Although the nation’s homesellers have enjoyed a pandemic price boom spurred by pent up demand and the removal of stamp duty on purchases, there is, of course, those who will have been forced into the market having been named an executor on the last will and testament of a loved one.
However, before they can bring the property of the deceased to market, they have to complete the probate process and property purchasing specialist, HBB Solutions, has highlighted the steps that must be taken in order to do so.
What is probate?
Probate is the judicial process used to prove, in a court of law, that a person’s last will and testament is in fact true and legal before being settled in accordance with the wishes of the deceased. So, if a person is left an asset, such as a property, probate must be completed before they can formally claim their inheritance.
When a person passes away, an executor named in the will is responsible for ensuring the affairs of the deceased are handled in the way they hoped. The executor is usually a family member or friend – but a professional executor can also be appointed. This person then needs to obtain a Grant of Probate in order to start dealing with the will and assign inherited assets. This can be a lengthy process that includes registering the death, valuing the estate, and paying any inheritance tax that is due.
Selling a house in probate
The main thing to be aware of is how long it takes to sell a house in probate. While the timeline for selling a standard home is around 6 months, it typically takes an average of 10.5 months to sell a home in probate. A big reason for this extended selling time is how long it takes to get a Grant of Probate, thus meaning it can be several months before being able to formally take ownership of any inherited assets.
However, while a home cannot actually be sold while in probate, it is possible for a property to be valued and put on the market before probate has been granted. If someone places an offer on a home that is in probate, it can be accepted but contracts cannot be exchanged until probate has been completed.
The five main steps towards selling a home in probate are:
- Register the death.
- Valuation – this must be done in order to apply for Grant of Probate.
- Check title deeds – vital for awareness of any restrictions that apply to the property or its land.
- Pay inheritance tax – this must be paid before probate can be granted. This means funds from inherited assets cannot be used to pay the tax.
- Apply for a Grant of Probate
How much is a probate property worth?
Essentially, there’s no reason a probate property shouldn’t command the same market value as any other property.
However, the research by HBB Solutions shows that the average asking price for a probate property in the current market is £277,597 – -18.6% less than the average UK asking price.
This may be down to a range of factors. For some, selling the home of a lost loved one is painful and so they may lower the asking price to achieve a quicker sale in order to gain closure.
Alternatively, many will opt for a professional purchasing platform such as HBB Solutions as it allows them a quick and certain sale, securing the price agreed without the need to oversee a transaction that can drag on for almost a year in many cases.
You may often find that homes belonging to those in their later years may also need renovation or modernisation in order to appeal to the modern-day homebuyer and so this is also factored in when pricing for the market.
Of course, then there is the issue of the probate itself and while some homebuyers may be more than happy to wait, this longer transaction timeline will often be reflected within the asking price.
Managing Director of HBB Solutions, Chris Hodgkinson, commented:
“Selling a home in probate can be a more complicated process as there are a number of additional steps that need to be taken such as checking title deeds, paying inheritance tax and applying for the Grant of Probate.
As a result, the time it takes to sell a property in probate will generally drag on for far longer than the average transaction, but you can get the wheels in motion by marketing the property before the Grant of Probate has been awarded.
Of course, it can be quite a painful process for those to have lost a loved one and so it’s not unusual for them to opt for a professional executor, or even to use a professional property purchasing platform to ensure a quicker sale.
On average, it takes HBB Solutions just 50 days to complete on a purchase once our offer is accepted, although we have seen transactions complete in as little as four days. That said, it’s not all about speed, particularly for those dealing with bereavement.
Our ability to tailor the completion date to the individual needs of the seller is something that also appeals to many, as we can provide certainty, speed and flexibility at a time when it’s arguably needed most.