When you inherit a house you inherit a decision as well. Keep it, rent it, or sell it. Most people who reach out to us are somewhere in the middle of that, often while living in another city and paying for a property they never planned to own.
First, Find Out How the Property Transfers
You usually cannot sell an inherited house the moment you inherit it. How the title passes determines what you can do and when.
- Living trust. The cleanest path. The successor trustee can generally sell without going through probate.
- Joint tenancy or community property with right of survivorship. Title passes to the surviving owner, usually with an affidavit rather than a court case.
- Transfer on death deed. Passes directly to the named beneficiary.
- No estate plan at all. This is where probate comes in, and it is the slowest route.
California also has simplified procedures for smaller estates. The dollar thresholds for those changed recently, so confirm the current figures with a probate attorney rather than relying on an article.
Two Tax Points Worth Knowing
Stepped up basis
For federal capital gains, the property is generally valued at what it was worth on the date of death, not what the original owner paid. If your parents bought in 1985 for 90,000 dollars and the house was worth 400,000 when they passed, your basis is usually the 400,000. Sell near that and the taxable gain can be small.
This is the single most misunderstood part of inheriting a house, and it is why selling is often less painful tax wise than people expect.
Property taxes under Proposition 19
Since 2021, an inherited home generally keeps its low property tax assessment only if a child moves in and claims it as a primary residence, and even then there are limits. If you plan to rent it or leave it empty, expect the property to be reassessed at current market value.
For a house held in a family for decades, that reassessment can multiply the annual tax bill. It is a common reason heirs decide to sell rather than hold.
None of this is tax advice. Talk to a CPA before you make the call.
The Costs of Waiting
An empty inherited house is not free to own. Property taxes, insurance, utilities, and yard work continue. Vacant home insurance costs more than a standard policy, and many carriers will not cover a house left empty for months without a rider.
Then there is the condition problem. Homes that stayed in one family for thirty or forty years usually need a roof, systems work, and a full clear out. If you live out of the area, coordinating that from a distance is its own job.
If Several People Inherited It
Siblings often want different things. One wants to keep it, one wants cash, one does not want to deal with it. A sale is frequently the only option everyone can actually agree on, since it converts a shared asset into something divisible.
All the heirs on title have to sign. Sort that out early, because discovering a disagreement at closing is expensive.
You Do Not Need to Clean It Out
People spend weekends hauling forty years of belongings to the dump before calling us. If you are selling to a buyer who plans to renovate, that work is wasted. Take what matters to your family and leave the rest.
Selling an Inherited House Around Sacramento
We buy single family homes and condos in any condition across the Sacramento area, the Central Valley, and the East Bay, including Sacramento, Modesto, Elk Grove, and Manteca. We work with out of state heirs regularly and can handle everything remotely through a licensed title company.
Call or text (916) 848-7081, or send us the address. No cost, no obligation, and no pressure to decide before the estate is settled.
General information only, not legal or tax advice. Estate and property tax rules are specific to your situation. Consult a probate attorney and a CPA.