Property valuation type required for probate

Savvy_Sue

Sarahspangles said:

The RICS estimate is definitely the correct one if you think you’re close to IHT thresholds. If you aren’t, you still need a realistic valuation from estate agents because if it’s undervalued you would pay CGT on the gain during the period before sale.

I agree, RICS is good if you might have to rely on the valuation in an argument with HMRC, but one advantage of actually asking for EA valuations (rather than looking at prices around you) at this stage is that you should get a feel for who you'd be happy to work with. 

Of course the disadvantage is that you are then 'known' to three estate agents, keen to get your business ... 

BTW, I was able to get a free RICS valuation from someone who also represented an estate agency. He said he didn't like to profit from such situations, and of course he hoped we might use his agency when we came to sell. That worked! 

Savvy_Sue

RnK136 said:

Flugelhorn said:

I just estimated from  a couple of recent sales on the same road - I seem to remember that if you are well adrift of any IHT thresholds then you don't need anything more formal. I put £230K for the property and got £226K when I sold it 

That might be the issue I have. Next door was up for sale last year at £500k, but my Dad's house is in terrible condition in comparison to theirs and that would definitely be factored into what we sell it for.

And you need to make it clear to the agents that you want to price for a quick sale, taking condition into account, and that you're not proposing to do anything yourselves, and that you don't want prospective buyers arguing you down because of the amount of work required. Assuming that's the situation, of course, but generally it's not worth doing much before sale, because if the kitchen needs ripping out there's no guarantee the one you put in will appeal to the buyers and they will still be mentally costing that among the work which needs doing. 

RnK136

Savvy_Sue said:

RnK136 said:

Flugelhorn said:

I just estimated from  a couple of recent sales on the same road - I seem to remember that if you are well adrift of any IHT thresholds then you don't need anything more formal. I put £230K for the property and got £226K when I sold it 

That might be the issue I have. Next door was up for sale last year at £500k, but my Dad's house is in terrible condition in comparison to theirs and that would definitely be factored into what we sell it for.

And you need to make it clear to the agents that you want to price for a quick sale, taking condition into account, and that you're not proposing to do anything yourselves, and that you don't want prospective buyers arguing you down because of the amount of work required. Assuming that's the situation, of course, but generally it's not worth doing much before sale, because if the kitchen needs ripping out there's no guarantee the one you put in will appeal to the buyers and they will still be mentally costing that among the work which needs doing. 

Excellent advice - thank you!
We don't intend to do any work, no. Cut our losses and sell as a project, so indeed: priced to sell as is.

Keep_pedalling

Savvy_Sue said:

RnK136 said:

Flugelhorn said:

I just estimated from  a couple of recent sales on the same road - I seem to remember that if you are well adrift of any IHT thresholds then you don't need anything more formal. I put £230K for the property and got £226K when I sold it 

That might be the issue I have. Next door was up for sale last year at £500k, but my Dad's house is in terrible condition in comparison to theirs and that would definitely be factored into what we sell it for.

And you need to make it clear to the agents that you want to price for a quick sale, taking condition into account, and that you're not proposing to do anything yourselves, and that you don't want prospective buyers arguing you down because of the amount of work required. Assuming that's the situation, of course, but generally it's not worth doing much before sale, because if the kitchen needs ripping out there's no guarantee the one you put in will appeal to the buyers and they will still be mentally costing that among the work which needs doing. 

That risks a low valuation that could lumber you with a CGT liability, which is what we have suggested the OP avoids. 

Sarahspangles

Keep_pedalling said:

Savvy_Sue said:

And you need to make it clear to the agents that you want to price for a quick sale, taking condition into account, and that you're not proposing to do anything yourselves, and that you don't want prospective buyers arguing you down because of the amount of work required. Assuming that's the situation, of course, but generally it's not worth doing much before sale, because if the kitchen needs ripping out there's no guarantee the one you put in will appeal to the buyers and they will still be mentally costing that among the work which needs doing. 

That risks a low valuation that could lumber you with a CGT liability, which is what we have suggested the OP avoids. 

From experience you’re both right - we’ve now sold two properties after losing both sets of parents. In each case we believed we had “priced to sell” in the interests of settling the estate and not having the ongoing responsibility. We quickly got offers at the value we’d given for probate, despite believing we’d left some headroom.

I think in each case the property was a bit more saleable once we’d decluttered, not that either was particularly bad. We didn’t spend more than a couple of hundred each time fixing things. It was removing things, mostly for family members, that made the difference.

Savvy_Sue

Sarahspangles said:

Keep_pedalling said:

Savvy_Sue said:

And you need to make it clear to the agents that you want to price for a quick sale, taking condition into account, and that you're not proposing to do anything yourselves, and that you don't want prospective buyers arguing you down because of the amount of work required. Assuming that's the situation, of course, but generally it's not worth doing much before sale, because if the kitchen needs ripping out there's no guarantee the one you put in will appeal to the buyers and they will still be mentally costing that among the work which needs doing. 

That risks a low valuation that could lumber you with a CGT liability, which is what we have suggested the OP avoids. 

From experience you’re both right - we’ve now sold two properties after losing both sets of parents. In each case we believed we had “priced to sell” in the interests of settling the estate and not having the ongoing responsibility. We quickly got offers at the value we’d given for probate, despite believing we’d left some headroom.

I think in each case the property was a bit more saleable once we’d decluttered, not that either was particularly bad. We didn’t spend more than a couple of hundred each time fixing things. It was removing things, mostly for family members, that made the difference.

Indeed, my apologies on the CGT front. So a good conversation with estate agents, stressing you're not doing any work, and not wanting people to under offer because of the amount of work required, but leaving some headroom for doing better than expected. I don't think your estimated value of the house gets checked in any way, so as long as you've got an email quote stashed away somewhere in case there's an argument, which there won't be because you're being realistic. 

It is indeed amazing what clearing a house can do, likewise estate agents' photos. I would not have recognised my late mother's house from their handiwork!