Probate Valuation: A Solicitor's Guide for Executors
Someone has died, you are the executor, and one of the first things you are told is that you need a value for the house. What nobody explains is what sort of value, who is allowed to give it, or how careful you need to be about the figure you write down.
Most executors have never done this before, and the advice online contradicts itself. Some pages tell you three estate agents are compulsory. Others tell you a surveyor is essential. Neither is quite right.
This page sets out what a probate valuation actually is, when a free estate agent letter will do and when it will not, and why this single figure carries more weight than almost anything else you will do while administering the estate. It covers England and Wales, where the law differs from Scotland and Northern Ireland.
At a glance
• HMRC does not want the asking price or an insurance figure. It wants the open market value of the property on the date of death.
• There is no general requirement to obtain three valuations, however, 2 normall suffice and GOV.UK does not ask for a specific number. What matters is that the figure is properly reasoned and you can show how you reached
• A written estate agent valuation is usually accepted where the estate sits comfortably below the tax thresholds. Where inheritance tax is payable, a RICS Red Book valuation is the safer route.
• The figure does two jobs. It sets the inheritance tax now, and it becomes the base cost for capital gains tax if the property is sold for more later.
• HMRC can refer any property valuation to the District Valuer at the Valuation Office Agency, who will check it against sale prices and survey data of their own.
• Getting it wrong costs money in both directions. Undervaluing risks penalties of up to 100% of the extra tax. Overvaluing means paying inheritance tax at 40% on value that was never there.
• Keep everything. HMRC can ask to see your records up to 20 years after inheritance tax is paid.
On this page
• What is a probate valuation?
• Do I need an official house valuation for probate?
• How many valuations do you need?
• Probate value versus market value
• What it costs and how long it takes
Legal Terminology Explained
| Term | What it means |
|---|---|
| Probate valuation | The value of an asset on the date its owner died, worked out so it can be entered on the inheritance tax account and relied on by HMRC. It is not the asking price and not the insurance figure. |
| Open market value | The price the property would reasonably have fetched if sold on the open market on the date of death, in the condition it was actually in. The test comes from section 160 of the Inheritance Tax Act 1984. |
| Red Book valuation | A formal written valuation by a RICS chartered surveyor, prepared to the RICS Valuation Global Standards. The surveyor states the basis of valuation, identifies comparable evidence, and is professionally accountable for the figure. |
| Chattels | Personal possessions rather than land or buildings: furniture, electrical goods, jewellery, cars, antiques, artwork and collections. They form part of the estate and are valued on the same open market basis. |
| District Valuer | HMRC's own property valuer, part of the Valuation Office Agency. HMRC can refer any probate valuation to them for checking. The District Valuer does not act for you. |
| Base cost | The figure capital gains tax is measured from. The probate value becomes the estate's base cost, so if the property later sells for more, the difference is a taxable gain. |
What is a probate valuation?
A probate valuation is the value of the property as at the date the owner died, prepared so it can be entered on the inheritance tax account and relied on by HMRC.
It is not the asking price. It is not what the family hopes to achieve. It is not the rebuild figure on the insurance policy, which is a different calculation altogether and usually much higher.
What HMRC actually requires
The legal test comes from section 160 of the Inheritance Tax Act 1984, which defines the value of property as:
"the price which the property might reasonably be expected to fetch if sold in the open market at that time; but that price shall not be assumed to be reduced on the ground that the whole property is to be placed on the market at one and the same time."
In plain terms: the price the property might reasonably have fetched on the open market on the date of death.
Not tidied up, not modernised, not marketed for six months to find the perfect buyer.
Two parts of that catch executors out. The date is fixed at the date of death, so a valuation carried out four months later has to look backwards to that day rather than describe today's market. And the condition is the condition on that date, which for a property lived in by an elderly person for decades is often well below what the street would otherwise achieve.
GOV.UK sets out who can give you that figure. It says you can "get any property or land valued by an estate agent or chartered surveyor", and that you can also "get a professional valuation for anything worth over £1,500".
Why the figure matters twice
It affects the inheritance tax position The property value goes into the estate total. Above the £325,000 nil-rate band, and any residence nil-rate band of up to £175,000 that applies, inheritance tax is charged at 40%.
