Inheriting a property can be an immense gift and boon to your future. Even if it’s not going to be a home to live in, it is nonetheless an asset that can yield a marvelous windfall. With inherited property however comes certain important responsibilities and that goes double and triple for executors or trustees.
There are all sorts of issues that accompany real property ownership; property taxes, insurances and vacancy liabilities just to name a few. Foremost in the minds of heirs however, is a desire to sell it for the best profit possible. So when a case of the failure of an estate to get fair market value in a sale came to light, I felt it was important to pass it along to my readers. In a recent MarketWatch article titled “This NYC home’s price rose 54% in a week,” the New York City home in question was inherited and then privately sold. As the real estate market heated up the buyers quickly flipped it for a whopping 154% of the sale price given to the heirs.
While it is possible that the heirs knew what was going on and chose to sell it anyway, it is more likely that this sale was a classic example of heirs lighting the proverbial fire sale in their haste to get rid of the asset. Heirs have no one to blame but themselves when they lose such a windfall, but woe be it to executors or trustees who do not do their due diligence and miss the mark on a profitable sale.
If you are set to inherit property, it’s a good idea to understand the responsibilities and the factors at play. You don’t need to become a real estate expert just yet, but it is a great idea to know what you’re dealing with. What if you are planning for your estate now? Do you know the value of the properties you might pass down, and is there something that can be done to teach your heirs about maximizing the value of the property?
You can learn more about this topic as well as other strategies on our website under the tab entitled: estate planning in Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning.
Reference: MarketWatch (March 19, 2014) “This NYC home’s price rose 54% in a week”