‘My brother wants to sell the house we inherited but I don’t’

My brother and I have inherited a house between us left by our late father. My brother wants to sell the house but I don’t. Therefore, I have agreed to buy his half.

Can you confirm if I am liable for stamp duty? And is it on the total property value or the half share that I will buy from him as my half share is inheritance?

The value of the house is €500,000 approx. I just need to know all the expenses that I will have before proceeding.

Ms L.D., Dublin

Are four credit cards better than three?

---

Pay off that loan before you focus on saving

---

Family arrangement on property could leave you both out of pocket

---

What’s a Fair Deal if wife follows late husband into nursing home care?

---

Inheriting physical assets with other family members always has the potential to throw up little difficulties. Everyone’s circumstances are different – financially and otherwise. People also have different levels of attachments to former family heirlooms or, as in this case, homes.

It is to your credit that you and your brother have moved quickly to clarify your positions and offer a way for both of you to achieve your ideal outcome: he gets the money he would receive from the house sale at its current market valuation and you get to hold on to something that is clearly important to you.

You’d be amazed how often these things descend into bitterness and legal dispute even among family members who would, heretofore, have been on good terms with each other. It can be devastating.

Compromise

The secret, as you have found is for both sides to be accommodating and open to a degree of compromise. Could the property achieve more on the open market? Possibly, but then again possibly not. And, regardless, you would both incur costs in marketing the property and paying legal and estate agent fees.

For peace of mind, the current market valuation is a very fair way for both sides to achieve “value” from the exercise.

In terms of your specific query, the answer is that you will have to pay stamp duty – but only on the portion of the home that you are buying from your brother, not on the part that you have already inherited in your own right.

The rate of stamp duty on all residential property valued at less than €1 million is 1 per cent. So that would be the rate you pay.

Assuming the house is valued at €500,000, your brother’s half is worth €250,000. That means you will have a stamp duty bill of €2,500 in respect of this transaction.

[ dcoyle@irishtimes.com ]