Strategies To Utilize When Selling The Family Home

OCEAN CITY — Among life’s transitions, dealing with a family estate — and the sale of the family home — may be the most trying. Few transactions have the potential to be as emotionally charged. Yet those emotions can interfere with the many important decisions that family members must make together.
“Even if you all agree that it’s necessary to sell the house, you may disagree on a range of details, from which real estate agent to use to how long to wait before lowering the price if it doesn’t sell quickly,” says Michael Liersch, director of behavioral finance for Merrill Lynch.
While it can be difficult to deal with the sale of a family home, planning for how its proceeds might fit into your financial strategy can help you separate your emotions — and your memories of happy times spent there — from the practical decisions that need to be made. Here are eight strategies to help you and your family manage the process.
Establish a leader. Whether the executor is named in the will or chosen by heirs, he or she must be willing and prepared for a complex, time-consuming task, says Merrill Lynch Retirement and Personal Wealth Solutions National Sales Manager, Amanda N. Ross. Whether you hire a professional executor or handle the duties yourself, one family member should take charge of conveying family decisions to the executor, real estate agent, contractors or other professionals, and — most important — of making sure all family members are informed of each development.
Build a professional team. For some families, the primary goal is to maximize the profit on the home sale; for others it’s to sell quickly, Liersch notes. “Your financial advisor can help the whole family think through that process and reach a common goal. In addition to your advisor, your team should include legal help and a good real estate agent with experience in estate sales.” Ross adds that because probate rules vary from town to town and court to court, “an experienced estate lawyer will guide you through the process and help you avoid delays and unnecessary costs.”
Take an emotional roll call. “Have each family member write down what the house means to them, the good memories as well as any negative ones,” Liersch suggests. Getting these feelings out in the open will help everyone understand where the emotions lie, and how those emotions could affect such decisions as agreeing on a fair price for the house.
Give everyone a voice. Set a clear process and ground rules for sharing opinions and reaching consensus. Depending on where people live, meetings could be face-to-face or via e-mail or Skype, but everyone should have equal access to information and the opportunity to be heard.
Set a time frame. Establish that there is a beginning, middle and end to the process. Set deadlines for each crucial phase.
Secure the home. Change the locks as soon as the house is vacant, since you don’t know who might have obtained keys over the years. Make sure the home stays fully insured against theft and natural disasters. Thieves tend to gravitate to empty homes, so consider installing alarms or even alerting local police as to who is authorized to enter the house.
Continue maintenance. Maintenance lapses often lower the curb appeal and potential sales price.
Develop a strategy for the proceeds. After the house has been sold and all the creditors are paid, the executor may then distribute funds to heirs according to the terms of the will. Speak with your financial advisor about the best ways to put your share of the proceeds to work toward a new generation of family goals.
(A Merrill Lynch Wealth Management Advisor who can be reached at 410-213-8520.)