Sale of late mother's home for less than probate value

[Wincanton]

My brother and I have struggled to sell our late mother's home. She died two and a half years ago. We were the only beneficiaries, and have completed the probate process.

The property was on the market for some time and we realised that some decoration was necessary to attract a buyer, so removed the house from the market and carried out some renovations, and will soon put it back on the market. It seems inevitable that even with these works the house will sell for less than the probate valuation. We know it is possible to submit a claim for relief on the loss, but is it possible to offset or claim any of the costs we've spent on capital improvements?

[bd6759]

Sounds like the probate value was too high.

[MarkyW]

I am not a professional so I can't guarantee my answer is completely accurate, but my reason for replying is because I am wading through the same treacle as you are except for the opposite reason. ie, our house is expected to sell for more than the probate valuation because of the renovation.

Remember, probate valuation is an opinion of the value of the property at date of death. Any expenditure you make to improve the property later is your own choice and cannot be deducted from the estate. In fact, ASFAIK only funeral costs can be deducted from the probate total.

Clearly, the question is how much lower would the price have to be for it to sell in the condition it was at date of death. As bd6759 said, the original valuation was too high. Work from that direction.

[Wincanton]

Thank you both for your replies.

I believe you are indeed correct and that costs cannot be deducted, it wasn't clear from everything I've read, though suspected as much. Yes it would appear that the valuation was too high, but at least we can expect some tax back. I look forward to drawing a line under things so we can move on.

Best of luck dealing with your situation Marky.

[MarkyW]

Thank you Wincanton, and the same to you.

The house I am dealing with was my parents home since 1976 and it is depressing every time I set foot inside. Depressing obviously because of the loss, but depressing also because of how much the house has fallen into disrepair.

For probate, I got two valuations for the property. One from an estate agent, and another from a surveyor. Being an average house, I was expecting to see broadly similar valuations but I was stunned find there was over £100k difference between the two. When I challenged them it became clear why there was such a difference. The estate agent based the valuation on the best price you could expect if it was offered to the market. The surveyor on the other hand, gave the minimum price I could expect if I wanted to get shot of it.

So one report says "Popular location, excellent local schools/amenities, open views, 4 bedrooms" etc etc. The other said "3 bedrooms, structural faults, dangerous electrics, condemned boiler, asbestos chimney" and so on.