When applying for probate you will have to obtain a probate valuation of any and all properties owned by the deceased. The value of the property must be reported in your application for probate on the relevant inheritance tax form. You must provide a valuation for a property that the deceased had any sort of ownership of this includes joint names and tenants in common.
In most cases, a property is the most expensive asset in a person’s estate and for that reason, it is crucial to get an accurate representation of its value. For estates close to or over the inheritance tax allowance the value of the property can affect the amount of inheritance or capital gains tax you will have to pay. The value that you provided in your application will be check by a district valuer and if they were to question your application you must be able to justify your valuation.
There are two main types of probate valuations, an estates agents valuation and a surveyors valuation. Which one you use will depend on the specifics of the individual estate, your solicitor will provide you with information and advise on which type of valuation will be necessary.
Estate Agents Market Appraisal for Probate Valuation
An estate agent’s valuation will normally consist of a market appraisal that details the property type and condition. This information is then used as a comparison against recently sold property in the area culminating in a market price that the agent feels they can obtain for the property if it were to be sold.
Usually when dealing with a smaller estate that is not subject to inheritance tax an estate agents valuation will normally be sufficient and is less expensive than a RICS probate valuation, in order to apply for probate. When the estate is nearing the inheritance tax band the probate office may require at least three agent valuations in order to provide a grant of probate.
An estate agent’s probate valuation or market appraisal is often provided free of charge as the agent will be bidding to take the property on to their books and fulfil the sales transaction. The estate agent will then charge a commission on the sale and in turn be paid for his services at the end of the transaction. However, if the property is not going to be sold the agent may charge a fee upfront for the probate valuation/market appraisal.
Included as part of our probate service is an Estate Agent market appraisal, we liaise directly with the solicitor you have instructed through us and arrange for an agent to visit the property at a time convenient to you. Once the agent has completed their market appraisal that information will be provided directly to your solicitor so that there is no delay in progress.
RICS Probate Valuation
When a property is above the inheritance tax threshold then a RICS (royal institute of charted surveyors) probate valuation may be required. RICS surveyors have a royal charter and their probate valuation is indemnified by insurance.
RICS Chartered surveyors follow a set of professional standards set out in the ‘Red Book’ which is issued by Rics. The Red Book details mandatory practices and best guidance practices for members undertaking Valuation Services.
A Rics chartered surveyor after visiting the property will provide you with a probate valuation report that is fully compliant to the HMRC inheritance tax laws. RICS valuations will look at property use, condition and market factors in more detail than a market appraisal. For that reason, as a professional body, the probate office may require a RICS probate valuation as it is often deemed to be more accurate.
The cost of a valuation from a charted surveyor can vary but will normally cost in excess of £400.
Final Duties regularly work with hundreds of estate agencies across the country and employ a specialist probate property team. Our team will always seek to deliver the most cost-effective valuation for your estate and work with the agent to reduce sale costs. We will find a RICS chartered surveyor in your area and provide you with quotes for their services, then arrange for them to visit the property when it is convenient for you.
Probate Valuation Property Price Search
Before obtaining an estate agent market appraisal or a RICS Valuation you can start to research the potential value of the property but comparing prices of other properties in the area that are on the market. You can get an idea of prices by using property comparison websites like Zoopla from there you can make a reasonable estimation of what the potential probate valuation will be.