Why an exact valuation is so crucial to a community of heirs
Time and again, the difficulty of dividing up a property among several heirs is the trigger of bitter family disputes that not infrequently end up in court. A valid arrangement between the various parties in a ‘community of heirs’ (‘Erbengemeinchaft’) often fails to materialise owing to the lack of a fundamental prerequisite: a clear idea as to what the property is actually worth and which debts must be deducted from the property’s value.
Very few people will immediately know the right thing to do when they have inherited a property together with other named heirs. Perhaps one party wishes to move into the property themselves, while others will wish to sell it as quickly as possible so that the proceeds can be divided up among the heirs in a straightforward manner. Yet before the community of heirs can discuss how to proceed, they must always first establish the exact value of the estate to be divided up.
A professional valuation is the first step
A frequent problem in inheritance disputes over property is that the stakeholders have failed to take the first and most crucial step of having the property valued. Without a precise valuation, however, disputes further down the line regarding the property’s value are virtually guaranteed. By contrast, a professional valuation conducted at the outset is ‘the ideal scenario’, according to lawyer and property expert Sven Johns. This is because the value of the estate to be divided up, and who is entitled to which portion, is then clear to all stakeholders. It is important that the property valuation is based on a thorough, professional assessment. A rough estimate done with online price calculators or based on a few comparable properties is not especially useful. This is because it again creates the possibility for one of the parties to subsequently argue that the initial valuation was wrong – and to demand a fresh one.
Establishing the value of the remaining estate after discharging the debts
A frequent problem in inheritance disputes over property is that the stakeholders have failed to take the first and most crucial step of having the property valued. Without a precise valuation, however, disputes further down the line regarding the property’s value are virtually guaranteed. By contrast, a professional valuation conducted at the outset is ‘the ideal scenario’, according to lawyer and property expert Sven Johns. This is because the value of the estate to be divided up, and who is entitled to which portion, is then clear to all stakeholders. It is important that the property valuation is based on a thorough, professional assessment. A rough estimate done with online price calculators or based on a few comparable properties is not especially useful. This is because it again creates the possibility for one of the parties to subsequently argue that the initial valuation was wrong – and to demand a fresh one.
Have you inherited a property and require a valuation? Do you want to avoid any potential inheritance disputes by taking a professional approach from the outset? Get in touch with us! We are happy to advise you.
Not found what you are looking for:
http://www.mosler-partner.com/index.php/de/sven-r-johns
https://www.aktiv-online.de/ratgeber/die-erbengemeinschaft-was-ist-das-und-wie-verteilt-sie-den-nachlass-4439?gclid=EAIaIQobChMIxpbttOvN7gIVkYBQBh0TpQRcEAAYASAAEgIWqvD_BwE
https://www.ratgeber-erbengemeinschaft.de/blog/immobilie-erbengemeinschaft/
Legal note: This article does not constitute tax or legal advice in individual cases. Please have the facts of your specific individual case clarified by a lawyer and/or tax advisor.
