Many executors are worried about what to do with the real estate they control in probate estates. The fears of holding on to residential real estate in Riverside, San Bernardino and San Diego Counties is well justified. A recent newspaper article says we are in for another one to two years of declining real estate values. That article can be viewed here http://www.nctimes.com/articles/2008/07/01/business/z82ae2726b0f49f7a882574790075
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In the real estate market we have now executors are well advised to either sell their real estate at auction or use a real estate agent who is both well aware of current market prices and will recommend the price be reduced as needed to keep pace with a declining market. An auction has the benefit of finality and the likelihood of bringing a true market price for the property. A good auctioneer will advertise the upcoming sale for weeks before the scheduled auction. When auction day arrives the executor (and beneficiaries) can be confident the best possible price for the property will be obtained. Some recent auctions in southwest Riverside County have resulted in overbids because the properties were aggressively priced and the bidders then bid up the prices.
Using a traditional real estate agent can also work but the agent needs to be realistic with the executor. Everyone wants to hear they will get the price they want for their property. That’s not helpful in today’s real estate market. The executor should challenge the real estate agent to provide a realistic price based on current sales of comparable properties. With those prices in mind a sales price should be set with the realization that price may need to be reduced if the house does not sell quickly.
