Inheriting a home may be a blessing or a burden, depending on your current financial and living situation. For example, what do you do if dear old Aunt Edna has bequeathed her beloved home to you and you don’t want or need it?
It’s not an uncommon scenario. That’s why estate sale companies are in business. In fact, the National Estate Sale Association estimates that the value of items – including homes and other real estate – sold at estate sales each month is $100M!
Even with the help of a professional estate sale company, dealing with the sale of a home as part of an estate can be an emotionally draining, stressful and complex process. Whether you’re an executor of the deceased’s will or a beneficiary, understanding the intricacies of selling a home as part of an estate sale can help save you from an early grave.
What is an estate sale?
Different from garage or yard sales, estate sales are used to manage and sell an estate’s assets. This can include furniture, clothing, jewelry, art, housewares, vehicles, a home and/or other real estate properties.
Most sales are held over a two or three-day period at the ‘estate,’ or home, of someone who has passed. Typically used for the disposition of a decedent’s belongings and assets, it’s not uncommon for homeowners dealing with divorce, downsizing, debt or other financial issues to have an estate sale to help relieve those burdens.
Many people choose to hire an estate sale company to assist in organizing and managing the sale. Estate sale companies charge a percentage of the sale’s gross profits as a commission, which can range from 25% to 45% or more depending on the size and complexity of the estate.1
Why sell a home as part of an estate sale?
There are several reasons why people need to sell a home as part of an estate sale. It may be necessary to liquidate assets to distribute the proceeds among beneficiaries, cover debts, or ensure an equitable division of assets. In some cases, the home may require ongoing maintenance costs or taxes that the estate cannot afford, making it more practical to sell the property.
What you need to know about selling an estate home
Selling a home as part of an estate sale requires careful planning, adherence to strict legal requirements and probate regulations, and effective communication among all parties involved. Consulting with an estate attorney is highly recommended to ensure all legalities are taken care of so you can determine the most equitable way to sell an estate home.
Determining the selling price of a home in an estate sale can be challenging. Factors such as market conditions, what shape the home is in and its location, as well as appraisals, play a significant role. Generally, estate sales may yield a lower selling price than the open market due to time constraints and the home’s condition, but you do have options to help optimize the price you may get.
- Auctions. Auctions can create a sense of urgency among potential buyers, leading to competitive bids and potentially higher sale prices. They also offer a transparent and efficient process for selling the property, especially if there’s uncertainty about its market value.
- Listing on the open market. As with any other house, you can sell an estate home by listing it on the market. Be prepared, though, that an estate home may take even longer to sell than usual. Timing-wise, you need to factor in the complexity of the estate, obtaining probate or estate administration approvals and take into consideration the condition of the property and preparing it for sale. On average, the process can take several months to a year or more.
- Sell for cash to Offerpad. We buy estate homes! As long as we’re provided with appropriate documentation showing a clean and clear title to the property, we can give the estate, individual or entity that has legal authority to sell it a free, no-obligation cash offer. You can have the cash proceeds from the sale of the home available to use as needed within weeks, not months, to quickly settle the estate. (Other restrictions may vary state to state. Speak with an Offerpad representative for more details.)
If you need to sell an estate or any other home, Offerpad’s real estate experts are here for you. We can help you buy and get a home loan, too. In fact, we can help you do literally (almost) everything to meet your real estate needs. Find out more at offerpad.com.