax laws, homeowners who meet the criteria for a primary residence sale can generally exclude up to $250,000 in capital gains. Qualified married couples filing jointly can exclude up to $500,000. Nevertheless, for homes held for 30 years with substantial appreciation, some gains may surpass these exclusion thresholds.
Hence, the thought of “since the house is mortgage-free, I won’t touch it” may arise. As a result, older individuals continue to reside in large houses with four or five bedrooms not because they actually need such a big house but because the costs associated with moving and taxes deter them from making a change.
Moreover, elderly Chinese in California face a specific common problem: property taxes are low, making them reluctant to move. This is due to the Property Tax Assessment system in California; the assessed taxable value of their long-held residences may be far below the current market value.
Therefore, older individuals ponder: “My house is now worth $2 million, but the property tax is still very low.” If they were to switch residences, “How will the property tax be recalculated?”
However, California’s Proposition 19 now allows qualifying homeowners over the age of 55 to transfer the tax basis of their primary residence to an alternative primary residence elsewhere in California under certain conditions, and this can be done up to three times.
This matter may seem minor but is indeed quite troublesome. When the Internal Revenue Service calculates the gains from selling a residence, it is not a simple matter of subtracting the selling price from the purchase price. Many capital improvements that qualify can increase the adjusted basis of the property.
What constitutes qualified capital improvements? Examples include a new roof, central air conditioning, room additions, electrical upgrades, major kitchen renovations, and more. These are expenditures that enhance the value of the property, prolong its useful life, or change its use, as opposed to routine maintenance like fixing leaks or painting projects.
Assuming $200,000 was spent over thirty years on improvements. The portion that meets the requirements may affect the cost basis, subsequently impacting the taxable gain. However, an issue arises when receipts for new roof installation or kitchen remodeling from thirty years ago cannot be located, rendering the verification of these costs impossible. This can increase the taxable percentage.
This is perhaps one of the most crucial matters for Chinese families to grasp. Many parents instinctively think, “Since the house will eventually be for the children, let’s add their names now.” Or they consider, “It’s easier to gift it directly to the children.”
Nevertheless, under the U.S. tax system, how gifted and inherited properties are treated concerning cost basis might be entirely different. The current general principle of the Internal Revenue Service implies that the cost basis of gifted property usually carries over from the giver, whereas inherited property generally has a cost basis based on the fair market value at the date of death.
For example, if parents bought a house for $200,000 and it is now worth $1 million, the implications of gifting it during their lifetime, adding names, placing it in a certain trust, or inheriting after death can lead to vastly different outcomes. Hence, the assumption that “it will ultimately belong to the children” can be problematic concerning property inheritance in the U.S.
These matters are even more complex because each family’s situation differs based on state laws, property ownership formats, marital statuses, and estate planning circumstances.
Many Chinese immigrant residences are not new; they might have been built in the 1970s, 1980s, or 1990s. When homeowners retire, their houses retire too. Various significant maintenance issues start emerging, such as with roofing, HVAC systems, piping, foundations, and more.
When retirees have only Social Security income and retirement pensions, sudden expenses of tens of thousands for repairs can cause great distress. A typical scenario is parents saying, “This house has been fine for 30 years,” while upon a home inspection, their children find themselves asking, “Why does everything need to be replaced?”
The experience of “living in the house for thirty years” may ironically become a hindrance to the homeowners. Many used to think, “Home insurance is just for renewal each year.” However, this is not necessarily the case now.
Data from the U.S. Department of the Treasury for 2018-2022 showed that homeowner insurance premiums increased at a rate 8.7% faster than inflation; in the top 20% of highest-risk ZIP codes for climate-related incidents, the average premiums were about 82% higher compared to the lowest-risk 20%, with a nonrenewal rate of approximately 80%.
Therefore, many elderly homeowners who have lived for decades may suddenly face scenarios like premium raises, higher deductibles, roof or vegetation improvements required, or even non-renewal of policies. This is especially crucial for those residing in high-risk areas such as wildfire zones in California, hurricane regions in Florida, or along the Gulf Coast.
This poses a particular challenge for retirees as their income is not as flexible as during their working years, making it harder to keep up with rising costs.
This situation resonates with many elderly Chinese immigrants. Thirty years ago, they bought a home to live in. When their financial situation improved, they purchased another for rental income. A few years later, they bought yet another. Upon retirement, they appeared very successful, with all three homes appreciating significantly.
However, they are now faced with challenges like tenant management, maintenance, depreciation, capital gains upon sale, depreciation recapture, property rights, estate distribution, and more when it comes to handling these properties. Particularly, if their children are doctors, engineers, or tech workers living in different states, they might simply not want to “inherit three old rental properties left by their parents and deal with toilets and tenants every month.”
The first generation viewed real estate as the safest wealth. The second generation, however, may see it as a troublesome illiquid asset. This can lead to potentially conflicting intergenerational dynamics.
Continuing from the previous point, the first generation often thinks, “Don’t sell the house, leave it to the children.” The children, on the other hand, might question, “Why not sell it and invest in ETFs?” The parents counter with, “A house is the safest option,” while the children respond, “I don’t even live in this state.” The parents suggest, “Keep it for rent,” but the children retort, “I don’t want to be a landlord.”
Hence, 30 years ago, purchasing a house was a shared goal for the couple. Thirty years later, how to deal with the house has become a source of family discord. It’s not that having real estate is bad, but rather that there are significant differences in views and values regarding wealth between the older and younger generations.
This contrast has become increasingly pronounced in recent years. An elderly retiree who has lived for 30 years with a mortgage-free home worth over $1 million may be perceived as a target by scammers, as they are seen as having considerable assets that can be accessed.
The Federal Trade Commission (FTC) specifically warns about Home Improvement Scams targeting elderly homeowners: scammers may approach offering roof replacement, renovation, solar energy, and convince homeowners to sign financing agreements for home equity at high costs, or even induce them to sign incomprehensible loans or property documents.
In FBI’s 2026 Elder Fraud cases, there are instances of victims being swindled out of over $500,000, even tapping into the equity of a fully paid-off house.
Therefore, for elderly homeowners, “protecting the house” now involves not just fixing the roof but also being vigilant in safeguarding property rights and home equity, as scams nowadays leave no stone unturned, often blurring the line between fake and genuine offers.
In conclusion, for elderly Chinese immigrants who have lived in the U.S. for three or four decades, their real estate holdings have likely accumulated considerable appreciation, but at the same time, they commonly face a triple test of “abundant paper assets, restricted cash flow, and drastic changes in tax and inheritance laws.” Thus, early planning is the core strategy to safeguard assets for the long term.
Another crucial aspect is how to communicate with the next generation. The older generation often perceives real estate as their greatest asset and safeguard, whereas the next generation may view it merely as one type of asset. Effective communication might not be about asking right away, “Do you want this house,” but rather beginning with, “What purpose will this house serve for the family in the future?”
Especially when it comes to property rights, trusts, gifting, inheritance, and tax matters, it is best to have estate planning lawyers, accountants, or tax advisors clarify the legal implications.
Above all, it is important not to assume that “leaving the house to the children” is the default answer. Sometimes, taking into account what truly benefits the next generation involves first ensuring if they want the house or the freedom of choice. ◇