Selling parents' house due to relocation to nursing home
Is it becoming increasingly difficult for your parent(s) to take care of themselves at home, for example due to dementia or physical limitations? Then comes the difficult moment of moving to a nursing home and selling your parents' house. In this article, we'll guide you step-by-step through the sales process, so you are well-prepared and everything goes smoothly.
Step 1: Find out who the owner of the property is
To sell your parents' house, all owners (this can be one or more people) need to sign for:
- the sales order to the real estate agent;
- accepting an offer from a buyer;
- signing the purchase agreement at the real estate agent; and
- signing the deed of transfer at the notary.
It is therefore important to first find out who the owners are. You can find out the owner(s) of the property by logging in to www.mijnoverheid.nl (under the 'Wonen' tab). Log in both yourself and with your parent(s) to see who is registered as the owner with the Land Registry.
Property is in the name of the surviving parent
In many cases, it is the surviving parent who eventually moves to a nursing home, because he or she can no longer live alone at home. It is possible that the property is only in the name of this surviving parent.
Property is in the name of a deceased parent
But it is also possible that the property is still in the name of your deceased parent, with your surviving parent as co-owner. In that case, a declaration of inheritance must be obtained. Only then can the property be put up for sale.
Children are co-owners
It is also possible that the children are co-owners, such as in the situation where the property was in the name of the deceased parent and the children have inherited a portion. It is even possible that the children are co-owners if the property is in the name of your surviving parent, provided he or she purchased the property during a marriage in community of property and the partner passed away before 2003 without a will.
In that case, the rules of the old inheritance law apply, stating that the children of this deceased parent automatically became co-owners of the property. These rules remain in effect even if the children are not registered as co-owners with the Land Registry.
Read more about inheriting a property here.
Step 2: Have a declaration of inheritance drawn up at the notary if necessary
If the (co-)owner of a property has died, a declaration of inheritance is needed. This is a notarial deed stating who the heirs are and who is authorized to act on behalf of the heirs. It is useful to have this deed registered with the Land Registry. It is wise to compare the prices of different notaries for drafting the deed, as prices can vary significantly.
It is becoming more common for real estate agents to ask for the declaration of inheritance before they start with the sale of a property. This clarifies who the owner is and who is authorized to sell and deliver the property. This prevents the wrong person from signing the purchase agreement and avoids unnecessary delays and problems in the sales process.
Banks or other financial institutions also often want to see a declaration of inheritance before they cooperate with the sale of the property. Furthermore, a declaration of inheritance provides the buyer with certainty that they are buying the property from the rightful heirs and prevents potential legal complications.
Step 3: Engage a real estate agent and put the property up for sale
If your father or mother moves to a nursing home, there is a lot to arrange. You organize all the administration for registration at the nursing home, change addresses with institutions, investigate whether there is entitlement to allowances and subsidies, decide (together with your parent) which furniture and belongings move to the nursing home, and ensure that the transfer of medical records and medication is properly arranged.
Additionally, it can also be emotionally difficult to see your parents move to a nursing home. It can be accompanied by feelings of guilt, loss, and concern about their well-being. Therefore, it is pleasant to be supported by an experienced real estate agent in the sales process of the property. This professional has experience in the local real estate market and takes a lot of work off your hands during this challenging time.
Choosing a good real estate agent
In our article about choosing the right real estate agent you can read what to consider when selecting a suitable real estate agent. If you have found a pleasant real estate agent, they can only put the property up for sale once the owner(s) have signed.
If your parent is unable to sign, for example, because they cannot be present physically or are incapacitated (e.g., due to dementia), there are 3 possible ways for you as a child to arrange these matters for your parent.
- Register for free and without obligation at Mijn Verkoopmakelaar
- Receive proposals from the best real estate agents in the area
- Compare based on costs, performance, and personal connection
- Over 3000 people have preceded you
- Competitive rates
- On average, 2% higher sales proceeds
Enter postcode and house number and receive multiple proposals in your mailbox in the coming days.
- Free
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Step 4: Make the property ready for sale and accept the best offer
Now that your parent(s)' house is for sale, it's important to make the property ready for sale. Start by thoroughly cleaning and tidying the house so that potential buyers get a good first impression from the photos and during viewings. In our article about making your home ready for sale you can read our golden tips.
Is there any deferred maintenance? Consider making small repairs so that the house looks attractive to potential buyers. In our article about renovating your home for sale you can read what you can tackle.
Do you expect that the current decor of the house will deter potential buyers? Or is the house half empty because many pieces of furniture have already been moved to the nursing home? Then you might consider restyling the property to make it more attractive to buyers. This can have a positive impact on both the number of viewers and the sales proceeds. Your real estate agent can inform and advise you about this.
Of course, it is important to discuss and consult on all of this - as far as possible - with your parent. This way, you can come to decisions together that fit the wishes and comfort of your parent. When bids come in, consult with your parent and your real estate agent to accept the best offer, taking into account the conditions and financial situation of the potential buyer.
