Inheriting Your Parents’ House? Here’s a Full Guide on What to Do and Whether to Sell

Losing a parent is one of the hardest things most of us will ever go through.

And then, in the middle of the grief, you’re handed a stack of paperwork and told you need to deal with probate, taxes, insurance, and decisions about a house you grew up in.

Nobody really prepares you for that.

This guide walks you through everything you need to know about inheriting your parents’ house in England and Wales. From the legal steps you need to take first, through the tax implications, to the big decision: keep it, rent it, or sell it.

We have been buying inherited properties for over 20 years, and probate sales are one of the most common reasons people come to us. So while we are not solicitors or tax advisers, we have seen just about every situation that comes up when someone inherits a family home.

Let’s start with what you need to do straight away.

First Things First: Immediate Steps After Inheriting

Before you make any big decisions about the property, there are several urgent practical steps you need to take.

Secure the Property

If the property is going to sit empty, even for a few weeks, you need to secure it.

• Change the locks. You do not know who else might have keys
• Let the neighbours know the property will be unoccupied for a while. They can keep an eye on it and alert you to any issues
• Switch the insurance. Most standard home insurance policies stop covering a property after 30 days unoccupied. You will need specialist empty property insurance, which typically costs more but is essential
• Set heating to a low level during winter to prevent pipe bursts and damp

Find the Will

The will determines who inherits the property and who has the authority to deal with it (the executor).

If there is no will, the estate is dealt with under the rules of intestacy. In England and Wales, this means:

• If there is a surviving spouse and children, the spouse receives a statutory legacy of £322,000 plus personal possessions, then the remainder is split: half to the spouse, half shared equally among the children
• If there is a surviving spouse and no children, the spouse inherits the entire estate
• If there is no surviving spouse, the children inherit equally
• Unmarried partners receive nothing under intestacy rules, regardless of how long the relationship lasted

Instead of an executor, the court appoints an administrator through a process called Letters of Administration.

Notify the Relevant Parties

You will need to notify:

• The local council (council tax department)
• Utility companies (gas, electric, water)
• The mortgage lender (if there is an outstanding mortgage)
• The insurance provider
• Royal Mail (to redirect post)

Understanding Probate

Probate is the legal process that validates the will and gives the executor (or administrator) the authority to manage and distribute the estate.

You generally cannot sell, transfer, or make major decisions about the property until probate has been granted.

How Probate Works in England and Wales

• Value the estate. This includes the property, savings, investments, and any other assets. You will need a formal property valuation for HMRC purposes. Get at least two or three estate agent appraisals to establish the market value at the date of death.
• Complete the Inheritance Tax forms. If the estate is above the IHT threshold, you will need to complete form IHT400. If the estate is below the threshold and straightforward, you can use the shorter IHT205 (or the equivalent online form).
• Submit the probate application. This can be done online through the government’s Apply for Probate service, or by post. Online applications are significantly faster.
• Pay any Inheritance Tax due. IHT on property must normally be paid within six months of death, even if the property has not yet been sold. You can apply to pay IHT on property in instalments over ten years.
• Receive the Grant of Probate. This is the legal document that confirms the executor’s authority. Once you have this, you can deal with the property.
• Administer the estate. Pay any debts, sell or transfer assets, and distribute the estate to beneficiaries according to the will.

How Long Does Probate Take?

The total process from start to finish typically takes 6 to 12 months for a straightforward estate, and can stretch to 18 months or more for complex ones.

The Grant of Probate itself currently takes approximately:

Selling the property then adds another 4 to 6 months on top, depending on how you sell.

Tax Implications of Inheriting a Property

This is where it gets complicated. Three different taxes can come into play when you inherit a property, and understanding which ones apply to you is important.

Inheritance Tax (IHT)

IHT is charged at 40% on the value of an estate above the available threshold. But the actual amount people pay is usually much lower than the headline rate suggests.

The average effective IHT rate for estates that did pay tax in 2022/23 was just 13%, not 40%, because reliefs and exemptions reduce the chargeable amount significantly (HMRC, 2025).

Here are the current thresholds:

So if you are a direct descendant inheriting your parents’ home, and the estate is worth less than £500,000 (or up to £1,000,000 for a married couple’s combined estate), there may be no IHT to pay at all.

But here is the issue: the nil-rate band has been frozen at £325,000 since April 2009. Had it risen with inflation, it would stand at roughly £500,000 today. That 17-year freeze means families who would have been comfortably below the threshold a decade ago are now being pulled into IHT purely by rising house prices (HMRC, 2026).

Capital Gains Tax (CGT)

You do not pay CGT when you inherit a property. The property’s value is “reset” to its market value at the date of death (the probate value). Any gains the deceased made during their lifetime are effectively wiped out.

However, if you then sell the property for more than the probate value, you will owe CGT on the difference.

The current CGT rates for residential property are:

• 18% for basic-rate taxpayers
• 24% for higher and additional-rate taxpayers

The annual CGT exemption is £3,000 per person for 2026/27.

