Get a Realistic Opinion of the Market

As the personal representative, you have a fiduciary duty to get the best possible price and terms for the house to benefit the estate’s beneficiaries and creditors. To do this, you must not only know what the value of the house is, you must know the current state of the market.

Not knowing the market can cause the house to be sold for less than its true value or, alternatively, to sit for months without being sold, all the while incurring costs and expenses. What you want is the Goldilocks zone – something that is just right in terms of price and days on the market.

This almost always requires the expertise of a licensed real estate broker. A broker will know if the market is hot for condos, but slow for high-end houses. She will know if houses under $500,000 are moving quickly and without significant closing adjustments. He will know what a rough price for selling to a wholesaler would be.

A good broker also will factor timing into the equation.

Do you need to sell immediately, or can the estate or trust handle the cost of holding the house for a few months while some things are fixed, spring arrives, or interest rates drop.

It is important for you to discuss the financial position of the estate with your broker in addition to conducting an investigation of the property. All of these elements go into providing a high-quality market evaluation for your proposed sale. Knowing this information will allow your broker to discuss multiple scenarios with you regarding when and how to offer the house for sale. Having a broker with a CPRES designation often helps with the process of evaluation of the market for your specific probate or trust sale.

A CPRES also can help with the opinion of value you provide to beneficiaries, creditors or the court in the probate process. An opinion by a CPRES may carry more weight than one from a non-certified agent. This can be needed in the estate inventory required by CRS §15-12-706 of the Colorado Probate Code, which requires all personal representatives to inventory and determine the value of all estate assets.

A good real estate agent will not only provide you with a static evaluation of the market, but will also discuss trends occurring in the market. This is important because oftentimes in a probate or trust sale, there is lag between when the decedent dies, when the probate is opened, when the real estate agent is consulted, and when the house finally goes on the market. There may be significant issues to address in the house that can take a month or more to evaluate and solve. Knowing the trends in the market can help you time the listing to get the most for the house. For example, if you have an estate where the decedent died in November owning a house that could fetch a higher price with some repairs and modifications, you might consider doing such work during December and January, so the house is in top form for the spring rush of buyers. Alternatively, if the same situation occurred but the decedent died in August or September, you might not want to wait for the house to be fixed up, only to have to list it in December.

Just as with probating the estate, the value of a professional in this situation cannot be overstated. Having a deep knowledge of the market can mean tens of thousands of dollars to the estate.