To accept an offer, the owner's signature is required. If your parent cannot sign, there are 3 possible ways you can arrange these matters for your parent.
Step 5: Conclude the sale and arrange the transfer
After accepting an offer, the phase begins in which the sale is finalized and the transfer of ownership is arranged. The real estate agent or notary prepares a purchase agreement in which all agreements are recorded, such as the sale price, the dissolving conditions and the date of transfer.
The notary then checks the ownership papers and arranges payments and the drafting of the deed of transfer. Eventually, the transfer of the property takes place at the notary. The owner(s) of the property must sign the purchase agreement and the deed of transfer.
Is it not possible for your father or mother to sign these documents? Consider the situation where your parent is not mobile and therefore cannot physically come to the notary, or is incapacitated due to dementia or another condition. There are several ways you can still sign on behalf of your parent. You can read them below.
Signing on behalf of your competent parent
If your parent can still decide on the sale of the property, then he or she is competent. In that case, you can sign on behalf of your parent through a notarial power of attorney.
The sales power of attorney
With a sales power of attorney, your parent can authorize you to act on his or her behalf in the sale of the property. This is useful if your parent cannot be personally present at the signing of the purchase agreement or at the transfer, for example due to mobility problems.
The power of attorney can include various powers, such as engaging a real estate agent, approving an offer, and signing the purchase agreement and deed of transfer. The condition is that your father or mother is competent at the time the power of attorney is given.
It is wise to arrange the power of attorney well in advance, for example a few weeks or days before it is needed. You normally do this at the notary's office. But because that is not possible now, the notary can come to your parent's home to collect the signature.
Some offices charge extra costs for this. It is therefore wise to compare the total costs for drafting the power of attorney with each other. These can differ per notary's office.
The living will
Another option is to have a living will drawn up. This notarial power of attorney authorizes you as a child to act on behalf of your parent in various important matters, such as selling a property, managing bank accounts, insurance, and arranging care. This power of attorney goes further than just selling the property.
For a living will to be drawn up, your parent must be competent. Often this power of attorney is drawn up preventively before there is actually a need for it. But you can also have this document drawn up when your parent is already in a nursing home.
Notaries can also charge different rates for drafting this power of attorney. It is therefore wise to compare different notaries before making a choice.
Is there already a bank power of attorney? Pay attention!
If there is already another power of attorney, such as a bank power of attorney, you should know that these powers of attorney generally end as soon as your parent becomes incapacitated. Therefore, it is wise to have a living will drawn up. A living will remains valid even if your parent becomes incapacitated in the future, for example due to dementia.
Signing on behalf of your incapacitated parent (e.g., with dementia)
If your parent is no longer able to decide on the sale of the property, for example due to dementia, then you can act as an authorized representative if a living will or sales power of attorney has been drawn up by the notary in which you are listed as the authorized representative.
Note: the validity and circumstances in which you can act as an authorized representative depend on the specific conditions and provisions in the document itself, as well as the legal and medical status of your parent at the time of the action.
Requesting guardianship at the subdistrict court
If no notarial power of attorney is recorded, you must request guardianship at the subdistrict court to make decisions for your incapacitated parent. This process can take longer than drafting a power of attorney and can delay the sales process.
You must also explain to the court why the property needs to be sold and provide evidence for determining the sales price, such as an appraisal report. Only when the judge agrees can the sale proceed.
What if your father or mother dies before the property is sold?
At the moment your parent dies, the guardianship ends. The tasks that were previously with you as a guardian are now transferred to the heirs. Often the guardian is also an heir (e.g., as a child of a demented parent). In that case, the sale can simply continue. You no longer need permission from the subdistrict court.
Is there a different situation, then contact your real estate agent or discuss your situation with a notary or lawyer. These professionals can advise you on the best solution.
Read more about selling your parents' property after death.
Step 6: Receiving the sales price and paying the personal contribution
If your parent's property is sold, the notary ensures repayment of the mortgage if there was still an amount outstanding. The notary's fees and the real estate agent fees are also paid from the sales proceeds by the notary. Depending on the specific situation, there may also be other costs settled through the notary, such as any costs for removing mortgages or other charges on the property.
If there is still money left over, this surplus value is paid out to the owner(s). If your parent is competent, he or she can simply dispose of the received money. If your parent is incapacitated, it depends on the specific situation who has control over the money.
- Has guardianship been requested at the subdistrict court? Then the guardian oversees the money. As a guardian, you are generally not allowed to make donations.
- Is there a bank power of attorney in place? At the moment your father or mother becomes incapacitated, this bank power of attorney expires. Even then, you cannot make donations.
- Is there a living will drawn up at the notary? As an authorized representative, you may make donations in that case.
The ability to make or not make donations can have important tax consequences, especially for a parent moving to a nursing home. The amount of the personal contribution to the nursing home is partly determined by the assets of the older person. By transferring assets in time through donations, it may be possible to lower the personal contribution, which can be fiscally beneficial.
Contact a financial advisor, notary, tax advisor, or a lawyer specializing in inheritance law for reliable advice.
