Does the State have a problem with death and property? Right now, there’s a heated debate about inheritance tax in the lead up to Budget 2025.
A house is typically the most valuable asset in the deceased’s estate, and its sale can release the biggest part of an inheritance – except we seem to have a block when it comes to selling them.
More than 27,000 properties in the Republic are vacant because their former residents are deceased, according to Census 2022 figures. That’s more than twice as many homes than there were for sale across the State at the end of July this year. The number of second-hand homes on the market then was just 12,785. That’s a drop of 7 per cent since last year, according to analysis by estate agent Sherry FitzGerald.
Connacht, after Ulster, has had the largest drop in houses for sale since 2020, according to the analysis. While the number of homes for sale there has fallen off a cliff, there is a large number remaining vacant after a death.
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Indeed, Roscommon (25 per cent), Mayo (25 per cent) and Galway County (24 per cent), are the counties that had the most vacant properties because the owner had died, according to census figures.
Some houses, vacant after a death, are vacant for a year or two. Others are vacant much longer. The reasons are numerous, but they point to people and systems struggling to deal with a property after a death.
Homeowners who do not make a will, or who make an unclear one, are part of the reason homes remain vacant for so long after a death. There can also be family disputes over the home, probate delays, beneficiaries wanting to delay tax liabilities, as well as regulations which make renting out the property more hassle than it’s worth. The result is that thousands of vacant homes are lying empty.
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Where there’s a will, there’s a way
Estate agent Brian Dempsey of DNG in Stillorgan comes across plenty of vacant homes on his beat.
“There would be times when we are out canvassing for a sale and putting things in letterboxes and you are coming back to the same door six months later and you are still seeing your flyer from the last time stuck in the door. It’s sad to see so many houses sitting there,” says Dempsey.
He operates in the prime residential areas of Stillorgan, Clonskeagh, Foxrock, Mount Merrion, Goatstown, Leopardstown, Dundrum, Ballinteer, Kilmacud. The death of the owner isn’t the only reason for vacancy of course, but in this part of ‘old Dublin’, it’s definitely part of the reason, he says.
Indeed, in Dún Laoghaire Rathdown, there are 453 homes vacant because the former resident was deceased, according to census figures. There were 432 in South Dublin and 1688 in Dublin city.
When you are dealing with an executor sale, you are also dealing with grief, says Dempsey. It can be tough to make decisions about selling a home when feelings are heightened. Some of the wait to sell is down to a family’s’ grief. In other cases, it’s because there isn’t a will.
Solicitor Bernadette Parte gives the example of a widowed parent of four children who has not made a will. Without a will, nobody has been specifically appointed as executor to administer the estate.
“Any one of those four children can take out a grant of administration, [the name for the intestate grant of probate]. That means time can be wasted in terms of who is doing what,” says Parte. “One family member may decide to do it, and the others may think they are not appropriate. That can lead to litigation,” says Parte.
“If you have four siblings, one might be still getting over the bereavement of Mum or Dad’s loss, one might be about to lose their own home due to financial difficulties. So, often, one is pushing for the sale and the other is slowing it down,” says Brian Dempsey.
The house will likely remain vacant until beneficiaries can agree what to do.
Make it clear
Making a will can decrease the time a property sits in limbo, and one with clear directions about what to do with a house is more helpful again. Administering even a straightforward estate – like a house, a couple of beneficiaries and a couple of bank accounts, can take a year, says Parte.
Simple estates, but with a wide network of beneficiaries can take much longer. Where the deceased had a house and one bank account, but names 30 beneficiaries, a solicitor must get dates of birth, PPS numbers and details of prior gifts for all of them.
“You write to them looking for this information, they give you one bit and you go back and say, can you give me the other bit,” says Parte. Those living overseas won’t have a PPS number and must apply for one. It all takes time.
Those making a will can also assist beneficiaries and speed things up by being clear about what happens to a property.
“Some children might say they want to keep a house in the family, or ‘my son is going to university, I’d like him to live in it’”, says Parte. “You can have people moving into vacant houses and claiming rights over them. Then there’s the difficulty of getting them out. It is much more straightforward if there is a direction in the will for it to be sold,” she says.
