If you’ve ever sold your own house, you know how stressful it can be — making all the repairs, deep cleaning, corralling kids and pets, staging, and photos… and then the endless, endless showings interspersed with endless, endless cleaning. Yes, selling a house is an enormous endeavor — and if it’s not your house but your parents’ house, then you probably have a slew of other issues to handle on top of the home sale.
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We talked to Rita Shaw from the Rita Shaw Broker & Associates, Inc, a brokerage serving the Redlands, California, area and currently managed by Joseph Shaw. She walked us through the process of adult children looking to sell their parents’ home.
Dealing with grieving family
There are a lot of feelings involved in a transaction like this. Regardless of the circumstances, Shaw says, “When someone passes away, either everyone is on the same page and getting along and loving and a pleasure — or you have the total opposite.”
“As the probate real estate agent, I deal directly with the person in charge,” she adds. “And if they can’t agree… I try to deal with their representatives.”
As part of their services, a probate real estate agent works with attorneys for all involved family members to sell property and assets in estates where the family relationships are distressed or broken. For example, two brothers living on opposite sides of the country trying to deal with a multimillion-dollar estate without talking or interacting with one another could get the house sold through a probate real estate agent.
Preparing for listing your loved one’s home
Your agent will help you with the research to determine the condition of the estate and decide on a fair price for the house. One of the first things that an agent should do in this situation is help you order a title report so that you can assess whether the mortgage has been paid in full, whether there’s a second mortgage on the house — or tax or other liens that simply aren’t on your radar.
“We want to be ready to close when we go under contract, so we get this part done as soon as possible,” Shaw notes.
In a typical transaction where the title status is not in question, the title search takes place when the property is under contract; however, in a transaction subsequent to a death, agents often prefer to make sure all the paperwork is in order before listing the house on the market to avoid potential delays at closing.
Keep, donate, toss
Adult children also have to deal with what Shaw calls “the stuff.” After living in a house for possibly decades, your parents have likely accumulated furniture, clothing, and possessions — things that you’ll have to sort through and clear out before you can sell your parents’ house.
Even if your parents aren’t deceased and living in a nursing home, “chances are they only took a box of personal items with them and everything else stayed in the house,” explains Shaw. She suggests that families host an all-hands meeting, so to speak, with everyone present at the house, and then decide together who’s going to take what.
“I’ve been in a situation where the heirs have all picked their piles and there’s a pile in the middle of the room they’re fighting about — and we just flip a coin,” she remembers. “That was a very contentious estate.”
Another suggestion: Every family member should bring a box and fill it with things that are meaningful or personally important to them — family pictures, a book, a vase.
In general, Shaw says, relatives have little use for larger pieces of furniture. Anything that doesn’t get selected by family members should be offered for charities or to a junk hauler.
It helps to get prepared for purging as much “stuff” as you can ahead of time, whenever possible. A good real estate agent can work with you, explaining to aging parents that children are not likely to want furniture and offering options for downsizing.
Pricing to sell
If your scenario is a guardianship and your parents are infirm but living, the usual pricing process takes place: the real estate agent will identify fair-market value based on comparable properties and look at overall market conditions.
If your parents are deceased and did not leave their property in a living trust — and the house is thereby subject to the probate process — a probate referee will have the property appraised, and the final sale price needs to be within 10% of that price. “A probate real estate agent can work with you to prepare a market analysis and suggest a pricing strategy for the property,” Shaw says.
If the market analysis recommendation is lower than the probate referee’s assessment, you will have to list it at the recommended probate price; if the home doesn’t sell, the agent has to go back and request a new appraisal before cutting the price.
Repairs and staging
When it comes to deciding which repairs to make, or whether the property should be listed as-is, ask your real estate agent for a market analysis that considers each scenario individually, and then use the information presented to decide whether to invest in making improvements or not.
This is a personal decision; some sellers don’t want to take the time or expense to make any improvements and would prefer to list at a lower price. Shaw says that sometimes, she will organize any updates as the agent, and then the seller will reimburse her for the expenses at closing.
The most common repairs? Paint, stripping wallpaper, and pulling up carpet to show hardwood floors, says Shaw. “But these are recommendations we give any seller, regardless of whether it’s an estate or someone selling their own home.”
When it comes to actually performing the repairs, sometimes sellers opt to make those changes themselves to save money, but sometimes, it makes more sense to find a handyman or a contractor to get the job done. Your real estate agent can refer you to someone qualified.
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