Tenants in Common Property Sale After Death - UK Guide for Executors and Co-Owners

Selling a property after the death of one tenant in common is different from selling a property owned as joint tenants. The deceased owner's share does not automatically pass to the surviving owner. Instead, that share becomes part of the deceased's estate and is dealt with according to their will or the rules of intestacy.

Understanding who has authority to sell, how the deceased's share is dealt with and how the sale proceeds are divided can help avoid delays and disputes.

What Happens When a Tenant in Common Dies?

When property is owned as tenants in common, each owner has a defined beneficial share. The shares can be equal, such as 50% each, or unequal, such as 70% and 30%.

When one owner dies, their share does not automatically pass to the surviving co-owner. It normally passes to their personal representatives and is then dealt with under the deceased's will or, where there is no valid will, the intestacy rules.

For example, if two people own a house as tenants in common with a 50% share each and one owner dies, the deceased person's 50% interest becomes part of their estate.

Can the Property Be Sold After One Owner Dies?

Yes, a property held as tenants in common can be sold after one owner dies, but the legal process needs to be handled correctly.

The surviving owner does not simply become the sole beneficial owner. The deceased owner's personal representatives will generally need to be involved in dealing with their share.

The conveyancing solicitor will establish the ownership structure, review the title and ensure the correct people have authority to complete the sale.

Does Probate Need to Be Obtained?

Where the deceased's share forms part of their estate, probate or letters of administration may be required to establish the personal representative's authority to deal with the deceased's interest.

The exact requirements depend on the circumstances, including whether there is a will and how the property is registered.

A solicitor handling the estate and property sale can confirm what documentation is required before the transaction proceeds.

What If There Is a Will?

If the deceased left a valid will, their share of the property normally passes according to the instructions in that will.

For example, someone could own 50% of a property with their brother as tenants in common and leave their 50% share to their children.

If the property is subsequently sold, the deceased owner's estate is entitled to the value of that share, subject to any relevant estate liabilities and expenses.

The surviving co-owner does not automatically inherit that share simply because they remain living in the property.

What If There Is No Will?

If the deceased died without a valid will, their share is dealt with under the rules of intestacy.

This can make the situation more complicated where several relatives may have an interest in the estate.

The surviving co-owner should therefore avoid assuming that they automatically inherit the deceased person's share.

Professional legal advice is particularly important where there are multiple beneficiaries or disagreements about the estate.

How Are the Sale Proceeds Divided?

The sale proceeds are generally divided according to the beneficial ownership interests, after taking account of the mortgage, selling costs and other relevant deductions.

For example, if one owner held 60% and the deceased owner held 40%, the net proceeds would generally reflect those respective interests.

HMRC guidance confirms that where land is held as tenants in common, each owner is entitled to their fractional share of the net sale proceeds.

The deceased owner's share would normally form part of their estate and then be distributed in accordance with the will or intestacy rules.

Example of a Tenants in Common Sale

Suppose a property is sold for £500,000.

The surviving owner owns 50% and the deceased owner owned the other 50%.

After deducting an outstanding mortgage and eligible selling expenses, suppose the net proceeds are £470,000.

The surviving owner's beneficial share would generally be £235,000, while £235,000 would form part of the deceased owner's estate.

The deceased person's £235,000 would then be dealt with through the estate administration process.

The figures will vary depending on the ownership agreement, mortgage, expenses, taxes and the terms of the estate.

What If the Surviving Owner Wants to Keep the Property?

The property does not necessarily have to be sold.

The surviving owner may be able to purchase or otherwise acquire the deceased person's share, subject to agreement with the personal representatives and beneficiaries and appropriate legal and financial arrangements.

This could involve obtaining a new mortgage or refinancing the existing property.

A solicitor should handle the transfer because the deceased's beneficial interest and the estate's rights need to be dealt with correctly.

What If the Beneficiaries Want to Sell?

If the estate needs to sell the property, the personal representatives can work with the surviving co-owner and the conveyancing solicitor to arrange the transaction.

In some situations, the surviving owner may want to remain in the property while beneficiaries want the property sold. This can create disagreements over timing, valuation and occupation.

Obtaining an independent valuation and professional legal advice can help establish a practical route forward.

What Happens to the Land Registry Title?

There is an important distinction between the legal ownership of the property and the beneficial ownership represented by the tenancy in common.

The death of one registered owner does not mean their beneficial share simply disappears. HM Land Registry guidance explains that the legal estate passes to the surviving legal owner or owners, while the deceased's beneficial interest continues to be dealt with through the estate.

The property solicitor will handle the appropriate Land Registry documentation and ensure the sale can be completed correctly.

Tax Considerations

The deceased person's share may form part of their estate for Inheritance Tax purposes.

There can also be Capital Gains Tax considerations if the property is sold during the administration of the estate and its value has increased after death. HMRC confirms that gains arising from the sale of estate assets during the administration period can be assessable on the personal representatives.

Because tax treatment depends on the circumstances of the estate, professional tax advice should be obtained where significant sums are involved.

Selling a Property Quickly After Death

Families sometimes want to sell quickly because the property is empty or because maintaining it creates ongoing costs.

These can include:

• Mortgage payments

• Council tax

• Insurance

• Utilities

• Gardening

• Security

• Repairs

• Property management

• Emergency maintenance

However, a rushed sale is not always the best option. The estate should consider the property's condition, current market value and whether limited refurbishment could improve the eventual sale price.

Preparing a Tenants in Common Property for Sale

Inherited properties can require significant preparation before marketing.

Depending on the condition, this may include:

• Clearing personal belongings

• Cleaning

• Garden maintenance

• Repairs

• Redecoration

• Damp treatment

• Electrical or plumbing work

• Locksmith services

• Security improvements

• EPC arrangements

• General refurbishment

Fraser Bond can help coordinate practical property works where the estate wants to improve the property's presentation before sale.

How Fraser Bond Can Help

Fraser Bond provides property sales, property management, refurbishment, maintenance coordination and wider property consultancy services across London and the UK.

For families, executors and surviving co-owners dealing with a property held as tenants in common, Fraser Bond can assist with property valuation, preparation for sale, refurbishment coordination, vacant-property management and the practical side of bringing the property to market.

Where legal or tax decisions are involved, the appropriate solicitor or tax professional should advise the estate. Fraser Bond can then support the property-related aspects of the process.