How to Sell a House When Someone Dies
Estimated reading time 8 minutes
When a family member sadly passes away, there is a lot to take on. With emotions riding high, it can be a time fraught with confusion and uncertainty and, unfortunately, a lot of hard work.
Organising a funeral, applying for probate, selling the house and more all need to be completed. Some processes are much simpler than others and with the support of your family, you will be able to complete them quickly, allowing you time to grieve without the pressure of having a mountain of tasks hanging over your head.
In this edition of our blog, we look at the emotional process of having to sell a house when someone dies – a house that was possibly your family home before you moved on to start a family of your own.
Do you have to sell a house after someone dies?
Selling the home after someone dies can be a challenging time, especially with the sentimental value and the memories attached to it. The house, in most cases, would have been left to someone, or some people in the will of the deceased person. The inheritors of the property then have the right to live in the house, rent it out or sell it.
Depending on the value of the property and the estate of the deceased as a whole, inheritance tax may have to be paid. Current rules on inheritance tax mean that if the estate is worth more than £325,000, 40% tax is paid on anything above that value. You may also have capital gains tax on inherited property to pay too.
In many cases, people opt to sell, the financial reward of selling the house often being an objective of the deceased homeowner. To do this, though, an executor must be appointed.
Do you need an executor to sell a house after someone dies?
To sell a house when someone dies, an executor will need to be appointed. An executor is normally appointed in the will and takes on the responsibility of not only selling the house but also settling any debts and valuing the assets of the estate. This will also involve the payments on inheritance tax and distributing any cash and assets as the will dictates.
You can, of course, opt to keep the house and use it for yourself, or rent it out. However, in many cases, the property does end up being sold. This type of sale is known as a probate sale. For it to go through, you, the executor, will need to be granted probate to have the legal right to sell the home. Just be aware that it can take some time to be granted probate, so selling the house isn’t always a quick process.
How long will it take to sell a house after someone dies?
The executor of the will has what is known as the executor’s year to organise everything surrounding the estate of the deceased individual. This is a twelve-month period where everything is expected to be organised and settled. However, when it comes to organising the home sale, things can be a little different.
Inheritance tax must be paid six months after the death of the property owner, and with the granting of probate taking anything up to three months, you could find that you only have three months in which to sell the home and settle the inheritance tax bill.
This is perhaps one reason many people look to the cash house buyer market. It not only guarantees a sell house fast solution, but enables you to settle the inheritance tax bill promptly and stave off any potential penalties.
If the house has not sold after the six-month inheritance tax deadline, you can opt to pay the tax yourself from your own funds, and then have it repaid to you once the sale has been completed. If you haven’t applied for probate yet and the deadline for inheritance tax is looming, things might get slightly tricky. The deadline for inheritance is six months after death, regardless of whether a property is sold or not. Its value is calculated in advance of any sale, too, so it is wise to apply for probate quickly.
Can I sell the house without probate?
No – the sale of a house after someone dies cannot be completed without probate being granted. Whilst you can list the house for sale with an estate agent more or less right away, a sale cannot be completed until you have the probate paperwork in hand. With it taking as long as three months to be granted, you should do this sooner rather than later.
Costs of selling a house when someone dies
You should weigh up the costs that could be associated with the sale of the home. Inheritance tax, capital gains tax and insurance are the most obvious expenses to come from selling a property after someone dies, but you should also factor in the costs of bills, cleaning services and other property upkeep expenses. Bills are normally settled by the executor relatively soon after the passing, but it would be worth noting that if the home is likely to be unoccupied during winter months, you may want to still use the heating to prevent mould and damp.
Step by step selling a house after someone dies
Now you know that probate must be applied for, inheritance tax must be paid and the deadlines you need to work towards, follow our quick step guide below to have everything completed as and when it should.
Have the property valued
Get the house valued as soon as you can. You can list the property for sale before probate has been granted and have people view it right away; you just won’t be able to complete the sale until you have the probate documents. Getting valuations from a selection of estate agents is often best as you can get a feel for the local market, and see what prices you could expect.
Apply for probate
If you are named as the executor, you should apply for probate as one of your first steps. That way you can proceed with the house sale and settle the estate promptly. Plus, it helps with the inheritance tax.
It will take almost three months to be granted and can cost you up to £300.
Check the title deeds with your solicitor
You may have had the property left to you in the will, but there could be some details within the deeds that need smoothing out. Additional owners or even restrictions surrounding the property could be uncovered, both of which could delay a sale or mean further action needs to be taken.
Prepare the house for sale
From cleaning it to making it marketable, this step should be taken with care but also with a sale in mind. You may want to refurb things a little, you might want to replace things altogether, or you may feel the garden needs a fix. Whatever you decide, remember viewings will take place and those people looking to buy will want to see the home in its best vision, but also in a way that allows them to see it how they want it to be. Clear the clutter, take the memories elsewhere and make the sale.
Get the property listed
With valuations completed, deeds checked and the home in a sellable condition, you can opt to have your home listed with the estate agent of your choosing. Just remember that the market can be slow and so the sale may not happen quickly. If your inheritance tax deadline is looming and there are not enough funds in the estate to cover it without the house sale, it may be worth considering a cash house buyer. You are unlikely to receive the full value for the property, but it does make for a much quicker house sale. The current time for a property sale to be complete on the traditional market is largely variable. For example, in April, Zoopla stated that 25 weeks is the average, whilst others have said it is much closer to 12.
Factor this into your decision. A sale on the traditional market could make you more cash, but it could take considerably longer to complete.
Secure home insurance
As the executor, it is a legal obligation to hold insurance for the property. You may find that the insurance costs significantly more than the insurance on your own home. This is because insurers are well aware that an empty home potentially poses more risk to them; the likelihood of flooding, fire or theft is greatly increased when a property is vacant.
With all the above complete, you should be able to go through a relatively stress-free process of selling the house. If you are looking for a quick sale, contact Gaffsy. Our team of property experts can visit your property and give you a free cash offer, then should you agree to it, we can have the house sold and funds in your account within seven days. We even cover legal fees.