Selling an Inherited House in Brooklyn: How to Sell Inherited Property, From Probate to Closing

Stock photos of older homes and family keepsakes. Photos: Alican Helik, Ayşegül Aytören, Chris Alo, Zulfugar Karimov, fish socks on Pexels.

You inherit a property in Brooklyn: sell, rent or keep?

Before the paperwork, there is a decision. When families inherit a house, the choices are usually these, and each one changes what you do next.

• Sell right away. The most common choice when no one wants to live there. You avoid carrying costs, and the sale price is close to the date-of-death value, which keeps any taxable gain small.
• Rent it out. Possible, but you become a landlord, often at a distance, and the house usually needs work first.
• Keep it or move in. One heir may want to live there and buy out the others. That works best with a current value everyone trusts.
• Take a cash offer. Selling a house for cash to a company promises speed if you need to sell the house quickly. Before you agree to a cash sale, compare the number with what the house could fetch listed on the open market.

If the house had a reverse mortgage, call the loan servicer early: the loan generally has to be repaid once the last borrower dies, and acting fast keeps your options open.

What happens when you inherit a house: a quick checklist

• Find out how the title to the property was held. A house held in a living trust is usually property outside probate; the trustee handles the sale under the trust’s terms.
• Learn what the house is worth and whether there is a mortgage on the house. The equity in the property is what the family actually inherits.
• List what needs to be paid: property taxes, insurance, utilities and any loan, until the sale of inherited property closes.
• Think about selling costs before you set expectations: commission, transfer taxes and the attorney all come out of the sale.
• If you inherit a home in another state, the rules there differ. New York rules apply because of where the property is located, which is Brooklyn.

Who can sell inherited property in New York?

Not the people who inherit, on their own, at least at first. When someone dies owning a Brooklyn house, the person in charge of the estate, the executor or administrator, is normally the one who signs the contract to sell it.

• If there is a will, the executor named in it files the will with Surrogate’s Court in Kings County. Once the court accepts it, the executor receives letters testamentary.
• If there is no will, a family member asks the court to appoint an administrator, who receives letters of administration. The petition has to list any real property and its estimated value.

Either way, New York’s law on fiduciaries gives the executor or administrator the power to sell estate property, at a public or private sale, unless the will or the court order limits it. That surprises people. Many websites say an administrator always needs a judge’s permission to sell. That is not what the statute says.

The small estate shortcut does not usually help with a house. It is for estates with personal property of $50,000 or less, so a house generally goes through full probate or administration.

How long does the probate process take in New York?

In New York, the probate court is the Surrogate’s Court, and nearly every estate with a house has to go through probate or administration there. How long that takes has no official answer. The court does not publish average times, and estimates from New York estate lawyers disagree.

Our reading: plan in months, not weeks, and much longer if anyone challenges the will. One date does matter for planning. New York law protects an executor who pays out the estate in good faith after creditors have had 7 months from the issue of letters to make claims. That is one reason many executors wait before handing out the money from a sale.

The good news is that you do not have to wait until the probate process is finalized to put the property for sale. Once there are letters, the house can usually go on the market, go into contract and close.

What to do with the house while you wait

• Keep it insured. Tell the insurance company the owner has died, and ask whether the policy still covers an empty house.
• Keep paying the property taxes, the water bill and any mortgage, so nothing goes into default.
• Get a date-of-death value. You will need it for taxes later, and it is far easier to document now than in two years.
• Take out valuables and papers, and photograph the condition of every room.

Capital gains tax, estate tax and inheritance tax on inherited properties

Often less than people expect. The key rule is the step-up in basis. And New York has an estate tax, paid by the estate, not an inheritance tax paid by the people who inherit.

In plain terms: if Mom bought the house for a fraction of what it is worth now, you generally owe capital gains only on any rise in the value of the property after the date of death, not since she bought it. That is the biggest thing to consider when selling a house you inherited. And under federal tax rules, the gain or loss on inherited property is long-term no matter how long you held it. Talk to a tax professional before you sell the property, especially if the estate is large or the house was a rental.

