When you inherit a property, it is tempting to immediately start cleaning, repairing or preparing it for sale. Before doing that, make sure the right person has authority to act and take time to understand the property and your options.
I Inherited a House in San Diego County. What Should I Do First?
When someone calls me after inheriting a home, one of the first questions is usually:
“Where do I even start?”
My answer is usually:
Don’t start with the house. Start by understanding the situation.
Families sometimes feel pressure to immediately clean everything out, hire contractors or put the property on the market.
Those things may eventually make sense.
But they aren’t necessarily the first decisions.
An inherited property may be owned by a trust, handled through probate or transferred another way. California Courts explains that the process for transferring property after someone dies depends on the property and circumstances, and not every estate follows the same procedure.
So before making major real estate decisions, I recommend getting clarity on a few fundamentals.
First, determine who actually has authority to make decisions
This is important.
Being a family member or beneficiary does not automatically mean someone has authority to sign a listing agreement or sell the property.
If the home is held in a trust, the trustee may have authority under the trust documents.
If the property is going through probate, a court-appointed personal representative may be responsible for managing estate property. California Courts describes the personal representative as the person appointed to represent the estate, collect and manage its property, pay obligations and ultimately distribute remaining property.
Probate sales can also involve different procedures depending on the authority granted to the personal representative. Some real-property sales may require additional notices or court involvement.
This is an area where I strongly encourage clients to work with an experienced estate or probate attorney.
I’m there to handle the real estate side.
I don’t provide legal advice.
Protect the property before worrying about presentation
Before we start talking about paint colors and staging, make sure the property itself is secure.
Is the home vacant?
Are the doors and windows secure?
Is insurance appropriate for the current situation?
Are utilities functioning where necessary?
Is landscaping being maintained?
Is there a pool?
Are there water leaks or other conditions that could become more expensive if ignored?
A vacant house can deteriorate surprisingly quickly if nobody is paying attention.
The goal at this stage isn’t making the house beautiful.
It’s protecting the asset.
Don’t automatically throw everything away
This is another area where I encourage families not to move too quickly.
Inherited homes often contain decades of personal belongings.
Sometimes the family knows exactly what should happen with everything.
Sometimes five beneficiaries have five different opinions.
And sometimes an item that looks insignificant to one person is meaningful to someone else.
Before ordering a dumpster or estate clean-out, establish who has authority and how decisions about personal property will be handled.
That can prevent unnecessary family conflict later.
Understand how title is held
The way the property is titled can affect what happens next.
The San Diego County Assessor/Recorder/County Clerk provides specific information for families dealing with the death of a real-property owner, including documents that may be needed and circumstances in which an Affidavit of Death or change-of-ownership filing may apply. The County also specifically recommends seeking legal advice when appropriate because its office cannot provide that advice.
I don’t try to replace the attorney, title company or County Recorder.
What I do want is for the real estate process to coordinate with them rather than work independently.
Then understand what you actually own
Once the legal authority and basic property issues are understood, I like to evaluate the home before recommending what to do with it.
That means looking at:
Condition.
Deferred maintenance.
Major systems.
Roof.
Plumbing.
Electrical.
HVAC.
Kitchen and baths.
Flooring.
Paint.
Landscaping.
Personal property.
Marketability.
Location.
Likely buyer.
Then we can begin discussing strategy.
Don’t remodel because someone tells you “updated homes sell for more”
Of course updated homes often sell for more.
That doesn’t mean remodeling is always the right financial decision.
I’ve bought, renovated and sold more than 50 homes, founded a construction company and previously held a California contractor’s license.
That experience has made me fairly skeptical of remodeling simply for the sake of remodeling.
Before spending estate or trust money, I want to answer:
What will this cost?
How much additional value might it create?
How long will it take?
What can go wrong?
Who will manage the work?
How much inconvenience does it create for the family?
Will buyers actually pay enough more to justify it?
Sometimes the best strategy is a thoughtful renovation.
Sometimes it is paint, landscaping, cleaning and a few repairs.
And sometimes the right answer is:
Don’t touch it. Sell it as-is.
The answer depends on the property.
Get more than one value
When evaluating an inherited property, I find it helpful to think about value in scenarios.
For example:
What is the likely value today, as-is?
Then:
What might the property sell for after limited preparation?
And possibly:
What might it sell for after a larger renovation?
Then we compare those potential outcomes against cost, time and risk.
That creates a much better decision than simply asking, “What do you think the house is worth?”
Multiple beneficiaries change the conversation
A decision that makes perfect sense for one owner can become more complicated with multiple beneficiaries.
One person may want maximum price regardless of how long it takes.
Another may want the property sold immediately.
Someone may live locally.
Others may live in different states.
One beneficiary may understand real estate.
Another may be overwhelmed by the entire situation.
That’s why communication matters.
My role is often to provide everyone with the same information and explain the real estate options clearly enough that the decision-makers can evaluate the tradeoffs.
I don’t decide for the family.
I help them make an informed decision.
Build the right team
Probate and trust real estate often works best when the professionals communicate.
Depending on the situation, that might include the trustee or personal representative, estate attorney, CPA, fiduciary, title or escrow professional, real estate broker and appropriate contractors or service providers.
Each person should stay in their lane.
My lane is the property and the real estate transaction.
That includes helping evaluate condition, preparing a sale strategy, understanding the market, coordinating property-related resources and ultimately marketing and negotiating the sale when the decision is made to sell.
You don’t have to solve everything the first week
This may be the most useful advice I can give families.
There are often a lot of decisions.
They don’t all have to be made simultaneously.
Start by determining:
Who has authority?
What needs to happen legally?
Is the property protected?
What condition is it in?
What are the realistic real estate options?
Once those questions are answered, the next steps become much clearer.
If you’re responsible for an inherited, trust or probate property anywhere in San Diego County and aren’t sure where to begin, I’m happy to help you evaluate the real estate side of the situation.
Let’s talk about your situation.
Alan Kinzel provides real estate guidance and does not provide legal, tax, accounting or fiduciary advice. Probate and trust circumstances vary, so appropriate legal and tax professionals should be consulted.
Suggested FAQs
Do all inherited homes in California have to go through probate? No. California Courts explains that the process depends on the type and ownership of the property and the circumstances of the estate. An attorney can help determine which process applies.
Should I clean out an inherited home before calling a Realtor? Usually, I would evaluate the property first. The contents, condition and potential preparation strategy may affect what should be removed, repaired or left alone.
Should we renovate an inherited home before selling it? Sometimes, but not automatically. The decision should consider expected sale-price improvement, project cost, time, risk and who will manage the work.
Can Alan help with an inherited property outside Coronado? Yes. Alan’s probate and trust real estate practice serves clients throughout San Diego County.
About Alan Kinzel
Alan Kinzel is a Broker Associate with Compass based in Coronado, California. He specializes in Coronado luxury real estate and probate and trust real estate throughout San Diego County. His background in finance, mortgage lending, real estate investing, construction and brokerage helps clients evaluate real estate decisions from multiple perspectives.
CA DRE #01925565