Repairs to house before probate - Final update

CruisingSaver

Hi

Unfortunately my Mum passed away just over a week ago. She did have a will which names both me and my husband as executors and I’m the sole beneficiary of the will. Her total estate is well under the limit for IHT and consists of a property and cash in the main.

The property is currently in need of some work before it can be sold but I’m unsure whether the estate can pay for that work in order to sell the property? The intention is for the estate to sell the house rather than transferring title to me. Once sold the proceeds and the rest of the estate would be given to me.

Is this something that we are able to do as executors? Thanks in advance.

elsien

Is the work going to be worth doing? You may find that the cost (and the difficulty in getting tradespeople at the moment) isn’t worth the extra stress and doesn’t necessarily recoup what you’ve spent. 

You might be better off selling it as a doer upper as it is. 

CruisingSaver

elsien said:

Is the work going to be worth doing? You may find that the cost (and the difficulty in getting tradespeople at the moment) isn’t worth the extra stress and doesn’t necessarily recoup what you’ve spent. 

You might be better off selling it as a doer upper as it is. 

I did consider that but I don’t think it would be mortgageable in its current state. We’ve just completed a full house renovation on our own home so I’ve got some reliable trades I can call on.

The property is my Mum’s home and was before that her parent’s home so I’m not looking to make additional profit on the sale given the family ties just recoup what is spent. Might sound silly but I feel obligated to do the best I can for the house to honour the memory of my parents and grandparents.

thegreenone

@CruisingSaver I am sorry for your loss.  I was in a similar position 18 months ago.  

Have you had an EA in to value the property?  What exactly is wrong with it that you think makes it unmortgageable?  If you choose a reputable agency (yes, there are some) they will advise on renovate or leave as is.

My EA said "don't touch a thing".  It needed complete renovation but sold for full asking price with a queue of viewers.

Keep_pedalling

As you are the sole beneficiary there is nothing stopping you doing this, but I would do some pretty careful costing before embarking on such a project. Don’t forget to cost in CGT for any uplift in the sale price as you can’t subtract all the renovation costs from your gain.

CruisingSaver

thegreenone said:

@CruisingSaver I am sorry for your loss.  I was in a similar position 18 months ago.  

Have you had an EA in to value the property?  What exactly is wrong with it that you think makes it unmortgageable?  If you choose a reputable agency (yes, there are some) they will advise on renovate or leave as is.

My EA said "don't touch a thing".  It needed complete renovation but sold for full asking price with a queue of viewers.

Thank you. Not had an EA in as to be honest I’d be too embarrassed to let anyone in. The roof needs repairing as part of the ceiling in one of the bedrooms has collapsed and it looks very mouldy. The whole house is in quite a poor state of repair which really shocked me when I saw it as my Mum was generally really house proud but she had clearly been struggling for some time.

For clarity we hadn’t been allowed inside the house since the start of the pandemic as she was terrified of catching COVID so we had no idea what was happening.

CruisingSaver

@Keep_pedalling probably a stupid question but does CGT still apply if the estate sells the house?

shiraz99

CruisingSaver said:

@Keep_pedalling probably a stupid question but does CGT still apply if the estate sells the house?

Yes, very much so.

CruisingSaver

shiraz99 said:

CruisingSaver said:

@Keep_pedalling probably a stupid question but does CGT still apply if the estate sells the house?

Yes, very much so.

Thank you. It’s a bit of a minefield isn’t it.

shiraz99

CruisingSaver said:

thegreenone said:

@CruisingSaver I am sorry for your loss.  I was in a similar position 18 months ago.  

Have you had an EA in to value the property?  What exactly is wrong with it that you think makes it unmortgageable?  If you choose a reputable agency (yes, there are some) they will advise on renovate or leave as is.

My EA said "don't touch a thing".  It needed complete renovation but sold for full asking price with a queue of viewers.

Thank you. Not had an EA in as to be honest I’d be too embarrassed to let anyone in. The roof needs repairing as part of the ceiling in one of the bedrooms has collapsed and it looks very mouldy. The whole house is in quite a poor state of repair which really shocked me when I saw it as my Mum was generally really house proud but she had clearly been struggling for some time.

For clarity we hadn’t been allowed inside the house since the start of the pandemic as she was terrified of catching COVID so we had no idea what was happening.

Don't be embarrassed, estate agents know what they're doing and are in this position all in the time. Get them in and take their lead, there's very little point doing up an inherited property that you want to dispose off, unless, as you say it's in such a state it isn't mortgageable, but the EA would be the best to advise on this.

Keep_pedalling

CruisingSaver said:

@Keep_pedalling probably a stupid question but does CGT still apply if the estate sells the house?

If the sale price is lower than the sales price then yes it does. You might have some deductions. Adding central heating where none exists is deductible for instance but replacing an existing boiler with a new one is not.