It sets the capital gains tax later. The probate value becomes the estate's base cost. If the property sells for more than that figure, the difference is a gain, taxed at 24% for personal representatives.
So the same number pulls in two directions, and we come back to that trade-off further down.
If the property was jointly owned
How the property was held changes what you are valuing.
Where it was owned as joint tenants, the deceased's share passes automatically to the surviving owner. That does not take it out of the estate for tax. The share still has to be valued and reported on form IHT404, which covers jointly owned assets whether they pass by survivorship or under the will. Executors miss this more often than any other part of the exercise.
Where it was held as tenants in common, the share passes under the will or the intestacy rules, and the size of that share needs establishing before anyone can value it.
Either way you are valuing a share rather than a house, and a share is usually worth less than the arithmetic fraction of the whole, because someone buying half a house cannot do much with it. HMRC accepts this. Its manual acknowledges that joint ownership results in discounting the open market value and leaves the size of the discount to the District Valuer rather than fixing a figure. Treat any page quoting a flat 10% with caution, because the manual does not say that.
Do I need an official house valuation for probate?
Not always. It depends on the size of the estate and on whether inheritance tax is in play.
There are two things people mean by "official", and they are quite different in cost and in weight.
| Estate agent valuation letter | RICS Red Book valuation | |
|---|---|---|
| Cost | Usually free | Paid, quoted by the surveyor approximately in the sum of £300-£600. although fees vary by property, location and complexity. |
| Turnaround | Visit within a few days, letter shortly after | Inspection, then a written report (typically provided within 3-7 working days) |
| Who provides it | Local estate agent | RICS chartered surveyor |
| What you get | A figure on headed paper, ideally naming comparable sales | A formal report stating the basis of valuation and the comparable evidence |
| Accountability | A market opinion. The agent is not professionally accountable for it | Signed by a professional carrying indemnity insurance and accountable for the figure |
| When it is enough | Estate comfortably below the tax thresholds, no dispute, ordinary property | Inheritance tax payable or near the threshold, disputed estate, unusual property, beneficiary buying from the estate, jointly owned share |
Estate agent valuation letters
A local agent visits the property, gives you a figure and puts it in writing on headed paper. This is normally free, because the agent is hoping to be instructed on the sale.
It is a genuine market opinion from someone who sells houses on that street, and for many straightforward estates, it is usually sufficient . Ask specifically for a valuation as at the date of death rather than a marketing appraisal, and ask the agent to say in the letter which comparable sales they have relied on. A bare figure with no reasoning behind it is worth very little if HMRC asks a question. A valuation supported by clear reasoning will be easier to justify if HMRC raises a query.
RICS Red Book valuations
A chartered surveyor inspects the property and produces a formal written valuation prepared to the RICS Valuation Global Standards, known to everyone in the industry as the Red Book.
This is a paid, professional instruction. The surveyor carries professional indemnity insurance, states the basis of valuation, identifies the comparable evidence, and signs a report designed to be defended. When HMRC or the District Valuer looks at it, they are looking at work by a professional who is accountable for it.
When an estate agent letter is enough
Where the estate is comfortably under the tax thresholds and there is no dispute in the family, written agent valuations are usually accepted without difficulty. No inheritance tax is payable, so there is nothing for HMRC to challenge on the property, and the practical risk is low.
"Comfortably" is doing real work in that sentence. If the property value is what decides whether the estate crosses the threshold, it is not comfortable, and you are relying on a free letter to determine whether a 40% tax charge applies.
When a Red Book valuation is the safer route
We would normally advise a Red Book valuation where:
• Inheritance tax is payable, or the estate is close to the threshold. The figure is now doing tax work and needs to withstand scrutiny.
• The estate is disputed, or likely to be. A professional valuation is far harder for a disappointed beneficiary to argue with than a letter from an agent who wants the instruction.
• The property is unusual. Listed buildings, agricultural land, development potential, unregistered land, short leases, shared ownership, poor structural condition, or anything with no clean comparable sales nearby.
• A beneficiary is buying the property from the estate. Where an executor sells to a family member the price must be demonstrably proper, and this is one of the most common ways executors expose themselves personally.
• Someone else owns a share of the property. Valuing an undivided share is a specialist exercise, as set out above.
