Selling a Parent’s House to Pay for Assisted Living in Tampa

It usually starts with a fall, a diagnosis, or a phone call from a neighbor. Within a few weeks a family that had never discussed any of this is touring facilities, signing admission paperwork, and working out how to pay for it — while an empty house sits across town quietly costing money every day.

This is one of the most common reasons families call us, and it is also the one where getting the order of operations wrong is most expensive. Here is how it actually works in Florida.

Start here: who is legally allowed to sign?

Nothing else matters until this is answered, and it is what stalls most of these sales.

• A durable power of attorney that specifically grants authority over real property. Florida is strict about this — a general POA that does not expressly authorize conveying real estate may not be enough, and Florida POAs signed after October 2011 must meet particular execution requirements.
• A revocable living trust that already holds the house. The successor trustee can sell, no court involvement.
• Guardianship, if your parent no longer has capacity and no valid POA exists. This means a court petition, and it takes months. Families who discover they need guardianship after committing to a move-in date are the ones who end up in real trouble.

If your parent still has capacity today, getting a proper POA in place this week is the single most valuable thing you can do. It costs a few hundred dollars. Guardianship costs thousands and takes a season.

Understand the clock you are on

Assisted living in the Tampa area commonly runs somewhere around $5,000 a month, and memory care runs higher. That bill starts immediately.

Meanwhile the house keeps taking money out of the same pot: property taxes, insurance (which gets more expensive the moment the house is vacant), utilities kept on so pipes do not sit still, lawn care, and any HOA dues. A vacant Florida house is also exposed to storm damage and water leaks that nobody notices for weeks.

That combined burn rate is the real reason families move quickly. It is worth writing the number down so you are deciding with a figure in front of you rather than a feeling.

If Medicaid might ever be involved, talk to an elder law attorney before you sell

This is the part where well-meaning families cause themselves genuine harm, so please read it carefully.

Florida’s long-term care Medicaid program has a 60-month look-back period — five years of financial history are reviewed for improper transfers. The countable asset limit for a single applicant is $2,000.

The home itself is often treated differently from cash. It can be exempt where a spouse, a child under 21, or a permanently disabled child lives there; otherwise there is a home equity limit ($752,000 in 2026) and an expectation that the applicant intends to return.

Here is the trap. The moment you sell, an exempt house becomes countable cash. A family that sells to “have money available for care” can convert a protected asset into one that disqualifies their parent from benefits they were about to receive.

Sometimes selling is exactly right. Sometimes it is exactly wrong. It depends entirely on whether Medicaid is part of the plan, and that is a question for a Florida elder law attorney — before the house goes under contract, not after. One consultation is cheap next to a penalty period.

The homestead exemption trap nobody mentions

Your parent can generally keep their Florida homestead exemption after moving into a facility. What preserves it is the intent to return — and that intent does not have to be medically realistic. Continuing to pay the taxes and keeping their voter registration at the address supports it.

What breaks it is renting the house out. Under Florida Statute 196.061, renting all or substantially all of a former homestead for more than 30 days per calendar year, in two consecutive years, constitutes abandonment of the homestead.

So the intuitive move — “we will rent Dad’s house out to help cover the care bill” — can quietly cost you the exemption and the Save Our Homes assessment cap, and reset the property to full market value for tax purposes. Run that math before you sign a lease.

Capital gains: better news than most families expect

Families often assume a big tax bill. Usually there is not one.

The standard federal exclusion on the sale of a principal residence is $250,000 of gain for a single filer and $500,000 for a married couple filing jointly, provided the owner lived there two of the last five years.

And there is a special rule most people have never heard of. Under Section 121(d)(7), if the owner became physically or mentally incapable of self-care, they only need to have used the home as a principal residence for one year out of the last five — and time spent in a state-licensed care facility counts as continued use of the residence.

In plain terms: a parent who moved into assisted living three years ago may well still qualify for the full exclusion. Confirm it with a CPA, but do not assume the worst before you ask.

List it, or sell it as-is?

Houses in this situation share a profile. Someone lived there for decades. The roof, the HVAC and the electrical panel are original or close to it. There are forty years of belongings inside. Nobody in the family lives close enough, or has the time, to deal with any of it.

Listing with an agent will produce the highest gross price if the house shows well and you have time. But you have to clear it out, make repairs, stage it, survive an inspection period, and wait on a buyer’s mortgage — while the care bill runs every month.

Selling as-is to a cash buyer trades some price for speed and certainty. No repairs, no showings, no financing that can collapse at day forty-five, and a closing date you choose. Contents can stay where they are; we buy houses with belongings still inside, which for many families is the part that matters most.

The honest comparison is net, not gross. Subtract commission, seller-paid closing costs, repairs, inspection credits and every month of carrying costs from the listed price before you compare. Our side-by-side comparison works through the numbers, and how cash offers are calculated shows exactly how we arrive at ours.

A sensible order of operations

1. Confirm who has legal authority to sign. Fix it now if the answer is nobody.
2. Work out the monthly burn: care cost plus the cost of holding the house.
3. Ask an elder law attorney whether Medicaid is likely to be part of the plan.
4. Get a date-of-move valuation and ask a CPA about the Section 121 exclusion.
5. Make sure the house is insured for its vacant status — most policies change.
6. Then, and only then, decide between listing and selling as-is.

We buy these houses across Tampa Bay

We have bought a number of homes in exactly this situation — including from families coordinating it from another state. No repairs, no cleaning out, no commissions, and a closing date that lines up with the facility’s move-in date rather than a lender’s calendar.

We buy in Tampa, St. Petersburg and across the wider bay area — see where we buy. If the property was inherited rather than sold during your parent’s lifetime, read selling an inherited house in Tampa instead.

Ask for a no-obligation cash offer or call me directly at (813) 590-0763. If listing would put more money toward your parent’s care, I will tell you.

This article is general information about Florida law, Medicaid and federal tax rules, not legal, tax or financial advice. Medicaid eligibility and tax outcomes depend entirely on individual circumstances, and the figures cited change. Please consult a Florida elder law attorney and a CPA about your family’s situation before acting.

Written by Laura Spaulding, owner of Bee Lucky Home Buyers. Laura has been investing in Tampa real estate since 2016 and buys houses across Tampa Bay. More about Laura.