The emotional journey we set out on when a loved one passes away – whether expectantly or unexpectantly – can be tumultuous. One of the hardest processes we need to grapple with as the bereaved is the distribution of their assets, property transfer and/or the sale of their home (if your loved one still owned it, or lived in it, at the time of their passing).
While there’s no one-size-fits-all approach to selling the home of a deceased loved one – and there are often a myriad of elements at play that can impact the trajectory of this process – we’ve put some simple steps together to help you get things underway.
It’s important to note that the Will administration and estate distribution process can cause conflict within families. As a result, some families choose to hold on to the home of their deceased loved one for a while (and until the conflict dies down) before selling it.
What is a ‘deceased estate’?
An estate consists of a person’s assets. That’s any land, house, furniture, bank accounts, superannuation, assets such as cars and/or investment properties, business or companies, or any other valuable assets they may have owned. Now that they’ve passed away, the estate is referred to as a ‘deceased estate’. Pretty sensical, right?
When a person dies, the Executor (who is listed within their legal Will) is responsible for administering the deceased’s estate, ensuring all beneficiaries receive what they’re entitled to.
Let’s chat, “Selling your deceased loved one’s house”
There are many elements of a deceased estate, but for this guide, we’re going to solely focus on selling your deceased loved one’s house. This process can feel muddy and anxiety-inducing, so hopefully we can put your mind at ease with some of these easy-to-digest steps.
When can I sell a deceased’s house?
While you might want to sell the house immediately after your loved one dies (maybe you just want the job over and done with, or maybe you need some cash on-hand for other things), unfortunately you can’t head straight to auction. Generally, the Will will have to go through the probate process before any assets can be distributed and the family home can be sold. This process determines who is legally entitled to the property, and whether the executor is actually able to sell the property.
Who can sell a deceased’s home?
During probate, only the executor or administrator can sell the house. The proceeds made from the sale then become part of the estate, and once all debts are paid (lucky duck if there aren’t too many of these!), the leftover cash is then distributed according to the deceased’s Will.
The beneficiaries who inherit the house are able to sell the house after probate. They can then choose to:
- Split the proceeds between all of them, or;
- One (or more) beneficiaries can choose to buy the others out
Something worth noting, though, is that if the house is jointly owned (in a ‘joint tenancy with a right of survivorship’ agreement, common between partners or spouses), the surviving partner can legally sell the house without going through the whole probate process. So it might be worth checking your own Will and home ownership status if you’ve purchased your home with a partner – just a small thing worth considering.
How do I prepare the house for sale?
Your loved one’s home might need some extra TLC before you announce its impending sale. You’ll generally need to:
Sort out what you’d like to keep, what you’d like to donate, and what you’d like to sell.
Rectify or maintain the physical state of the home
You might need to freshen the place up with a new coat of paint, fix broken curtains/blinds, replace mouldy window frames, or deep-clean the carpets (amongst other things).
Select your real estate agent
it’s important to do heaps of research before you choose your agent! Sometimes it’s also worth asking the agent if they have experience in after-death sales, too.
Stage the home for sale
If your loved one’s furniture was a little outdated, it might be worth considering investing in staging for their place before putting it up for sale. This can generally be organised via your chosen real estate agent and ensures the place appears modern and fresh when interested buyers come to inspect the property.
This preparation process can be emotionally draining. It’s often best to sort through your loved one’s belongings and prepare the house for sale alongside your family members or friends. It can also be a lovely way to reminisce over your favourite memories, while avoiding the need to reflect on past times alone.
It might also be worth asking your chosen real estate agent if they have someone you can speak to who is experienced in after-death sales. They’ll often have tips and advice that’ll help make the process a little easier.
Costs associated with putting the house on the market
Yep, you’ll have to pay for expenses such as taxes, maintenance and ongoing repairs before the house is sold. And, if your deceased loved one was previously paying off their mortgage, you’ll have to foot that bill, too. The money for the mortgage will need to come either from your own personal bank account, from the finances left to you by the deceased in their Will, or from the proceeds of the sale of the property. If you don’t pay off the mortgage, you might risk losing the property all together as the lender can seize the property.
Any required repairs or maintenance will also need to be paid for prior to the house being sold (or put on the market). Just something to be wary of.
What happens once the house is sold?
Well, firstly, it’s time to celebrate! There’s nothing more exciting than successfully selling a property – although, we recognise this can also be an extremely emotional time for families who have shared plenty of special memories in that home. It might be nice to set some time aside to reflect, reminisce, and share memories together before saying goodbye to the home forever.
In terms of money? The executor will distribute the proceeds from the house sale in accordance with the deceased’s Will. Of course, before this occurs, all debts and taxes will need to be paid. The remaining funds will be given to the beneficiaries (so no, you won’t necessarily receive the amount you think you’ll receive once the house is sold).
Selling the house of a loved one can be emotionally challenging, especially if you’ve shared beautiful memories there with family and friends. Remember to always take time out for yourself during this process – it’s okay to take things slowly, and it’s okay to reach out to friends and family for support if you need it.
Want to make sure your house is sold according to your wishes when you pass? Include everything you want your loved ones to know in your Will, with Willed. Get started in as little as 15 minutes. Need help? Our legal experts are available by phone, email and live chat to assist with all things Wills. Book a call with our friendly (and clever) team today.