What is the ruling on not returning the amount paid by the buyer for the house after the agreement was فسخ (rescinded), especially given that the buyer utilized the house for 11 months, and is the amount paid considered a debt upon the deceased homeowner?

If the contract between the buyer and the homeowner is a valid sale contract, then the amount paid is part of the price, and the house belongs to the buyer. The buyer must pay the remaining price, and neither party has the right to annul the sale except with the consent of the other party (mutual rescission). However, if the contract is invalid, such as a loan in exchange for the exploitation of the house, then this is forbidden usury (riba). In this case, the buyer must hand over the house, and the homeowner must return the full amount, and both must repent from this forbidden transaction.