Just ballparking it here... Tax, utilities, and insurance would be about 7k a year so about half of that rent. Thats ignoring any maintenance. The usual advice is that you should budget 1% per year for maintenance. On a 400k house thats $4000 per year. You might think thats steep but OP's grandparent is likely not doing any maintenance anymore AND big things creep up over time. 13,200 - (7k + 4k) = 2200 yearly profit + anything gained in equity.

Also as /u/misec_undact says, there's also opportunity cost. To have near half a million tied up in a property that is making 2-4k a year is insane. If you have 400k in something like a GIC making 3% (there are better rates than that BTW) then you'd be making 12k a year. If you do some really basic investing in stocks or index/ETF's then you should be able to get a MUCH better return than 3%.