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Probate properties boost housing market

As probate properties are usually sold for less than their expected market value and owners are often keen to offload them quickly, this type of house sale is having a positive effect on the UK housing market which is only now struggling to recover.

The probate sale of a property after the death of the owner, with proceeds to be divided among heirs, usually proceeds relatively quickly if the probate process has been straightforward, as beneficiaries are keen to tie up all loose ends and recover the capital tied up in the house.

As there is often an emotional connection to the house, those selling the property may often not have the sale price at the top of their agenda.

Valuing a property for probate differs from the typical estate agent valuation, in that it does not rely upon the current property market. Inheritance tax will then be calculated on this valuation total.

With property, it is possible to spread Inheritance Tax payments over 10 years, but it is still necessary to pay interest on the unpaid tax in the meantime. So, many Executors, rather than holding out to achieve the best purchase price possible, try to encourage fast sales of probate property.  This of course attracts investors and property developers, which is helping to drive the market when ‘normal’ house sales are stalling.

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