Inherited a House With Siblings? Your Options When You Can't Agree
One wants to sell, one wants to keep it, and one lives there. New York law gives co-owners a way out, but the best outcome is usually reached before a judge is involved.
A parent dies and leaves the family home to the children in equal shares. Within a year, the disagreements start. One sibling wants to sell and divide the money. Another wants to keep the house in the family. A third has been living in it and has no plans to leave.
It is one of the most common real estate disputes there is.
What co-ownership means
When several people inherit a property together, they usually hold it as tenants in common. Each owns a share of the whole property, not a particular room or floor. Each generally has the right to use all of it. And no one of them can sell the entire property without the others.
That last point is what produces the stalemate. It is also why the law provides a remedy.
Option one: agree
Most of these disputes end in an agreement, and the agreements usually take one of three forms:
- A buyout. The sibling who wants to keep the house buys the others' shares at a price based on an appraisal.
- A sale. Everyone agrees to list the property and divide the proceeds, after accounting for what each has paid in.
- A written arrangement to keep it. The owners set out in writing who lives there, who pays the taxes, insurance, and repairs, and what happens if someone later wants out.
Any of these is nearly always faster and cheaper than litigation, and the family keeps control of the result.
Option two: partition
When co-owners cannot agree, New York law allows any one of them to ask a court to end the co-ownership. This is a partition action, governed by Article 9 of the Real Property Actions and Proceedings Law.
A court can physically divide land where that is practical. For a single house it almost never is, so the usual result is a court-ordered sale with the proceeds divided among the owners.
The division is not always equal to the shares on the deed. In the accounting, a court can consider what each owner has contributed toward things like the mortgage, taxes, insurance, and necessary repairs.
Extra protections for inherited property
When the property qualifies as "heirs property," generally meaning family property passed down by inheritance and held by relatives as tenants in common, New York adds steps before a sale can be ordered (Real Property Actions and Proceedings Law § 993). They include a settlement conference, an appraisal to establish fair market value, and an opportunity for the other co-owners to buy out the share of the one seeking the sale. If a sale does go forward, the statute favors a sale on the open market over an auction.
The purpose is to keep families from losing a home for less than it is worth.
What to do before it becomes a lawsuit
- Find out how title is actually held. If the estate was never administered, the house may still be in the parent's name, and that has to be fixed first.
- Get an appraisal that everyone accepts, or agree on how one will be chosen.
- Keep records of who has paid the taxes, insurance, mortgage, and repairs.
- Put any agreement in writing.
A partition action is sometimes necessary, and knowing it is available often brings a reluctant co-owner to the table. But it works best as leverage for an agreement.
If you co-own inherited property and cannot agree on what to do with it, call the office. For more, see Real Estate and Estate Planning & Elder Law.
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