What to tell the valuer
Whoever you instruct can only value what they know about, and three things get left out of the conversation more often than anything else. All three move the figure.
• Development potential. A large garden, a plot with planning history, or land that could take another dwelling.
• Tenancies.. An existing tenancy may affect the property's open market value.
• Anyone living there. Occupation by someone other than the person who died affects the value and needs raising at the outset, not after the report arrives.
How many valuations do you need for probate?
There is no legal requirement to obtain three valuations, and no requirement to obtain any particular number. GOV.UK refers to getting the property "valued by an estate agent or chartered surveyor", in the singular. The obligation is to arrive at an accurate open market value and to keep a record of how you worked it out.
So where does the three-agent convention come from? From practicality rather than law. Estate agent appraisals are free, three of them cost nothing but time, and an executor holding three consistent opinions is in a much stronger position than one who took a single figure on trust. It became normal practice because it is cheap evidence, not because a rule requires it.
Averaging, and why it can mislead
Taking the average of three agent figures is common, and it is also where the reasoning usually stops.
Averaging £480,000, £490,000 and £495,000 is sensible, because the agents agree and the answer sits in a narrow band. Averaging £420,000, £500,000 and £575,000 tells you almost nothing. Those agents disagree by more than £150,000, and the average conceals the disagreement rather than resolving it. That spread is a signal the property is hard to value, which is precisely when a Red Book valuation earns its fee.
What matters to HMRC is not the arithmetic but whether the figure is defensible. A defensible valuation is one you can explain: this is the property, these are the comparable sales, this is the condition it was in, this is the figure and this is why. A convenient valuation is one chosen for what it does to the tax bill. When the two diverge, it is the defensible figure that goes on the form.
Worth knowing about free appraisals: an agent hoping to win the instruction has an incentive to be optimistic, which pushes the probate value up. That raises inheritance tax on a taxable estate while reducing capital gains tax later. Not automatically wrong, but worth understanding which way the pressure runs.
Probate value versus market value
These two figures are often close and sometimes a long way apart, and the difference is not a mistake.
Probate value is pinned to one day and one condition: the value on the date of death, with the property as it actually stood, assuming a reasonable sale in the open market rather than any particular buyer. Market value is today's figure, usually after the family has cleared the house and put right whatever needed doing, and it reflects one real buyer on one real day. Months of delay in a moving market account for the rest.
What happens when the property later sells well above the probate value
A higher sale price is not evidence that you did anything wrong, and it does not automatically reopen the inheritance tax position. What it does do is create a gain for capital gains tax: the difference between the probate value and the sale proceeds, less selling costs.
Estates have their own annual exempt amount, currently £3,000, available for the tax year of death and the following two tax years, so a modest gain often produces no tax at all. Where a gain does arise, the estate must report and pay the capital gains tax within 60 days of completion.
Where the gap is very large and the sale happens soon after death, HMRC may take the view that the probate value was simply too low, and it can revisit the inheritance tax account. There is also a step most executors do not realise is open to them. If a professional valuation and the eventual sale price differ sharply, and nothing about the property or the market explains the gap, you can go back to the valuer and ask them to reconsider the date of death figure. A valuer who accepts the point can revise the report, which is a good deal simpler than defending the original number to HMRC later.
Valuing the contents
The house is only part of it. The contents form part of the estate too, and they have to be valued on the same open market basis.
Chattels and where the line falls
Personal possessions, or chattels, cover furniture, electrical goods, jewellery, cars, antiques, artwork, collections and everything else in the house.
GOV.UK draws a practical line. You can "estimate the value of cheaper assets, such as electrical items and ordinary household goods", and for "things like cars, jewellery, and paintings, work out how much you would have got if you'd sold them". Above £1,500 for a single item, a professional valuation is recommended.
That gives you a workable rule. Ordinary contents can be estimated as a block. Anything individually significant gets valued properly and listed separately.
When a specialist valuer is needed
Bring in a specialist where the estate includes jewellery, watches, artwork, antiques, a classic car, a collection of any kind, or anything you genuinely cannot price. Auction houses will often provide a probate valuation for these, and the cost is modest against the risk of guessing.
