Caring for a vacant Home
Managing Director, Head of Wealth Planning and Advice, J.P. Morgan Wealth Management
Administering a vacant home as an executor or trustee
Whether you are named as an executor or personal representative of an estate, or as a trustee or successor trustee of a trust that owns a home, the task may involve overseeing a property that has become vacant due to the owner's death. This responsibility includes ensuring the security and maintenance of the property, as failure to do so could lead to owing damages to the beneficiaries of the trust or estate. You should consult with your personal attorney regarding any concerns with the management of a vacant home in the estate or trust and your fiduciary responsibility.
In this article, we discuss some of the considerations if you find yourself as a fiduciary who owns a now-vacant residence.
Immediately after death
Upon the owner's death, securing the property is crucial. Vacant homes can attract unwanted attention, so to protect the home:
- Secure the property: Ensure all doors and windows are locked. Activate any security systems and update alarm passcodes promptly.
- Notify neighbors: Inform trusted neighbors of the situation and who will be managing the property to help identify unusual activity.
- Notify insurance: Notify the homeowners insurance provider about the death and the fact that the property is now vacant.
- Presence during funeral: Consider having someone stay at the house during the funeral to deter potential intruders.
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During the first few weeks of vacancy
Focus on removing valuables and sensitive items to prevent theft and misuse:
- Remove valuables: Safely store portable items like jewelry, electronics, and cash.
- Handle firearms: Comply with local laws for transporting firearms and understand your responsibilities.
- Dispose of medications: Use secure drop-off locations for medication disposal.
- Secure important documents: Store paperwork containing sensitive information securely.
Longer term vacancy considerations
If the home will remain vacant for an extended period, take steps to make it appear occupied:
- Use timers: Set lights and possibly a TV or radio on timers to create the illusion of occupancy.
- Manage mail and deliveries: Regularly collect mail and packages, and cancel newspaper deliveries.
- Maintain landscaping: Keep the lawn mowed and the driveway shoveled to avoid the appearance of neglect.
Keeping up with home maintenance is important
Regular maintenance is essential to prevent damage and ensure the property remains in good condition. Keep utilities like electricity active, which aids in maintaining the property and can be beneficial when selling. Prevent damage by heating the home in winter to avoid frozen pipes and keeping it dry in summer to prevent mold. Regular inspections can help identify and address issues such as missing shingles or clogged gutters.
Things to know when selling an residence
If selling the home is part of the estate administration, consider engaging a qualified Realtor and possibly a lawyer to navigate the sale process. Obtain an accurate appraisal to ensure the property is valued correctly. Maintain open communication with beneficiaries to prevent disputes and foster trust. If selling to a beneficiary, treat the transaction as a third-party sale and secure agreement from all beneficiaries.
Additional considerations
Fiduciaries are held to a higher standard than property owners. They must act in the beneficiaries' best interest, considering factors like carrying costs, market conditions, and appraised value when setting a sale price. Beneficiaries should be kept informed about estate matters, including realtor selection and listing price adjustments. Timing is important due to maintenance challenges and potential estate tax liens, requiring coordination with estate and real estate lawyers.
By following these guidelines, you can ensure the vacant home is well-managed and secure, honoring the legacy of the deceased while fulfilling your fiduciary duties.
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Managing Director, Head of Wealth Planning and Advice, J.P. Morgan Wealth Management
