What Does a Probate Referee Do When a House Is in Probate?

When someone passes away and their home goes through probate, the court needs an independent value for it. That's the probate referee's job. The California State Controller's Office appoints probate referees to provide prompt, low-cost appraisals of estate assets, and it appoints at least one referee for each county.

I'm Jeanette Nelson, a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas. When a family is settling a parent's estate, I want them to understand each step of the process, because knowing what comes next makes a hard season a little easier.

This article is general information, not legal or tax advice. Please work with a probate attorney and a CPA on your family's estate.

The California Courts self-help site explains that the personal representative, usually the executor or administrator, gathers the assets and prepares an Inventory and Appraisal, form DE-160. The representative will usually need a probate referee to value the non-cash assets.

The State Controller's guidance explains it this way:

• Cash-type items, like bank accounts, are listed and valued by the personal representative.
• Everything else, including real estate, is appraised by the probate referee.

The Controller's guide also says the house must be appraised by a referee from the county where the real property is located. For a home in Huntington Beach, Costa Mesa or Fountain Valley, that means an Orange County referee.

The Controller's Standards say a referee must complete the appraisal, report on it, or return it not later than 60 days after the inventory is delivered. Your attorney will tell you when the completed Inventory and Appraisal is due to the court.

You can help by giving the referee accurate details about the home, such as its condition and any needed repairs, through your attorney.

The fee is set by law, not negotiated, in a probate case.

• The commission. California Probate Code Section 8961 sets it at one-tenth of one percent of the value of the property the referee appraises, plus actual and necessary expenses.
• The limits. Probate Code Section 8963 sets a minimum of $75 and a maximum of $10,000, and the court can approve more in certain cases.

For example, on a house valued at $1,500,000, one-tenth of one percent is $1,500, plus expenses.

The Controller's Office also notes that probate referees often appraise assets for trusts where no court case is involved, and in those matters the fee is negotiable.

It matters in two ways.

The court's price rule. If the sale needs court confirmation, Probate Code Section 10309 says the price must be at least 90% of the appraised value, using an appraisal made within one year before the hearing. My article on court confirmation in a California probate sale explains that hearing.

The tax picture for heirs. IRS Publication 551 explains that the tax basis of inherited property is generally its fair market value on the date of death. A careful date-of-death value can matter later when the house is sold. Your CPA can explain how it applies to your family.

The referee's value isn't a listing price. When it's time to sell, pricing comes from the current market and recent sales of similar homes.

1. Work with a probate attorney on the filings and deadlines.
2. Gather the home's details, such as known repairs, upgrades and condition.
3. Talk early about the house. Will it be sold, kept, or bought by one family member? My article on whether you need probate to sell an inherited house covers the bigger picture, and my probate sales page has more on the process.

If your family is settling an estate and the house is part of it, I'd be glad to walk you through the options alongside your probate attorney. Let's start with a private planning conversation about your family's goals and timeline. Call or text me at 714.366.8575 | DRE: 01397168, or contact me. Jeanette Nelson is a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas.