OverviewYou and the Beneficiaries will need to decide how the real estate assets will be dealt with depending on the ownership and the Will. Specifically, you will need to:
- determine ownership of the real estate;
- check if the Will mentions how the real estate are to be distributed;
- agree how the real estate will be distributed;
- determine if any maintenance is needed to get a higher valuation;
- decide if any deceased estate property is to be sold and the cash proceeds distributed;
- decide if the real estates are to be rented out; and
- update the simplyEstate Assets & Liabilities Inventory.
17.1 Types of Ownership
17.1.1 Sole Ownership
If the deceased person was the sole owner of the home or other property, then those properties will generally fall within the estate and will be distributed as outlined in the Will or based on legislation in your State/Territory.
17.1.2 Joint Tenants
If the deceased person owned the home or other real estate with another person jointly, then those properties will in most cases not form part of the deceased estate as they transfer to the surviving joint tenant. Further instructions may be noted in the Will.
Refer to Step 30.3.3 – Transfer Real Estate to find out how to transfer property to the surviving joint tenant.
Note: Where both joint tenants have passed, those properties will generally fall within the estate.
Note: Where both joint owners have passed, those vehicles will generally fall within the estate.
17.1.3 Tenants in Common
If the deceased person owned the home or other property with another person in common, then the portion owned by the deceased person generally falls within the estate and will be distributed as outlined in the Will or based on legislation.
17.1.4 Mortgaged Property
If the home or other real estate owned by the deceased is still mortgaged at the time of death, then the mortgage for a property will also transfer to the Beneficiaries with the property.
The mortgaging bank will in most instances have the right to expect all moneys owed. This means that if the property is sold and cannot cover the outstanding mortgage, then other assets need to be sold to repay the mortgage in full (see Step 14.4 – What are Creditors).
The deceased may have Mortgage Protection Insurance in place that covers the mortgage payments in the case the insured dies (see Step 25 – Claim Insurance & Other Benefits).
17.2 The Will (if Available)
The Will may contain specific details and instructions on the distribution of the home and other real estate. The requests in the Will should be upheld to the extent that the law permits.
17.3 Value the Property for Deceased Estate Purposes
As with all assets and liabilities of the estate, you will need to get a good understanding of the property value for the purposes of tax, Grant of Probate application and final distribution. A general rule is to either get a paid valuation by an independent specialist valuer, or free appraisals by three different real estate agents to allow you to arrive at an average value.
If the property will ultimately be sold, the value may be less important as the final sales price will determine how much money will contribute towards the total estate value. However, where a property is distributed to a beneficiary, the valuation may be of greater importance to other beneficiaries for an equitable and fair distribution.
If you foresee that the value of the property may be a contentious topic among beneficiaries and it may be difficult to arrive at an agreed value from the free appraisals, a professional valuation is recommended.
Note: the value of all assets and liabilities are as at the date of death.
17.4 Rent Out Deceased Estate Property
It may seem a good idea for the Executor to rent out property of the deceased estate to generate income during the administration process. However, based on legislation the Executors or Administrators can only enter into rental agreements upon receipt of a Grant of Probate or Letters of Administration (see Step 27 – Apply for Grant of Probate or Letters of Administration).
If deceased estate property is already rented out to tenants, the lease agreement continues between the tenant and the Executors or Administrators.
Should you need to terminate the current lease agreement you will need to provide notice in the appropriate period as outlined per the lease agreement.
Should a lease agreement come to an end during the estate administration process and the tenant requests their bond to be returned, you or the letting agent need to contact the relevant Authority in your State as follows:
Consumer Protection – Department of Mines, Industry Regulation and SafetyPhone: 1300 853 829
Opening Hours: Monday – Friday, 8:30am – 4:30pm AWST
Address: Level 2 (Reception), 140 William Street (please use the public entrance off Railway Lane from the Murray Street Mall), Perth, WA
Email: [email protected]
Post: Bond Administrator, Locked Bag 14, Cloisters Square WA 6850 Relevant Documents
The bond can be claimed by completing and submitting either a Disposal of Security Bond Form or Variation of Security Bond Form with:
- a copy of the Death Certificate;
- a copy of the Will; and
- a copy of the Executor’s proof of identity;
- a copy of the Grant of Probate or Letters of Administration (see Step 27 – Apply for Grant of Probate or Letters of Administration); and
- a copy of the Executor’s proof of identity.
