Everything you need to know about inheriting a property in 2025
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When it comes to property inheritance, many people tend to look at it with different lenses. For some, it may come with a lot of emotional baggage which can be quite hard to overcome. While, for others it can be seen as a financial burden, especially if they need to pay Inheritance Tax before probate can be granted. For most, however, it is often seen as a gift – that can help support retirement planning, fund a new home, or fuel future investments.
If you’ve directly inherited a property, selling may not be an immediate concern. However, if you are the executor of an estate, you may need to sell the property to settle any debts or distribute assets to beneficiaries.
Fortunately, whether you’re an heir or an executor, The Property Buying Company specialises in buying inherited and probate properties. Once probate is granted, we can help you sell the property in as little as 7 days, covering all legal and selling costs for you.
If you're exploring your options for inherited property, we offer many guides on each step of the process: managing taxes, choosing the best sales options, and understanding how to sell an inherited house efficiently.
How property Inheritance works
In the UK, 36% of people are projected to inherit property at some point in their lives. Additionally, inheritance has become a vital financial support for many, with 9 out of 10 adults relying on it to help fund their retirement plans, pay off debts and achieve long-term financial stability.
As house values rise, inheritances are increasingly seen not just as a windfall but as an essential part of financial planning for future generations.
If you have recently inherited a property, or about to, here is a brief outline of the property inheritance process:
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How easy is probate?
Probate can be a complex and time consuming process. In 2022, there were 234,711 applications for probate grants, with 12,891 of these applications not being approved. By late 2023, the average wait time for a probate grant has risen to 14 weeks – an increase of 6 weeks from the previous quarter, which shows the potential delays in the system.
Probate is the legal process required to manage and distribute someone’s assets (the estate) after they pass away. Here are some key terms to understand in this process:
Grant of probate: This is the official document issued by the court that gives executors the legal authority to manage and distribute the deceased’s estate according to the will. It is essential for accessing the estate’s assets and carrying out the probate process.
Executors: Individuals named in the will to carry out the deceased’s wishes. They manage the probate process, settle debts and distribute assets, including property, as specified in the will.
Beneficiaries: Individuals who inherit from the estate. After debts and taxes are settled, they receive assets or funds as directed by the will.
The will: This document outlines how the deceased’s assets should be divided, guiding the executors in distributing the estate to the beneficiaries.
Probate grants executors the legal authority to manage the estate, ensuring the will’s instructions are followed and that beneficiaries receive their inheritances. While necessary, probate can be challenging, especially if there are delays or complex assets involved.
Paying tax when you inherit
In 2022/23, over 41,000 people were liable to pay Inheritance Tax - the highest number in over 20 years. This increase is largely due to historically rising house prices and a frozen Inheritance Tax threshold, which has not kept pace with house values.
Here’s a quick overview of the taxes involved when inheriting a property:
Inheritance Tax (IHT):
This tax is usually paid on an estate worth over a certain amount (currently £325,000) when someone dies. If you inherit property, it may be subject to Inheritance Tax, but this is generally handled by the estate, not the inheritor.
Capital Gains Tax (CGT):
If you later sell the inherited property for more than its value at the time of inheritance, you might need to pay Capital Gains Tax on the profit. This doesn’t apply if you keep the property or it’s your main home.
Stamp Duty Land Tax (SDLT):
Normally, there’s no Stamp Duty when you inherit property, but you may need to pay it if you later purchase the remaining share of an inherited property or buy out other inheritors.
Sales process and options
Traditionally, selling an inherited property involved listing it on the open market with an estate agent. However, in recent years, especially the past five, there has been a significant rise in people choosing to sell inherited properties to cash buyers.
One main reason for this shift is the lengthy probate process. By the time the property is ready to go on the market, it may have been tied up in probate for 6 to 12 months. Selling through an estate agent can extend this timeline further, potentially keeping the property on the market for another 6 to 12 months, adding to the wait and uncertainty.
Selling to a cash buyer on the other hand, provides a faster solution, allowing the property owner to complete the sale in as little as 7 days. Additionally, cash buyers often cover legal and estate agency fees, making this option both time efficient and cost effective for those looking to settle estates quickly.
1.Obtain probate & value the property:
If the deceased owned the property in their name, probate may be needed to transfer ownership. During this process, get a professional valuation of the property for accurate pricing and tax purposes.
2.Clear debts & prepare the house for sale:
Ensure any outstanding debts on the estate, like mortgages or bills are cleared. Clean, repair and stage the property to make it attractive to potential buyers.
3.Choose your sale option
Estate agents:
You can sell through an estate agent, who helps with pricing, listing and negotiating offers. There are three types:
Online: Lower fees, mainly digital marketing, and limited in person support.
Hybrid: Combines online listings with some in-person support, such as local property experts.
Traditional: Full service estate agents offering in person viewings, marketing and negotiation.
Modern: Full service estate agents offering the services for free to sellers.
Property auctions:
A quicker option where the property is sold to the highest bidder, often within a set timeframe. Auctions can attract cash buyers or investors looking for a quick purchase.
Cash house buyers:
These are companies who can buy your house quickly for cash. While they do offer a lower price than the market value, they provide speed and certainty, ideal for those wanting to offload inherited property quickly.
Sell your inherited home
Most people who inherit a property ultimately choose to sell or rent it out rather than use it as their primary residence, with only 12% opting to live in the inherited home. Selling can provide immediate financial relief, especially since the probate process can be costly, and many beneficiaries need to recoup expenses, including Inheritance Tax.
If you’re considering selling your inherited home, working with The Property Buying Company offers a fast and hassle free option. We can help you complete the inherited sale in as little as 7 days, covering all selling and legal costs to ensure a smooth process.
It’s important to note that we buy inherited properties Below Market Value, which allows us to speed the sale and offer the quickest turnaround possible, which can be particularly beneficial at the end of a long probate process. This trade off provides you with certainty and efficiency at a challenging time.
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