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A step-by-step guide to selling a deceased estate

Selling a property left behind by a loved one can make a difficult time even more stressful. However, understanding how deceased estate sales work can ease the burden on you and your family.

The process involves a few steps, but rest assured that most things are relatively straightforward. If, however, there are family trusts, claims against the estate, a complicated will, or family members who believe they have been treated unfairly, it can become quite complex.

If in doubt at any time throughout the process, it is best to seek legal advice from a trusted lawyer before proceeding.

Breaking it down – Step by step

Here we take you through the basic process in the simplest way possible. Please be aware that this information should be used as a general guide only, as the laws and processes for selling deceased estates vary from state to state.

It is therefore important that you read and thoroughly understand the state-specific legal requirements. To help save you time and point you in the right direction, we have provided links to this information at the end of the article.

How long do I have to sell the house?

While there is no set time for selling a house after someone passes away, most are sold no sooner than six months, and before nine to twelve months.

According to the Australian Tax Office (ATO), when you choose to sell can impact the taxes incurred. You may be exempt from capital gains tax (CGT) on disposal of an inherited dwelling if:

  • you dispose of it within two years of your loved one’s death, and
  • either your loved one acquired the property before September 1985, or at the time of death the property was the main residence of your loved one and was not being rented.* 

If you dispose of the property outside of the two-year period, the exemption can still apply if the Commissioner of Taxation grants an extension of the two-year period.

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Important first steps – The paperwork

To begin the process, the executor applies for a grant of probate. A grant of probate is a legal document which gives an executor authority to deal with the estate of the deceased according to their will.

The exception to needing a grant of probate is if you hold a property as joint tenants (for example, when you’re part of a couple with assets in both names).

An executor might still enter into a sale contract before a grant of probate is issued, but a will cannot be administered – and settlement cannot happen – until after a probate has been received.

Alternatively, a beneficiary can apply for a grant of letters of administration. The executor then applies to have the title changed from the name(s) of the deceased to their own name.

Also very important, the Transfer of Ownership Needs to be organised. Unless the title has been transferred from the deceased to the joint tenant, executor, or personal representative, the property can’t be sold, or transferred to the purchaser.

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Preparing the house for sale

Despite a few exceptions, a deceased estate property sale is treated the same way as any other sale.

The executor will need to obtain multiple appraisals of the property from real estate agents, then collect multiple quotes for any costs related to selling the property. This includes real estate agent fees and contractor quotes if there are repairs to be done.

Keep in mind that there are many ways to sell a property and it’s important to consult an expert prior to making any decisions. Depending on the situation, there may be benefits to different methods of sale.

The executor then prepares the house for sale and works with the agent to list the property for sale.

It is important that the executor maintains transparency at all times, keeping beneficiaries informed throughout the process regarding valuation, property costs, and all details pertaining to the sale.

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Once the property is sold

When the property is sold, the executor distributes the funds to the beneficiaries, according to what is outlined in the will.

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State by state laws – Deceased estates

As mentioned, here are some links to information regarding the state-by-state rules and regulations relating to deceased estates.

Queensland

For further information visit the Queensland Government website.

Northern Territory

For further information visit Northern Territory Government website.

New South Wales

For further information visit the Supreme Court of New South Wales website.

Australian Capital Territory

For further information visit the Public Trustee & Guardian for the Australian Capital Territory website.

Victoria

For further information visit the Supreme Court of Victoria website.

South Australia

For further information visit the Public Trustee South Australia website.

Western Australia

For further information visit the Western Australia Government website.

Tasmania

For further information visit the Supreme Court of Tasmania website.

This guide is intended to give general advice only. Please speak to your legal and financial professionals for advice that is specific to your situation. Please note that information and tax law may change from time to time – all information provided within this document is correct as of February 2021.

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More resources

We hope this article has been helpful and provided a clear snapshot of the process involved when selling a deceased estate.

For guidance on other ‘practical’ requirements such as the immediate considerations when a loved one first passes, who you need to contact, arranging the funeral, and reviewing possessions left behind, please see our full Feros Care Bereavement Guide

This guide also provides resources to support you with the ‘personal’ side of loss, namely the emotional journey and grieving process. From tips to help you accept loss and search for meaning, to a list of carefully curated websites and telephone numbers to further assist you, we try to cover all the common pain points.

Remember, there is no one-size-fits all handbook for dealing with the death of a loved one, and we hope to make a positive difference during this difficult time.

Our expert team at Feros Care are available to contact via 1300 763 583.

Support is also available from Beyond Blue on 1300 22 4636 and Lifeline on 13 11 14.