If you’re the executor of a will, you’ve likely already discovered that your role is part administrator, part problem-solver, and part decision-maker. One of the bigger tasks you may face is selling a property from the deceased estate. It’s not as simple as listing the house and signing a contract; there are legal steps you need to take before you can sell.
Here’s what you need to know about how property is sold from a deceased estate, and how to avoid common issues that can delay settlement or put the sale at risk.
Start with authority: Do you have the legal right to sell the property?
Before you can sell any asset from the estate, including real property, you need legal authority to deal with it. That comes through a grant of probate (if there’s a will) or letters of administration (if there isn’t). Until this is granted, the executor or administrator doesn’t have legal title to sell.
In most cases, the property can’t be transferred or sold until probate or letters of administration are granted. This process typically takes several weeks or longer, depending on the complexity of the estate and how promptly everything is lodged. It’s common to prepare the contract of sale in the meantime, but it should include a special condition making the sale conditional on the grant being obtained.
If there are multiple executors or administrators, they all need to agree to the sale. Ideally, they all sign the sale documents. If one can’t or won’t, legal advice may be needed to avoid disputes or delays.
Preparing for sale: Disclosure, condition, and paperwork
Once probate is underway or granted, you’ll still need to approach the sale like any other conveyancing matter, but with a few extra checks.
- Disclosure obligations: You’ll need to disclose any known issues with the property in the contract. While you might not have lived there, you should take reasonable steps to understand its condition. A building inspection or pest report can be helpful, especially if the home has been vacant for some time.
- Authority of the seller: The certificate of title will still be in the deceased’s name. The sale contract should reflect that the property is being sold by you as executor of the estate. Your conveyancer or lawyer will prepare the documents accordingly, and the property can be transferred once probate is granted.
- Capital gains and tax implications: While you may not be taxed on the sale itself, the estate could be liable for capital gains tax depending on how long the property has been held, whether it was the deceased’s main residence, and how long it’s been since they passed away. This is an area where it’s smart to involve an accountant.
Avoiding pitfalls: Timing, terms, and team support
Timing is often the biggest issue when selling estate property. Many executors feel pressure to sell quickly, especially if beneficiaries are waiting on their share. But jumping ahead without the right authority can cause significant legal and financial risk. If the sale is challenged or probate is delayed, the buyer could walk away or worse, sue for breach of contract.
To keep the process smooth:
- Wait until probate is well underway before signing anything.
- Use special conditions to protect the estate in case of delays.
- Engage a lawyer or conveyancer early, ideally one experienced in estate matters.
- Work with an accountant who understands the tax implications of estate sales.
You’re not expected to be an expert in all this. As executor, your role is to act in the best interests of the estate and its beneficiaries. That includes knowing when to bring in professional help to avoid costly mistakes.
Selling a property from a deceased estate is manageable, but it’s not something you want to DIY. With the right guidance and good planning, you can get it done efficiently and respectfully, while protecting yourself and the estate along the way.
Disclaimer
The information on our website is general and is not legal advice. We put lots of work into making our content insightful, but it may not apply to your personal circumstances. We’re more than happy to help with your individual issues – just reach out.