When my dads mother died, he wanted to keep the home so he paid off his other siblings in order to keep the house. Now my mom and dad are in a middle of a divorce. My dad seems to think because it was an inheritance he considers this separate property. Because he had to pay his siblings off, is this now considered community property?

... Because he had to pay his siblings off, is this now considered community property?

Assuming that he paid his siblings off when he was married to your mother, yes. His share which he inherited from his mother might be pre-marital, non-community property, but the siblings' shares (now his) would not be.

I would ask why you as a child to them, are caring or ( and I hope not) interfering or getting involved in their divorce. Children ( of any age) need to stay out of it, not take sides and let them fight their own battles in divorce court.