Jewellery is the one that catches people out most often, partly because it is the item families most want to keep and partly because the insurance figure is so much higher than the open market one. An insurance valuation is a replacement cost, which is what it would take to buy the piece new from a retailer. The probate figure is what it would have fetched second hand on the date of death, which for most jewellery is a good deal less. Use a jeweller or auction house that will put a probate valuation in writing, and say what it is for when you ask.
The same applies if the contents are likely to be argued over. A neutral valuation of the items family members want is far easier than a negotiation with no figures in it.
The overvaluation trap
This is the most common contents mistake we see, and it costs estates money for no reason. Executors reach for the wrong basis, using what the items cost new or the sum insured on the contents policy, and arrive at £20,000 or £30,000 for a normally furnished house. The correct basis is what the goods would have fetched second hand on the open market on the date of death, as they were.
The honest answer for ordinary furniture, carpets, white goods and televisions is very little. House clearance firms frequently charge to remove such items rather than pay for them. There is no official average value of house contents for probate, and HMRC publishes no such figure, so treat any number presented as a benchmark with caution.
Where the estate is taxable, an inflated contents figure is taxed at 40% like everything else. That is real money paid on a sofa nobody would buy.
Getting the valuation wrong
The risk runs in both directions, and the consequences are different.
Undervaluing the property
If HMRC concludes the value was too low, the additional tax becomes payable with interest, which runs from the date the tax should have been paid rather than the date the error comes to light. Late paid inheritance tax is currently charged at 7.75%.
HMRC can also charge a penalty based on the behaviour behind the inaccuracy. The maximum penalties are 30% of the extra tax for a careless inaccuracy, 70% where it was deliberate, and 100% where it was deliberate and concealed. Executors are personally responsible for the accuracy of the account they sign, and a figure taken casually because it seemed roughly right is exactly what "careless" describes. Executors should therefore take reasonable care to obtain and retain evidence supporting the value reported.
If HMRC refers your valuation to the District Valuer
The District Valuer is part of the Valuation Office Agency, an executive agency of HMRC, and does not work for you. HMRC decides which valuations to refer, and high-value estates, unusual properties, figures with no supporting evidence, and values that sit oddly against local sale prices all attract attention. The VOA considers informally whether your figure is fair and reasonable against the data it already holds, and if it disagrees the District Valuer will contact you or your solicitor to try to agree one. Most cases settle by agreement. It is not a disaster, but it takes months and holds up the estate, which is the practical reason to hold a properly evidenced valuation rather than a one-line letter.
Overvaluing the property
There is no penalty for overvaluing. You simply pay inheritance tax at 40% on value that did not exist, and the estate is worse off by that amount. Where the property is later sold at a loss within four years of the death, relief for loss on sale of land can be claimed on form IHT38, but only where inheritance tax was actually paid on the estate, and conditions apply.
The inheritance tax and capital gains tax trade-off
A lower value may reduce inheritance tax but increase a later capital gain, while a higher value may have the opposite effect.
You cannot minimise both, and the right answer depends on whether inheritance tax is actually payable.
• If no inheritance tax is due, arguing the value down achieves nothing and buys a capital gains bill on the sale.
• If inheritance tax is payable, every £1,000 of value costs £400 in inheritance tax now and would only have cost £240 in capital gains tax later.
This is a reason to think carefully about a genuine valuation, not a licence to pick a number. The figure has to be the open market value either way. What you can properly do is make sure it reflects the true condition of the property, and settle that at the valuation stage rather than after the house has sold.
How much does a probate valuation cost and how long does it take?
Are probate valuations free?
Estate agent valuations usually are. The agent is hoping to be instructed on the sale, so the visit and the letter normally cost nothing, and most will attend within a few days. Allow a week or two to gather two or three of them.
Some agents do charge, particularly where they can see the property will not be sold through them, for example because it is being transferred to a beneficiary or sold at auction. Ask when you book the visit rather than assuming, and ask for the letter to give the value as at the date of death.
What a RICS Red Book valuation costs
This one is always paid for. The surveyor prices it according to the value, type and location of the property, so ask for a fee quote before you instruct rather than working from a figure you have seen quoted online. Expect an inspection of the property followed by a written report, rather than a figure on the day. Indicative fees and turnaround are in the comparison table above.
The fee is an expense of the estate rather than something the executor pays personally, so it comes out of estate funds before the beneficiaries are paid.
