As far as inheritance goes, properties are the most common assets left behind. Some decide to hold onto a property, while others believe the best move is to sell. However, issues may arise when a property is left to multiple siblings and they disagree over the best course of action. This is especially true if one sibling is already living in the property and refuses to move out or sell.
Here, we look at what happens when one sibling refuses to sell an inherited property.
What happens when two siblings inherit a property?
When inheriting property among siblings, careful consideration is needed before making decisions.
Checking the Will: first steps
Initially, examine the Will, as it may outline specific shares for each sibling. If the Will lacks clear instructions, siblings must decide on the property ownership type – either as joint tenants or tenants in common.
Joint tenants vs tenants in common
Joint tenants equally own the property, while tenants in common hold specified percentages, which can vary. Full siblings typically inherit equally, but this might differ in families with half or step-siblings.
Selling as joint tenants
As joint tenants, all siblings must consent in writing to sell the property. Post-sale, proceeds are equally divided among all joint tenant siblings.
Selling as tenants in common
As tenants in common, individual siblings can sell their share to others, including siblings, without needing consent from the rest. If all agree to sell, proceeds are split according to each sibling’s ownership percentage.
Determining ownership type
To identify your ownership type if the Will is unclear, use the Land Registry’s Property Search Service. Download the property’s title register. If Section B of the Proprietorship Register includes specific wording regarding sole proprietor disposals, the property is held as tenants in common.
What are the options when you inherit a property with siblings?
There are a few options on the table if you inherit a property with siblings. These include:
- Keeping the property and using it as a holiday home
- All agreeing to sell the property and split the profits
- All agreeing to rent the property and split the rental income
- One sibling buying out the other sibling(s)
- Apply to the court for an “order for sale”
- One sibling living in the property
What should I do if my sibling lives in the property and refuses to sell?
If you’re in the UK and find yourself in a situation where your sibling, who shares a jointly inherited property with you, refuses to sell, there are various approaches you can take. Initially, try negotiating directly with your sibling. If this proves difficult, mediation could be beneficial. This involves a neutral third party who can assist in reaching a mutual agreement.
Alternatively, If you’re keen on selling but your sibling wishes to remain in the property, consider a buyout. This would involve you selling your share of the property to your sibling. Another option is to enter into a rental agreement where the property is rented out and the income is shared.
If these methods don’t work, a more drastic measure is to apply for a legal ‘order for sale’ under the Trusts of Land and Appointment of Trustees Act 1996, compelling the sale of the property. This can be a lengthy and expensive route, so it’s advisable to seek guidance from a solicitor specialising in property law to explore all options and understand the implications of each.
Understanding the Residence Nil Rate Band (RNRB)
Regardless of you or your sibling’s decision to sell, it’s crucial to understand the RNRB, which provides an additional tax-free allowance for passing a family home to direct descendants. The maximum RNRB is £175,000, fixed until April 2028, but reduces for estates over £2m.
It applies to properties that were the deceased’s home at some point, including unique dwellings like static caravans or houseboats. The property can be within or outside the UK, but only one property can be nominated for RNRB. Investment properties never lived in by the deceased are ineligible.
When handling shared inheritance of property, it’s vital to consider all options, communicate effectively and understand the legal and tax implications to reach a fair and feasible solution for all parties involved.
Can I force the sale of an inherited property?
Whether some or all siblings wish to keep or sell a jointly inherited house, a sale cannot be forced by any single individual, and consensus among all is required, except where a court order is issued. While in theory, any sibling can sell their individual share of the house, finding a buyer for just a portion is highly unlikely, particularly when the remaining majority is held by siblings who are not in agreement.
What can I do if my sibling agrees to sell the home?
There are several routes you can go down if your sibling agrees with you and decides to sell the property.
Selling through an estate agent is the most traditional route. They will market your property, arrange viewings and negotiate with potential buyers to achieve the best possible price. This method provides a wide market reach but can take time, and agent fees will apply. So expect to pay at least a few thousand pounds.
Selling at auction can be faster than using an estate agent. It’s particularly suitable for properties that might attract investor interest or those requiring renovation. The selling price is determined on auction day, offering a quick and definite sale, but you might not always get the market value.
Property Rescue offers a different approach, providing a quick and straightforward sale process. Ideal for those looking for a fast resolution, we purchase properties directly, eliminating the need for estate agents or auctions. This option is particularly appealing if you need to sell quickly due to circumstances like probate.
The process is hassle-free, with no need for home improvements or viewings, and we can cover all legal fees. This makes it a convenient choice for anyone prioritising speed and simplicity over getting the maximum sale price.
Summary: Selling an inherited property with a sibling
Inheriting a property with a sibling is a complex subject that needs a lot of thought and care. If you’re not on the same page, the best move is to communicate and see if you can come to an amicable resolution. Should your sibling agree to sell the property, we can provide you with a free, no-obligation quote and see the sale through swiftly for minimum fuss and hassle over such a delicate topic.