Handling a property of someone who has died is obviously an emotionally difficult experience, but can be further complicated if the beneficiaries have different opinions about what they should do.

This page outlines some of the considerations if you are a beneficiary, and need to decide whether to buy or sell.

You would then be faced with the questions of how to maximise your rent or your selling price. We can help with these too.

A good starting point is to understand exactly what probate is, so Ive taken the explanation from HMRCs website at http://www.hmrc.gov.uk/inheritancetax/intro/probate-process.htm

“Probate (or confirmation in Scotland) is the system you go through if you’re handling the estate of someone who’s died. It gives you the legal right to distribute the estate according to the deceased’s wishes. Inheritance Tax forms are part of the process even if the estate doesn’t owe Inheritance Tax.”

Obviously this is the responsibility of the Executor(s), but it can be very time-consuming for Probate to be granted.

Its not for me to give legal or tax advice, but should you be an Executor or beneficiary I would highly recommend that you seek the advice of a professional, but also to do some research of your own. Inheritance tax can be a serious problem, so do use the above link to HMRCs website so that you can get a broad understanding, or a detailed one if you are more interested and have the inclination to understand their explanations & cross-references.

Should you be the lucky beneficiary of a property either in full or in part, then you need to make a decision of what to do with it. This can be a very difficult time if there is more than 1 beneficiary because you will likely have different opinions & experiences. Arguments can ensue. These are emotionally draining and time-consuming, but any delay is ultimately costing you money unless property prices are rising very quickly.

If you agree to retain the property and to rent it out, then it is likely you will be inexperienced as a landlord. Whilst owning a property to rent out is an attractive idea, I believe that many landlords are “accidental”, and havent a clue about their legal & moral responsibilities, let alone how to manage it as a business. You can speak with local agents, but how helpful will they really be, and as you will see from the media and Shelter’s campaigns, there are a lot of rogues in the marketplace.

It is a really tough & time-consuming business, and NET profits, as opposed to the gross profits that tend to be quoted, can be marginal at best.

Conversely, if you decide to sell, how do you sell – agent, auction or private sale. For the purposes of this I will discuss Agents.

So, how do you decide who is a good agent? You need to be aware that some Agents are good to buy through (they are easy for buyers to negotiate lower prices with), and some are better to sell through as they negotiate hard on behalf of sellers (who are, after all, their clients).

Valuing a property is both a science and an art. Surveyors are professionals…at surveys…in my experience they know less than local agents about local values, even though mortgage lenders employ a surveyor to do a valuation. By their nature they are scientific, intelligent and thorough, but they are less likely to understand the vagaries of a marketplace and schooling etc where prices can vary from one street to the next for no apparent reason.

Before deciding to sell, I would make a strong recommendation; understand how quickly you NEED to sell. This will affect the actual price you will achieve. If an agent doesnt ask you this question then they are not sufficiently skillful. The price that you advertise at should be set according to your own timescale, and certainly not at a figure at which an agent “values” your property.

Any property is only worth what any individual is prepared to pay at any given moment in time.

So, if you need to sell within a month, your property will have a value of eg £180,000 because there will be dozens of people who would be prepared to pay this amount for it, probably in cash & without a chain, thus saving a LOT of time. The Agent should be able to phone a number of their contacts who would visit and make an offer within a couple of days at what will effectively be at a “wholesale” price. In fact I would hope that in my area they will phone me, but the reality is that all Agents have their own favourites.

If, however you are not rushed and you are happy to wait 12 months because you are looking for just that 1 person who would fall in love with the property that they will pay a higher price, then you could achieve £225,000. As we know, Agents are prone to overvalue so they get your instruction to market your property & the likelihood is that they will value it at this price even if you need to sell quickly. This wastes your valuable time and money.

When I have more time I will write a more detailed article about this, and include comments on selling through an auction or privately.

Ive thrown together some considerations. Its not easy.

If you want more information, an opinion or a valuation on your property without any obligation or incurring any fees, please email or phone me. I could save you a lot of time, effort, or even help you get a better price for your property.

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