What contents valuations cost
Auction houses and specialist valuers often provide a probate valuation free or at low cost where they expect to handle the sale of the items, and charge where they do not. For jewellery and smaller items, a written valuation is usually inexpensive set against the risk of guessing.
How much the valuation delays the estate
In practice, very little. The property figure is normally settled long before the inheritance tax account is finalised and the probate application is submitted, so the valuation is rarely the thing holding matters up.
Where delay does arise it comes later, from a District Valuer referral, and that can add months. Which is the real argument for spending money on a defensible valuation at the start.
Our page on how much probate costs sets out the wider picture on fees, and our own published fees are on the fees page.
If you’re unsure what to do next
Getting a value for the house is one of those jobs that looks small and turns out to matter a great deal. If you are unsure whether an agent's letter will do, whether the estate is close enough to the threshold to need a surveyor, or how to handle a valuation HMRC has queried, we are happy to talk it through.
Ash Hill Solicitors is a private client law firm in North Harrow, north-west London, authorised and regulated by the Solicitors Regulation Authority under number 818037, which means we are permitted to carry out reserved probate work. We offer a free, no obligation 20-minute chat, and our probate fees are published on our fees page so you know the cost before you commit. If you cannot travel to us, we visit clients at home, in hospital and in hospices.
Call us on 0208 515 2790, or get in touch and we will come back to you.
If the property is also being sold or transferred, our guide to property during probate covers what executors can and cannot do before the grant, and the inheritance tax page covers the thresholds in more detail.
Frequently asked questions
Do I need an official house valuation for probate?
Not always. Where the estate is comfortably below the inheritance tax thresholds and there is no dispute, written valuations from estate agents are normally accepted. A formal RICS Red Book valuation is the safer route where inheritance tax is payable, where the estate is disputed, or where the property is unusual.
How many valuations do you need for probate?
There is no legal requirement for a set number, and GOV.UK does not specify one. Three estate agent valuations is a common convention rather than a rule. What matters is that the figure is accurate and that you can show how you arrived at it.
Who can value a house for probate?
An estate agent or a chartered surveyor. GOV.UK confirms both are acceptable. HMRC may separately refer the valuation to the District Valuer at the Valuation Office Agency for checking.
Do estate agents charge for probate valuations?
Usually not. Most treat the visit as a chance to win the sale instruction, so the valuation and the letter are free. Some do charge where the property is clearly not going to be sold through them, so ask when you book the appointment.
Is the probate value the same as the market value?
Not usually. Probate value is the open market value on the date of death, in the condition the property was in on that date. Market value is what the property would fetch today, often after clearance and repair, and in a different market.
Can you sell a house for more than the probate value?
Yes, and it happens often. The difference is treated as a gain for capital gains tax, subject to the estate's annual exempt amount. Where the sale is soon after death and the gap is large, HMRC may question whether the probate value was too low.
What is the average value of house contents for probate?
There is no official average and HMRC does not publish one. Ordinary household furniture and electrical goods are worth very little second hand, so the correct figure is usually far lower than executors expect. Individual items worth more than £1,500 should be valued professionally.
What happens if you undervalue a property for probate?
HMRC can charge the additional tax with interest, currently 7.75%, and a penalty of up to 30% of the extra tax for carelessness, rising to 100% where the inaccuracy was deliberate and concealed.
Does the house need to be valued before or after probate is granted?
Before. The valuation is needed to complete the inheritance tax account, which comes before the probate application. The value is always taken as at the date of death, whenever the valuation is actually carried out.
How long is a probate valuation valid for?
It has no expiry date. It records the value at one fixed point, the date of death, and that date never changes. If the estate takes years to administer, the probate value stays the same, though the property's current market value will have moved.
Author Bio:
Nasreen Akhter is the founding director of Ash Hill Solicitors and a private client solicitor with over a decade of experience in probate, wills, estate planning and elderly client care. Known for her calm, compassionate approach, she guides individuals and families through life's most sensitive legal matters with clarity and care.
Nasreen is also an accredited civil and commercial mediator, and is listed on the Solicitors Regulation Authority (SRA) register. Outside of work, she's a dedicated mum and chairs Happy Orphans Worldwide, a charity supporting vulnerable children worldwide.
