Inheriting a house can be stressful, especially if you’re sharing it with siblings. This is because, in order to sell the property, all shareholders must give their consent. When people are in different financial situations, have different viewpoints or maybe don’t have a strong bond with their siblings, this may create tension.
The best-case scenario would be that all siblings agree to sell the property and they then split the money equally amongst themselves. Alternatively, if the property is in a good condition and can be rented out then all siblings can split the rental income.
Regardless of whether siblings are united or against each other when it comes to their views on the property, no one person can force the sale and an agreement must be reached. It is possible for one person to sell their share of the property, either to another sibling or a third party, however, third parties are unlikely to want such a small proportion of a property, especially if it means sharing with warring family members!
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Inheriting a property (Joint tenants vs tenants in common)
What's the difference between joint tenants and tenants in common?
All siblings have equal rights to the property as a whole. If any sibling dies then their share automatically passes to the other siblings.
Tenants in Common
Each sibling owns a specific and defined proportion of the property.
As tenants in common, if all siblings agree that the house should be sold, then the income from selling the inherited property should be divided out between them according to what percentage they own.
How to sell inherited property with siblings
When you inherit a house you a few different options of what you can do, and it generally depends on whether or not the siblings as a collective can agree on what action they want to take with the inherited property. We've provided a few of the options you have available and some detail about each:
Selling the property & dividing the cash
If you agree to sell the property with your sibling(s) then that really is the ideal and easiest to sell scenario. You would sell this property much like selling your own property, you can choose between going to the open market through an estate agent, a property auction or using a sell house fast company such as ourselves.
The only sticking point that you often get around these traditional sales is that all the siblings need to agree on the sale price of the property - meaning you all need to accept the bid.
Buying other siblings out of the property
Majority of the time each sibling will be given an equal share of the estate. One sibling may wish to purchase other siblings share of the property and this is a simple way to split the inheritance.
You do this by agreeing the value of the property and paying cash for the other shares, or you can even apply for a mortgage. If you're unable to get a mortgage, you might even be able to arrange with your siblings for them to become lenders themselves, meaning you will pay a monthly fee until the share is paid off, but you should do all through legal routes to avoid any future issues.
Not all siblings sell their share
Sometimes siblings disagree, it happens, and not all the siblings might want to sell their share. If this is the case, you might have the option of selling your share to a third party but this can further complicate the situation for your siblings.
Alternative - Keep the property as a rental investment
A further option, that you may want to consider before selling the home is renting it out. If you feel you and your siblings could be co-owners then it can be an excellent source of extra income whilst still keeping the house in the family. This could provide time for one of the siblings to raise the funds to purchase the shares of the property off the other siblings.
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Can siblings force the sale of inherited property?
If you’re in favour of selling, but other siblings want to keep the property then you can apply to the court requesting an ‘Order to sell’.
To do this, you must write to each sibling that you share the property with, outlining exactly why you feel the house should be sold. Your siblings can then discuss or dispute the sale. If you were the only one wanting to sell then your argument must be compelling in order to win.
Sometimes the best way to resolve this particular situation is to hold onto the property and own it together as either joint tenants or tenants in common.
Will you have to pay any taxes on inherited properties?
If you’re selling an inherited property then you may have to pay Capital Gains Tax, inheritance tax and income tax if it's applicable. The main tax you will likely need to be concerned about is the Capital Gains Tax (CGT), and it's quite a comprehensive subject which we've covered in another post about how much Capital Gains Tax you need to pay.
How We Can Help
To take the stress out of selling an inherited house that you own with siblings, why not consider a quick cash buyer? The Property Buying Company can buy your property in a timescale to suit you for a fair cash sum and all legal fees are included. Our fantastic customer service team are experts at handling the tricky world of inheritance and probate, we can act as a go between for all siblings & hold your hand through the whole sale process.
This will take the stress out of the situation and free up some cash for you to use on another property or project.
Trying to navigate selling an inherited house, we can help!