The Consumer Protection – Department of Mines, Industry Regulation and Safety website can be accessed here.
Fair Trading NSWPhone: 13 32 20
Opening Hours: Monday – Friday, 8:30am – 5:00pm AEST
Address: Service NSW Centre near you
Email: [email protected]
Post: Locked Bag 9000, Grafton NSW 2460 Relevant Documents
- Claim for Refund of Bond Money Form;
- Copy of the Death Certificate;
- Copy of the Will stating the Executor or Administrator; and
- Identification for Executor or Administrator nominated in the Will.
The Fair Trading NSW website can be accessed here.
Residential Tenancies Bond Authority (RTBA)Phone: 1300 137 164
Opening Hours: 9:00am – 5:00pm AEST
Lodge Online: You can lodge here
Address: Find a RTBA near you here
Email: Submit an online enquiry here
Post: RTBA, Locked Bag 007, Wendouree VIC 3355 Relevant Documents
- Bond Claim Form, which you need to generate through the online RTBA Online tool, signed by the tenant(s) and Executors or Administrators;
- Death Certificate;
- Statutory Declaration from the Executors or Administrators; and
- Identification for Executor or Administrator nominated in the Will.
The Residential Tenancies Bond Authority (RTBA) website can be accessed here.
Residential Tenancies Authority (RTA)Phone: 1300 366 311
Opening Hours: Monday – Friday, 8.30am – 5:00pm AEST
Lodge online: You can lodge here
Post: RTA, GPO Box 390, Brisbane QLD 4001 Relevant Documents
- a Death Certificate; or
- an Interim Death Certificate;
- a copy of the Grant of Probate or Letters of Administration (see Step 27 – Apply for Grant of Probate or Letters of Administration); or
- original Statutory declaration.
The Residential Tenancies Authority (RTA) website can be accessed here.
17.5 Sell Deceased Estate Property
It is not uncommon that the Executor or Administrator either require to or wish to initiate the sale of real estate during the administration process. It needs to be noted that final transfer of title and land can only occur once a Grant of Probate or Letters of Administration are obtained from the Supreme Court (see Step 27 – Apply for Grant of Probate or Letters of Administration).While the estate administration is in progress, you as the Executor or Administrator can put the property on the market and enter into a contract for sale contract so long as:
- the Executors or Administrators are listed as the vendors; and
- special conditions are added to clarify that:
– the buyer is aware of the property being sold by Executors or Administrators;
– the sale is conditional on the Grant of Probate or Letters of Administration being granted by a specific date (note Grant of Probate applications can take multiple weeks or months depending on complexity); and
– the settlement of the property will take place within a specific period after Grant of Probate or Letters of Administration being granted.
If the Grant of Probate or Letters of Administration are not obtained within the specific time frames, the buyer has the right to exit from the contract.
Refer to Step 30.3.3 Transfer Real Estate for detailed instructions on how to transfer property to the estate for sale.
Actions and Decisions to Complete Step Yourself
If you have decided to tackle this Step yourself after reading and understanding the above, you may want to:
- Determine the ownership of all deceased estate property
(see Step 17.1 above);
- Check the Will (if available) about any specific instructions about how the property is to be distributed
(see Step 17.2 above);
- Value the property for probate
(see Step 17.3 above);
- Negotiate deferral or pay all mortgage payments for property that is mortgaged
(see Step 17.1.4 above);
- Decide if the owned property will be kept vacant, rented out or sold
(see Step 17.4 and Step 17.5 above); and
- Return a rental bond if a property was rented out and the lease ended
(see Step 17.4 above and forms below); and
- Update the simplyEstate Assets & Liabilities Inventory with all real estate and their value.
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Cost & Effort
Reading: 20 mins
Completing: 1-3 hrs
Total: 1:20-3:20 hrs
Cost: $0 – $1,000
Effort and cost are general estimates only and are based on the assumption that you complete this step without experienced support.
To find out how this Process Guide works, access the instructions here.
To find out what the capitalised words mean, access the glossary here.
Rental Bond in NSW
Rental Bond in VIC
Bond Claim Form, which you need to generate through the online RTBA Online tool
Refer to Step 17.4 above for more detail about these forms.
Other forms not listed here may be required based on your specific circumstances.
Checklists & Tools
Use Australia’s smartest Assets & Liabilities Inventory to automatically calculate the estate value for Grant of Probate.
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