A Personal Representative’s Guide to Protecting, Valuing, and Making Decisions About Estate Property
When someone passes away owning a home, the property can quickly become one of the most important—and potentially complicated—parts of settling the estate.
For a Personal Representative, the responsibility goes far beyond deciding whether to put a For Sale sign in the yard.
Who is responsible for maintaining the house? Should the utilities stay on? What happens to the insurance? How should the property be valued? Should repairs be made? What if family members disagree about selling?
And ultimately:
Should the estate keep the property, distribute it, or sell it?
Before making that decision, here are several things Maryland Personal Representatives should consider.
1. Determine How the Property Is Owned
The first step is understanding exactly how the property was titled.
Not every property automatically becomes part of the probate estate simply because someone dies.
Depending on how ownership was structured, the property—or the decedent's ownership interest—may be handled differently.
Before making decisions involving the home, the Personal Representative should confirm ownership and work with the estate's attorney when legal guidance is necessary.
2. Protect the Property
Once you've determined that the estate has responsibility for the property, protecting the asset becomes a priority.
Consider questions such as:
- Is the property vacant or occupied?
- Is the home properly secured?
- Is appropriate insurance coverage in place?
- Are utilities still operating?
- Is routine maintenance being performed?
- Are there leaks, water damage, mold, pests, or other condition issues?
- Are mortgage payments, property taxes, condominium or HOA fees due?
- Does the property contain valuable personal belongings?
A property that sits unattended can deteriorate surprisingly quickly.
The first objective isn't necessarily to renovate or sell.
The first objective is to protect the estate's asset.
3. Understand What the Property Is Worth
Valuation is an important part of estate administration.
For a Maryland regular estate, a Personal Representative generally must file an inventory within three months after appointment. Applicable real property included in the inventory is reported at its fair market value as of the date of death.
But Personal Representatives may need to understand more than one value.
Date-of-Death Value
What was the property's fair market value when the decedent passed away?
Current Market Value
What could the property reasonably be worth in today's market?
As-Is Value
What could the estate potentially receive without completing significant repairs or renovations?
Potential Improved Value
What might the property sell for after appropriate improvements?
These numbers aren't necessarily the same.
Understanding the difference can help a Personal Representative make a more informed decision about what to do next.
4. Calculate the Cost of Holding the Property
An inherited or estate property isn't free to hold.
Every additional month may bring expenses including:
- Mortgage payments
- Property taxes
- Insurance
- Utilities
- HOA or condominium fees
- Lawn and exterior maintenance
- Cleaning
- Repairs
- Security
- Property preservation
Suppose an estate could potentially receive another $20,000 after renovating a property.
That sounds attractive.
But what if renovations, additional carrying costs, contractor expenses, and several extra months of ownership cost the estate $25,000?
That's why the highest sale price isn't always the best financial outcome.
The Personal Representative should consider the potential net benefit to the estate.
5. Decide: Keep, Distribute, Improve, or Sell?
There is no single strategy that works for every estate.
One beneficiary may want to keep the property.
The estate may need to sell it.
The home may be in excellent condition and ready for the traditional market.
Another property may contain decades of belongings and require substantial clean-out or repairs.
The Personal Representative's job isn't simply to ask:
“Can we sell the house?”
A better question is:
“What decision best protects the estate?”
That distinction matters.
6. Don't Automatically Renovate
Families sometimes assume they need to completely renovate an inherited property before selling it.
Not necessarily.
Before spending estate funds on improvements, determine whether those improvements are likely to produce an adequate return.
Consider:
What could the property sell for today?
What repairs are actually necessary?
What would those improvements cost?
How long would the work take?
What additional carrying costs would the estate incur?
What could the property reasonably sell for afterward?
Sometimes strategic improvements make financial sense.
Other times, cleaning the property, removing personal belongings, addressing immediate safety concerns, and selling the home in its current condition may be the better strategy.
The decision should be based on the numbers—not emotion.
7. Create an Estate Property Strategy
I believe probate real estate should begin with a property strategy, not a listing appointment.
Before deciding what to do with an estate property, evaluate four areas:
CONDITION
What is the property's actual physical condition?
VALUE
What is the property worth based on its condition and current market?
COST
How much is the estate spending to hold, maintain, repair, and protect it?
OPTIONS
Should the estate preserve it, distribute it, improve it, or sell it?
Once those questions are answered, the Personal Representative can make a much more informed decision.
Protect the Estate. Preserve the Legacy.
A family home can represent decades of memories, work, and accumulated wealth.
But during estate administration, it can also become an asset carrying significant financial responsibilities.
That's why my approach to probate real estate begins before a property reaches the market.
Assess the property.
Understand the value.
Identify the risks and costs.
Evaluate the options.
Then develop the strategy.
If you're serving as a Personal Representative in Maryland and the estate includes real property, I offer a complimentary 30-minute Probate Real Estate Consultation to help you better understand the property's condition, potential market value, and available real estate options.
Fred Dorsey
The Prince of Probate
Real Estate Broker
Navigating probate with expertise and integrity.
This article is provided for general educational purposes only and should not be considered legal, tax, accounting, or financial advice. Every estate is different. Personal Representatives should consult qualified legal, tax, and financial professionals regarding their specific circumstances.