If you and a sibling inherit the property jointly, you each get your own £3,000 annual exempt amount against your share of the gain.

Can You Reduce or Avoid CGT on an Inherited Property?

There are several legitimate ways to reduce your CGT exposure:

• Sell quickly after probate. The less time between the date of death and the sale, the less opportunity for the property to grow in value beyond the probate figure
• Move in and make it your main residence. Private Residence Relief (PRR) means you pay no CGT on a property that has been your only or main home throughout ownership. But this must be genuine occupancy, not a token gesture
• Deduct allowable costs. You can deduct estate agent fees, solicitor fees, stamp duty (if applicable), and the cost of improvements (but not repairs or maintenance) from the gain
• Use your annual exemption. The first £3,000 of gains each tax year is tax-free

Stamp Duty

Good news here: you do not pay Stamp Duty Land Tax (SDLT) when you inherit a property. SDLT only applies to property purchases, not to property received through inheritance.

However, if you later buy out a sibling’s share, SDLT may apply to that transaction depending on the value and your circumstances.

Your Three Options: Keep It, Rent It, or Sell It

Once probate is granted and the legal side is settled, you have three choices. Each has its own financial, practical, and emotional implications.

Option 1: Move In

Best for: People who genuinely want to live in the property, first-time buyers inheriting from parents, or those looking to downsize or relocate.

Advantages:

• Emotional continuity and connection to the family home
• No CGT liability if it becomes your only or main residence (Private Residence Relief)
• No selling costs (estate agent fees, conveyancing)

Things to consider:

• The property may need significant updating or repairs, especially if your parents lived there for decades
• If you already own a home, you may need to sell it first, and you will have two properties on your hands in the meantime
• If siblings also inherited a share, you would need to buy them out. This may trigger SDLT and will require a formal valuation
• Moving in must be genuine. HMRC can challenge a Private Residence Relief claim if the occupancy was brief and appeared to be motivated by tax avoidance

Option 2: Rent It Out

Best for: People who want a long-term income stream and are prepared to take on landlord responsibilities.

Advantages:

• Regular rental income
• Property retains potential for future capital growth
• Keeps the family home in the family

Things to consider:

• You become a landlord with legal obligations: gas safety certificates, electrical inspection condition reports (EICR), How to Rent document, deposit protection, and compliance with the Renters’ Rights Act 2025
• Rental income is taxable. You will need to declare it on your Self Assessment tax return
• If you later sell, CGT will apply on the gain from the probate value. There is no Private Residence Relief for a property you never lived in as your main home
• You will need landlord insurance, not standard home insurance
• In Wales, all private landlords must register with Rent Smart Wales
• The property may need work to meet the Minimum Energy Efficiency Standard (MEES), currently EPC rating E or above

Option 3: Sell the Property

Best for: People who need the funds, want a clean break, or do not want the ongoing responsibility of property ownership.

Advantages:

• Releases capital quickly
• No ongoing maintenance, insurance, or council tax costs
• Clean split between multiple beneficiaries
• Selling soon after probate minimises CGT exposure because there is less time for the property to rise in value above the probate figure

Things to consider:

• Estate agent fees (typically around 1.5% of the sale price)
• Conveyancing costs
• CGT if the property has increased in value since the date of death
• The emotional weight of selling a family home
• The property may need clearing, cleaning, and possibly some repair work to achieve the best price on the open market

The Hidden Costs of Holding an Inherited Property

One thing that catches many people off guard is just how much it costs to keep an inherited property while you are going through probate and deciding what to do.

These holding costs add up fast:

• Council tax. An inherited property qualifies for a Class F exemption from council tax during probate and for up to six months after the grant is issued. After that, you pay full council tax, and some councils charge a premium on empty properties
• Empty property insurance. Specialist cover is more expensive than standard home insurance, often £500 to £1,000+ per year depending on the property
• Utility standing charges. Even if you are not using the property, you will still pay standing charges for gas, electricity, and water
• Maintenance. Gardens overgrow, gutters block, damp sets in. An empty house deteriorates faster than an occupied one
• House clearance. A full house clearance for a three-bedroom property typically costs £500 to £1,500

Over 6 to 12 months, these costs can easily reach several thousand pounds.

What Happens If Siblings Inherit Together?

It is very common for multiple siblings to inherit a property jointly. This can work smoothly, but it can also create friction, particularly if you disagree on what to do with the property.

The main options are:

• One sibling buys the others out. This requires a formal valuation (get at least two independent valuations) and may require a mortgage or remortgage. SDLT may apply to the purchase of the other shares
• Sell the property and split the proceeds. The cleanest option, especially if siblings live in different parts of the country or have different financial needs
• Rent the property jointly. Requires a formal agreement about responsibilities, costs, and how income is split. All co-owners are jointly liable for the property and its obligations

If you cannot agree, the legal last resort is an application under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA) to force a sale. This is expensive, stressful, and best avoided through early, honest communication.