“You can put a clause into the will saying, I want the house to be sold and who you want the proceeds to go to. That removes the decision, it makes it really straightforward,” says Parte.
“It’s a mess when somebody doesn’t make that provision in a will – [there’s debate about] the value of the house, or ‘I should have first dibs on buying it’ – anything like that will delay things.”
Choose executors wisely
Being an executor can be a tough job and it’s not for everyone. Don’t feel you have to appoint your children as executors, or that you have to appoint all of your children as executors, says Parte.
“How well do your children get on, if you appoint all three of them as executors, I always ask, ‘Do they actually get on, are they capable of making decisions together?’” says Parte.
“You can see a family blown up over things and the parent isn’t even dead yet. They are fighting in advance. You are leaving a mess if you think you must appoint the children simply because you’ve got three kids and therefore you must appoint all three of them,” she says.
Sometimes two of five children for example are appointed as executors and all the children will be beneficiaries. The executors have to make the decisions as to what is best for everybody, and what is in the best interest of administering the estate as expeditiously as possible, says Parte.
While consultation is good, a good executor will keep things moving.
“That’s another clause that you can put in the will that I always do, and it says something along the lines of, ‘the executors’ decision is final,’” says Parte.
Probate delays
Delays with processing probate applications have contributed to houses remaining vacant for longer too. Wait times extending to 20 weeks last year have dropped to about 13 weeks now for applications made by a solicitor, says a spokesman from the Courts Service. However, this is where applications are error free. Personal applications made by individuals are ten to 11 weeks, he says.
“In the past number of years, some sixty per cent of applications were being returned to solicitors due to errors,” the spokesman says. “This slows up the processing of cases.”
Solicitors need to gather a lot of information on each beneficiary for a probate application, says Dempsey.
“If you have a grandchild who lives in the UK or the US and they don’t have a PPS number, that can’t go through probate until they get one,” says Dempsey.
One of the main reasons for delays is the number of invalid and incorrect applications received, says the Courts Service. Small errors and omissions mean queries back to the solicitor. The processing time is also affected by speed at which the solicitor responds, says the Courts Service. Some applications are submitted several times without mistakes rectified, it says.
Some solicitors are faster at probate than others, says Brian Dempsey.
“We see many now are using one solicitor in their firm, dedicated to only working with the Probate Office. We do find in those instances that probate is faster. These people do probate only and they can anticipate issues,” says Dempsey.
A new system of eProbate launching mid-2025 will enable the public or solicitors to submit and track probate applications using a public portal, says the Courts Service.
Information will be validated at the time of submission. This will enable the Probate Office to get on with processing complete applications instead of corresponding on incomplete ones, it says. This should reduce waiting times.
Fast sale, slow sale
Where the home of a deceased person is put on the market too soon, before probate has even been granted, this can scupper the sale, further extending its vacancy.
“Properties are being put on the market for sale and contracts are exchanged when the solicitor should know that a grant of probate is required,” says the Courts Service.
“Many occasions have arisen where house sales have reached this point and probate applications have not even been made,” it says.
This can have costly implications. Where a potential buyer’s mortgage approval is only valid for six months, or where interest rates are in flux, buyers and their banks can get tense and pull out.
There used to be an ‘expedite’ option in the probate process, but this was not being used as intended, says the Courts Service.
“Where probate was looked for on an expedited basis, half of the reasons given were that the probate application had not been made before the house went up for sale,” an official says.
Sellers and buyers of homes should be made aware of probate processing times before they enter into contractual arrangements, or sales can be delayed or lost.
Death and taxes
Some estates are delaying making a probate application to avoid a tax bill in the same year. A lot of people might leave probate until the second half of the year which means the house is left there empty as well, says Dempsey.
The date the grant of probate issues dictates the date you have to pay tax, says Bernadette Parte. If the grant of probate issues on August 31st 2024 for example, you have to pay capital acquisitions tax on or before October 31st this year, she says. If the grant of probate issues on September 1st, beneficiaries have until October 31st 2025 to pay the gift or inheritance tax.
It all adds to the delay in selling homes made vacant by a death.
