When a Queens family loses a parent who held the deed to their home in their individual name, the next nine to twelve months belong to Surrogate’s Court. The children often assume they can simply empty the property, list the house for sale, split the proceeds, and move forward. They cannot. Until a judge officially appoints an executor or administrator, no one has the legal authority to sign a listing agreement, pay the property taxes from the deceased’s bank accounts, or transfer the title. Frozen.
For many families, the home is the physical embodiment of their legacy, representing decades of hard work and equity. Managing that asset after a death requires exactness. If a will names you to handle a loved one’s estate, understanding how the law views your role regarding real property is the first step toward a prudent administration.
The Immediate Burden of Fiduciary Duty
As soon as the court issues Letters Testamentary, the clock starts on the executor’s fiduciary duty. This is not merely an honorary title awarded to the eldest child—it is a strict legal obligation of stewardship. Similar to a trustee managing a trust, the executor becomes the legal custodian of the real property until it is sold or distributed. If the roof leaks during the first winter after the owner’s death, the executor must fix it.
One of the most immediate challenges we see involves carrying costs. Property taxes, utility bills, and mortgage payments do not pause for bereavement. Before the estate accounts are fully funded, the executor must keep the lights on and the property insured. If the property sits vacant, the executor must secure vacant property insurance—standard homeowner policies often lapse after thirty to sixty days of vacancy. Failing to secure the physical and financial integrity of the house is a breach of fiduciary duty.
Statutory Powers Under the EPTL
Executors often ask what exactly they are allowed to do with a house. While SCPA Article 14 governs the probate of the will, an executor’s power to manage or sell real estate falls under the Estates, Powers and Trusts Law. Specifically, EPTL §11-1.1 grants fiduciaries broad statutory powers to take possession of, manage, lease, and sell real estate—provided the will does not explicitly prohibit such actions.
We draft wills to intentionally include broad real estate powers so the executor never has to petition the court just to make a prudent decision about the property. However, if the deceased died without a will—triggering an administration proceeding rather than probate—the rules shift. The administrator may need court approval or the explicit consent of all heirs before selling the home.
Valuations and Generational Tax Strategy
Before a property can be distributed or sold, we must establish its baseline value. This requires a formal date-of-death appraisal. A real estate agent’s comparative market analysis might be helpful for setting a listing price, but it is entirely insufficient for the IRS or the New York State Department of Taxation and Finance.
We require a licensed appraiser to determine exactly what the property was worth on the day the owner died. This valuation dictates the step-up in basis. If the deceased bought a home in 1985 for $150,000 and it is worth $1.2 million upon their death, the heirs inherit the property at the $1.2 million value. When they sell it shortly thereafter, they pay capital gains tax only on the appreciation above that new baseline. It is a deliberate, generational tax strategy that relies entirely on an accurate, defensible appraisal.
Dealing with Co-op and Condo Boards
In Manhattan and Brooklyn, real estate often takes the form of a cooperative apartment, which introduces an entirely different layer of bureaucracy. A co-op is not real property—it is shares in a corporation tied to a proprietary lease. When the shareholder dies, the executor does not just list the apartment and sell it to the highest bidder. The co-op board maintains its right to approve or reject any prospective buyer, and in some cases, even the transfer of shares to a direct heir.
We spend considerable time working with managing agents and board attorneys to facilitate these transfers. The executor must continue paying the monthly maintenance fees while the apartment is empty, prepare the extensive board package, and wait for the board’s interview process to conclude. We plan for every contingency so the apartment does not fall into arrears while the board deliberates.
The Seven-Month Creditor Window
Real estate is a highly visible, illiquid asset. Creditors know this. When a house goes through probate, title companies will require proof that all claims against the estate have been satisfied or properly provided for before they will issue a clean title policy to a new buyer.
Under the law, creditors generally have seven months from the issuance of Letters Testamentary to present their claims. We spend a significant portion of the probate process ensuring that no hidden medical liens, outstanding credit card debts, or unresolved judgments derail a future sale. Stewardship means anticipating these roadblocks. An executor who rushes to distribute the proceeds of a real estate sale before paying a known creditor can be held personally liable for that debt.
Selling Versus Transferring Title
Ultimately, an executor faces two paths for probate real estate: sell the property and distribute the cash, or transfer the deed directly to the beneficiaries. The language of the will usually dictates this choice. If the will directs that the estate be divided equally among four children, selling the home is almost always the most prudent route. Co-owning a single-family home among siblings with different financial realities, different spouses, and different priorities usually invites conflict.
If the executor sells the property, they sign the deed on behalf of the estate. The proceeds are deposited into an estate account, where they are used to settle the final debts, pay legal and administrative fees, and clear any taxes before the remaining funds are distributed. If the property is instead transferred to the heirs to keep in the family, the executor signs an Executor’s Deed, officially moving the title from the estate to the beneficiaries.
Managing real property through probate requires exactness and a clear understanding of fiduciary duties. A family home is often the largest single asset in an estate, and mishandling its administration invites costly delays and familial fractures. If a Surrogate’s Court has recently appointed you as an executor and you need to understand your immediate responsibilities regarding a family property, schedule an initial estate administration review with our office to outline your next steps.