Practical tip: Get a written agreement in place early, even between family members. It does not need to be a formal legal document at first, but write down what you have all agreed and make sure everyone has a copy. If things get complicated, consult a solicitor before positions harden.

How to Sell an Inherited Property

If you decide to sell, you have several routes. The right one depends on your timeline, the property’s condition, and how much you need from the sale.

Option A: Sell on the Open Market via an Estate Agent

This is the traditional route and will usually achieve the highest price.

• Get at least three estate agent valuations and compare the probate value against the current market value
• Average time to sell is approximately 4 to 6 months
• Estate agent fees are typically around 1.5% of the sale price
• You will need to arrange an EPC (Energy Performance Certificate) before marketing
• The property may need clearing, cleaning, and possibly cosmetic work to show well

Option B: Sell at Auction

Auction can be faster than the open market, with a legally binding sale on the fall of the hammer.

• Good for unusual properties or those in poor condition that may struggle on the open market
• You will need to prepare a legal pack before the auction (typically £300 to £500)
• Auction fees vary but are typically 2 to 2.5% plus VAT
• There is no guarantee the reserve will be met

Option C: Sell to a Cash House Buyer

Cash buyers purchase directly, with no chain, no estate agent, and completion in weeks rather than months.

• Offers are typically 75 to 85% of market value, the trade-off being speed and certainty
• No estate agent fees, no viewings, no risk of the sale falling through
• Can buy in any condition, so no need for repairs, clearing, or decorating
• Completion in as little as 2 to 4 weeks

Real-World Example: The Cost of Waiting

We had a seller in the Midlands who had inherited a three-bed mid-terrace that had been sitting empty for eight months. Council tax, insurance, utilities, clearance costs: it was all adding up. By the time they contacted us, the holding costs had reached several thousand pounds.

We exchanged within a week and completed 28 days later, which stopped the bleeding.

In a separate case, a seller in London had inherited a property and tried selling at auction first. The reserve was not met, which happens more often than people think. They had spent money on legal pack preparation with nothing to show for it. We bought the property within four weeks, no legal pack needed.

These are common scenarios. The longer an inherited property sits empty, the more it costs you, and in some cases the more the property deteriorates.

The Emotional Side: Clearing the Family Home

This part is not about money or tax. It is about the fact that you are going through your parents’ belongings, and that is genuinely difficult.

A few tips from families we have worked with over the years:

• Take your time with personal items. There is no rush to clear everything in one go. Start with paperwork and practicalities, and leave sentimental items until you feel ready
• Work room by room. Trying to do the whole house at once is overwhelming. Focus on one room at a time
• Sort into categories: keep, donate, sell, and skip. Be decisive where you can, but do not force it with items that carry real emotional weight
• Ask for help. You do not have to do this alone. Family members, friends, or professional house clearance companies can share the load
• Take photos. Photograph rooms and special items before clearing. You will be glad you did

Frequently Asked Questions

Do I need probate to sell an inherited house?

In most cases, yes. You need the Grant of Probate (or Letters of Administration if there is no will) before you can legally sell the property. Some buyers, including cash buyers, can start the process while you are waiting for the grant, but completion cannot usually happen until it has been issued.

Do I pay Inheritance Tax on my parents’ house?

It depends on the total value of the estate. If the estate (including the house) is below the available thresholds (up to £500,000 per person, or up to £1,000,000 for a married couple passing the home to direct descendants), there is no IHT to pay. If the estate exceeds these thresholds, IHT is charged at 40% on the amount above the threshold. Consult a tax adviser for your specific situation.

Do I pay Capital Gains Tax when I inherit a property?

No. CGT is not triggered when you inherit. The property’s base cost is set at the market value on the date of death. CGT only becomes relevant if you later sell the property for more than that value.

Can I sell an inherited property before probate is granted?

You can market the property and accept offers before probate is granted, but you cannot complete the sale until the Grant of Probate has been issued. Some estate agents and cash buyers are experienced in handling pre-probate sales and can have everything ready to go as soon as the grant comes through.

What if there is a mortgage on the inherited property?

The mortgage does not disappear. It will need to be repaid, either from the estate, by taking on the mortgage yourself, or by selling the property and using the proceeds to clear the debt. Contact the lender as early as possible. Most will offer a grace period while probate is administered, but they will want to know their loan is being dealt with.

How much does probate cost?

The probate application fee is currently £300 (or free if the estate is below £5,000). Solicitor fees for handling probate vary widely, from around £1,500 to £5,000 or more depending on the complexity of the estate. Some solicitors offer fixed-fee probate packages.

What is the best way to sell an inherited property quickly?

If speed is the priority, a cash house buyer can complete in 2 to 4 weeks, compared with 4 to 6 months on the open market. The trade-off is price: cash offers are typically 75 to 85% of market value. For some families, especially those facing mounting holding costs on a vacant property, the speed and certainty outweigh the discount.