Buy out 1/2 for appraisal price in 2004??

[bAnGChOn1004]

I am buying my sister out of her half of the house we both inherited. The house was appraised when our mother died, about 5 years ago and she is demanding that I pay her based on the appraisal price, since she was courteous enough to give me a few years to buy her out. I agreed to do so, but she is now demanding I pay her rent for the past 5 years (I remained in the house after my mother died). There's no rental agreement and it was often brought up casually here and there, until just the other day. She says she's charging rent because she could have gained interest if I paid her 5 years ago, because she would've had the money in the bank, does that sound reasonable? The price I paid was a lot higher than what the house is worth now, PLUS I haven't charged her for any renovations (I had ALOT of work done), do I have to pay her the rent as well?

What is she entitled to? Am I being unreasonable?

 

[dee_dub]

It's a negotiation. You don't HAVE to do anything. You can negotiate something you can live with, or walk.

What's reasonable depends entirely on what you think is reasonable. Maybe you're happy to pay the 5-year-old appraisal price, which is a significant plus to her. You might consider paying interest at a reasonable rate. You might not pay rent since that was never part of the deal. Any renovations you've had done in the last 5 years would accrue only to your benefit in the event you buy the house, so it might not be fair to try to get a discount for those. Etc.

Consider what her alternative is. If you can't work something out, she can try her luck selling her half of the house on the open market, or sue you for partition and sale - in either case, she'll get 1/2 of what the house is worth now, and that's not good for her.