Selling Inherited Property In California The “How-To” Guide
Selling inherited property in California may not be easy. Firstly, there’s an emotional aspect of selling an inherited property. Then, there’s the cost and time of making the property ready for potential buyers. On top of all of this, there could be liens, other hidden problems, and disagreements between family members.
If you have a plan, it makes the process of selling an inherited property in California faster and less stressful.
Here’s a quick overview of what you’ll need to do.
Selling Inherited Property In California:
- Assess the market to see if it’s a good time to sell.
- Determine value.
- Contact professionals, if needed
- Decide if you would like an “As-Is” all cash transaction.
Firstly, it would be prudent to assess the market to make a decision to sell or hold onto the property. Although renting has it’s own headaches! How much does it rent for? Is there a mortgage? Will the rent cover the mortgage? What about the taxes, insurance, maintenance and utilities? Will there be any profit left over? What kind of neighborhood is it in? Can you manage a rental property?
Determining value is another important aspect of selling inherited property. It’s a very simple process and only takes about fifteen minuets or so. To get a better idea of the value, it may be helpful to drive by the comparable sold properties. Remember, only use sold comparable properties, NOT properties currently for sale!
If your property is in poor shape it’s sometimes best to sell to an investor. If the property will not qualify for conventional financing, it will have to be purchased all cash. Many people still list the property with an agent asking for all cash offers, and the offers usually end up being the same as if they were to contact the investor themselves. The heirs have to pay the agent and end up coming out with less.
Connect attorney if needed, as sometimes inheritances are not always a simple process. You may need to go through Probate Court, and there will likely be a period for ‘creditor claims’, which the real estate will likely have to go through.
Tax professionals can also be of great help to determine what you may owe if you decide on selling inherited property in California. Some people wonder if they need to pay capital gains tax on an inherited property. Usually, when you inherit property, the basis is based on when you inherit it, or the current value of the property.
For example, suppose you inherit a house that was purchased years ago for $150,000 and it is now worth $350,000. You will receive a step up from the original cost basis from $150,000 to $350,000. If you sell the property right away, you will not owe any capital gains taxes. If you hold on to the property and sell it for $400,000 in a few years, you will owe capital gains on $50,000 (the difference between the sale value and the stepped-up basis).
If you received the property as a gift before that person passed, then the basis would be $150,000. This means you would pay taxes on the difference between the $150,000 and the sales price. (Unless you live in the house for two years or so) This is not tax advice, but will give you an idea of what to expect when calling a tax professional.
Recap:
- Assess the market to see if it’s a good time to sell.
- Determine value.
- Contact professionals, if needed
- Decide if you would like an “As-Is” all cash transaction.
Selling inherited property in California doesn’t sound so complicated after all!
If you’re looking to sell an inherited house in California, whether it’s in Los Angeles County, Ventura County, Riverside San Bernardino, Fresno, Bakersfield or Kern County we’re here to help!
Quick Home Offers can provide you with an “As-Is” fair all cash offer. If you’re thinking of selling inherited property in California, and would like a no-obligation free offer, contact us below.
(805) 870 5749
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