Larry Birkhead has purchased a 10,000-sq.-ft., six-bedroom house in his hometown of Louisville, Ky., for himself and 21-month-old daughter Dannielynn, he tells PEOPLE.

Birkhead, 35, says the house, which has 40-ft. ceilings and is modeled after a Sicilian church, was never completed, needs a lot of work, and right now “looks like a haunted house,” but he loves it.

“When I walked in, I said to myself, ‘This is our home!’” says Birkhead.

He adds he might sell the Los Angeles house where he’s surrounded by memories of its former occupants - Dannielynn’s mother, Anna Nicole Smith, and half-brother Daniel, who both died from drug-related complications.

He adds: “There also isn’t any little friends for her to run around with - which makes the idea of Kentucky even more inviting.”

Anna Nicole Smith’s 20-year-old son Daniel died from an accidental drug overdose, according to the findings of a Bahamas jury - which recommends no criminal charges be filed.

The seven panelists deliberated less than two hours before returning the verdict on Monday, the Associated Press reports.

Daniel died Sept. 10, 2006, shortly after he arrived in the Bahamas to meet his new baby half-sister, Dannielynn, who was born in a Nassau hospital.

An autopsy whose results were announced in December determined that Daniel died as a result of a lethal combination of methadone and the antidepressants Zoloft and Lexapro.
- Stephen M. Silverman

A petition to have Anna Nicole Smith’s 18-month-old daughter Dannielynnn declared the sole heir to her estate was approved Tuesday by a Los Angeles judge.

In court papers filed in Superior Court Oct. 18, 2007, Howard K. Stern, the executor of Smith’s estate, sought to clarify Smith’s intentions in her July 2001 will, drafted five years before Dannielynn Hope’s September 2006 birth. (Smith died in February 2007.)

“We and Mr. Stern always believed that Anna Nicole never intended to disinherit her daughter,”‘ Stern’s lawyer, Bruce S. Ross, said after Tuesday’s hearing. “I’m pleased to say this chapter in the saga is closed.”

In addition to confirming Dannielynn as Anna Nicole’s sole heir, Judge Mitchell L. Beckloff’s ruling also establishes a trust on her behalf with Stern and Birkhead as its co-trustees, Ross said.

Tuesday’s ruling was first reported by TMZ.com.

Although Larry Birkhead, former lover of Anna Nicole Smith, has not updated his Web site since November - when Smith would have turned 40 - the home page underwent a moving makeover on Friday, the first anniversary of her death:

“Anna Nicole Smith

I LOVE YOU AND HOPE YOU ARE

PROUD OF OUR BEAUTIFUL BABY

GIRL. PLEASE WATCH OVER US

AND GUIDE US ON OUR JOURNEY

THROUGH LIFE. WE MISS YOU.

2-8-07

LOVE,

LARRY AND DANNIELYNN”