That makes timing worth a thought. One to three family houses in Madison sold for a median of $1,325,000 this year, 6% more than the $1,250,000 median in 2025. If prices keep rising while a house sits, the gain above the date-of-death value can grow too.

Estate tax: usually not for a Brooklyn house on its own

For deaths in 2026, New York’s estate tax exclusion is $7,350,000 and the federal exclusion is $15,000,000. The typical Midwood house sold for $1,400,000 this year, far below either line. Larger estates should know that New York’s credit disappears quickly once the taxable estate passes 105% of the exclusion, so an estate can owe New York tax and no federal tax.

The transfer of the house to the heirs is not a taxable sale for New York’s transfer tax. When the estate later sells, the normal seller transfer taxes apply: 0.4% to the state and 1.425% to the city on a house over $500,000.

When siblings inherit a house together and disagree

This is the hardest part for many families, and it is not only a Brooklyn problem. A post on r/RealEstate this March, about a house in Texas a brother and sister inherited, drew 500 comments. She wanted to rent it out; he wanted to sell.

In New York, the options look like this:

1. Agree on a price, then buy out. A current valuation from an appraiser or a local agent gives everyone the same number to start from.
2. Sell and split. While the house is still in the estate, the executor or administrator runs the sale and the proceeds go out under the will or the law.
3. Partition, if all else fails. Once siblings own the house together, any one of them can ask a court to divide it or order a sale. When a house cannot be split, the court can order it sold at public auction, which rarely brings the best price.
4. The heirs property buyout. New York’s version of the Uniform Partition of Heirs Property Act gives family co-owners a right to buy out a sibling who asks the court to force a sale, at a value set by an independent appraisal. They have forty-five days after the value is announced to say they want to buy.

A partition case takes time and legal fees, and a forced auction may bring less than a normal sale. A blunt reply in the same thread suggested raising it to get a sibling to agree. Talk to an estate attorney before anyone files anything.

Selling inherited real estate that still has a mortgage

A mortgage does not stop a sale. The loan is paid off from the sale proceeds at closing, like any other sale.

If the family wants to keep the house for a while, federal law helps. Under the Garn-St Germain Act, a lender cannot call the whole loan due just because the house passed to a relative after the borrower died. It does not promise the family can take over the loan on the same terms. That is a conversation with the loan servicer, and it is worth having early so payments do not lapse.

What inherited homes in Midwood, Madison and Marine Park may be worth

Every house is different, and an older house that has not been updated can sell below the neighborhood median. Still, the median is a fair first look. Here is what one to three family houses sold for this year and last.

NYC Department of Finance: rolling sales file dated October 13, 2026 for 2026, annual sales data for 2025. One to three family houses, sales recorded January 1 to September 30 each year, at $100,000 or more.

Many inherited homes sell as they are, without a renovation first. Closing costs for the estate are the usual ones for selling a home: transfer taxes, the attorney and the commission. Our page on how we sell a Brooklyn house walks through each step, from pricing to closing.

Where The Behfar Team fits

When you decide to sell, a local real estate agent should give you a value before anyone signs anything. We sell houses in Midwood, Madison and Marine Park from our office at 1524 East 23rd Street, and we work alongside the family’s estate attorney and accountant rather than in place of them. We can give the executor a current market value, point the family to cleaners and movers we trust, and handle the sale once the letters are in hand.

These sales often come with grief and family history attached. Our agents speak six languages, including Hebrew, Farsi and Russian, which helps when relatives abroad need to follow along.

Sources

• New York Estates, Powers and Trusts Law section 11-1.1; Surrogate’s Court Procedure Act section 1002, section 1301, section 1802.
• Real Property Actions and Proceedings Law section 901, section 915 and section 993.
• IRS Publication 551 and Publication 550; IRS, estate and gift tax; NYS Department of Taxation and Finance, estate tax.
• Garn-St Germain Act, 12 U.S.C. 1701j-3.
• Ricaforte Law, Kings County Surrogate’s Court probate guide; Mishiyeva Law, how long probate lasts.
• NYC Department of Finance, rolling sales and annual sales data, Brooklyn.

Rules here come from New York State law and the IRS, current as of October 2026. This is general information, not legal or tax advice. An estate attorney and an accountant should guide your family’s decisions.