Advice on Inherited Property

[montreal08]

My brother and I have recently inherited a property (duplex).
Upon inheriting the property, my brother has decided that he wanted to sell his stake (50%) whereas I have decided that I want to keep the property.

My brother has gotten his own appraiser and got an appraisal of approximately $360k (I believe my brother is friends with the guy who did the appraisal).

The most recent official city evaluation was roughly $275k.
One house in the area has recently been put up for (coincidently?) $360k and sold for $340k.
Several other houses in the area have sold for much lower ($305k, $320k, etc).

Since my brother has every right to sell his stake in the property, I feel that he's trying to screw me (for lack of a better term) into selling his part at the highest possible price that a house in the neighborhood has ever sold for.
He has made claims that he doesn't care if I appraise it myself and find my own appraisal to be less than his and he has stated that if my appraisal was less than $340k that he would "put the house on the market and sell it".
Since he does not own 100% of the house, I don't find that he has any legal right to "put the house on the market" and sell the house since I legally own half of it.

1) Can I buy his stake of the house at the city's last property evaluation price?
2) Should I appraise it myself? If so, should I get multiple appraisals and are these free?
3) Does he have any legal standing at demanding half of $340k?
4) If I appraise it and find my appraisal to be e.g. $310k, will I be entitled to use that figure?
5) What course of action would ensure the fairest outcome?

Has anybody ever been in the same situation as me?

Thank you.

[Owbist]

Your brother does seem to be trying to get the better of you. Perhaps the easiest solution would be to sell and split the money 50/50 then you use yours as you see fit. He cannot sell without your signature, nor can he wander off with the loot as there will be a lawyer in the play.

Real estate appraisals are only guesses based on data available at the time of appraising. The actual selling price is the price the buyer and seller agree on at the time of signing the sales form.

[pitz]

My brother and I have recently inherited a property (duplex).
Upon inheriting the property, my brother has decided that he wanted to sell his stake (50%) whereas I have decided that I want to keep the property.


Going to court and asking for a judicial sale is an option in such case.


Since my brother has every right to sell his stake in the property, I feel that he's trying to screw me (for lack of a better term) into selling his part at the highest possible price that a house in the neighborhood has ever sold for.
He has made claims that he doesn't care if I appraise it myself and find my own appraisal to be less than his and he has stated that if my appraisal was less than $340k that he would "put the house on the market and sell it".


He just can't arbitrarily sell the property any more than you can. He would need your consent to sell the property, just like you would need his consent to sell the property.


Since he does not own 100% of the house, I don't find that he has any legal right to "put the house on the market" and sell the house since I legally own half of it.


No, in such a case, if he attempts to sell the house, you could apply for an injunction, and ultimately, for a judicial sale. Without your consent, there would be a serious problem conveying the property, to say the least.


1) Can I buy his stake of the house at the city's last property evaluation price?


No.


2) Should I appraise it myself? If so, should I get multiple appraisals and are these free?


You can invite an appraiser to the property to give you an opinion. But ultimately, absent an agreement between you and your brother, a judicial sale would be the only remedy you could extract under the law.


3) Does he have any legal standing at demanding half of $340k?


He is entitled to half of the proceeds of sale, but he has no right to arbitrarily sell the property without your explicit consent.


4) If I appraise it and find my appraisal to be e.g. $310k, will I be entitled to use that figure?


No.


5) What course of action would ensure the fairest outcome?


Either come to an agreement with your brother, or ask a judge to order a judicial sale. In other words, you should be seeking independant legal advice.

You would be entitled to bid at a judicial sale. Obviously if he outbids you at a judicial sale, then you would receive half of his bid as the proceeds. If you outbid him, then you would have to pay him half the price of the house. If someone else outbids you both, then you split the proceeds.

[sillysimms]

I can't answer all of your questions and you may need to obtain professional advice. Hopefully in the long run this doesn't cause problems between you and your brother.

I see you're in Montreal. I don't know how often the city's evaluations are done there. I know where I live they aren't done every year and our current value listed on our property tax bill is not what our property is actually valued at so I don't think you can use that as the value of the property.

What was the appraisal that was done based on? What comparables were used? Were the other comparables properties that sold for $360? Were the other properties that sold for $340, $305, $320 etc. comparable to yours? For example, were they duplexes, with comparable lot sizes, same number of bedrooms, bathrooms etc. All this will make a difference.

You can get your own appraisal, but there will be a charge.

You ask if you get an appraisal for $310, can you use that. It's the same as him saying he has an appraisal for $360, can he use that. This is why I think you may need to seek professional advice. Try not to let this ruin your relationship with your brother.

If you can't agree, the best scenario may be to put the property on the market and sell it for what the market will allow. That's the only way to know 100% what it is worth. An appraisal is an estimate but you will never know for certain what a property is going to sell for. If you can't agree on anything, unfortunately the best thing may be to sell and split the profits 50/50 so that no one is getting ripped off. If you don't want to do that, you'll have to come to a mutual agreement on the value of the property.

[jande9]

Both of you are joint tenants and you are both considered to own 100% of the property, so he can't sell his "half" to anyone. Both of you need to agree to sell the property.
If you buy him out the deed will show both of you as the sellers and just you as the buyer. This may even trigger capital gains for you as well.
You can buy him out if you want but finding a price is of course the hard part. You can pay for market appraisals or you can get some real estate agents to do a market appraisal, but ultimately the price is only what someone is willing to pay. Your brother can offer his share to you at a price and it is up to you if you want to accept it or you can counter offer. Of course, family unity is extremely important so a spirit of compromise should prevail.