Selling an inherited home

Before you think about listing, take care of the basics. These protect the home and keep the sale on track.

• Find the will or trust documents and confirm who has authority to sell
• Change the locks and secure the property
• Call the insurer to make sure the home stays covered
• Keep utilities on so the home is protected and easy to show
• Get a sense of value with a comparative market analysis

If the home passes through probate, a court usually appoints an executor or administrator who can sell it. If the home was in a trust, the trustee may be able to sell without court involvement. Rules and timelines vary by state, and a probate or estate attorney can tell you what applies.

Inherited property often gets a basis equal to its fair market value on the date of the owner's death, rather than what the owner originally paid. That can greatly reduce the taxable gain when you sell. State rules and your situation matter, so talk with a tax professional before you sell.

Hypothetical example. A parent bought a home for $150,000. It was worth $400,000 when they passed away, so the heir's basis may be $400,000. If the heir sells for $410,000, the gain may be about $10,000 before selling costs, not $260,000. A tax professional can confirm your numbers.

Co-heirs need to agree on whether to sell, keep or buy each other out, and at what price. Clear, early communication helps. If heirs disagree, an estate attorney or mediator can help find a path.

Many inherited homes need a clean-out first. After that, decide how much to fix. Basic repairs, a deep clean and fresh paint often help a home show better. If big repairs are needed, selling as-is may make more sense, priced to reflect the work a buyer will take on.

Price from recent comparable sales. An agent's comparative market analysis can help co-heirs agree on a realistic number. Your agent can also help with disclosures, which may differ for estate sales depending on your state.