What is the Difference Between Probate Value and Market Value?

When someone passes away and leaves property as part of their estate, the value of that property becomes an important legal and financial consideration. Two figures are commonly referred to during this process: probate value and market value.

In simple terms, the probate value is the value of a property at the date of death, while the market value is the price the property could realistically achieve if sold on the open market, usually at a later date.

Although these values are related, they are not always the same and understanding the difference can help executors, beneficiaries and families avoid confusion, tax issues, and unexpected liabilities.

At Lyons Solicitors, our probate specialists regularly advise on probate valuation and estate administration, helping clients ensure valuations are accurate, compliant, and clearly documented. This guide answers some of the most common questions surrounding probate value vs market value.

Please note that this blog is for informational purposes only and does not constitute legal advice.

If you require support today, please contact our Wills & probate solicitors.

What is probate value?

The probate value is the value of a property on the date of the deceased’s death. This figure is used when applying for probate and forms part of the overall estate valuation.

A probate valuation should reflect what the property would reasonably have sold for on the open market at that time, assuming a willing buyer and seller. It must be realistic and justifiable, as it is used to calculate whether Inheritance Tax (IHT) is payable.

The probate value is submitted to HM Revenue & Customs (HMRC) as part of the probate application and must be supported by evidence, such as professional valuations or estate agent appraisals.

What is market value?

Market value is the price a property is expected to achieve when sold on the open market. This may be weeks or months after probate is granted and can be influenced by factors such as:

• Changes in the property market
• Demand in the local area
• Property condition or improvements
• Sale method and timescale

Market value is most relevant when selling a home, whether as part of estate administration or a standard property transaction. If the sale takes place some time after the date of death, the market value may be higher or lower than the original probate value.

Why are these probate and market values often different?

Probate value and market value are often different because they are assessed at different points in time and under different circumstances.

Property prices can change due to market conditions, interest rates, or local demand. In addition, a property may be renovated, repaired, or staged for sale after the probate valuation has been completed, increasing its appeal and sale price.

Conversely, delays, a slow market, or unforeseen issues may result in a lower sale price than initially expected. These fluctuations are common and do not necessarily indicate that the probate valuation was incorrect.

Do I pay tax on the probate value?

Yes, Inheritance Tax is calculated using the probate value of the estate, not the eventual sale price of the property.

If the total estate value exceeds the available IHT threshold, tax may be payable before probate can be granted. This is why an accurate probate valuation is essential.

For tailored guidance, our solicitors can advise on probate and Inheritance Tax advice, including reliefs, exemptions, and valuation requirements, please get in touch.

What happens if I sell a house for more than the probate value?

If a property sells for more than the probate value, Capital Gains Tax (CGT) may be payable on the difference between the probate value and the sale price.

This gain is calculated from the date of death to the date of sale. However, allowances and reliefs may apply, and not all estates will be liable for CGT.

Accurate records of the probate valuation and sale price are essential to ensure the correct tax position is reported.

What if the house sells for less than the probate value?

If the property sells for less than the probate value, it may be possible to reclaim some Inheritance Tax that was previously paid.

HMRC allows estates to apply for IHT relief on property sold at a loss, provided certain criteria are met and claims are made within the required time limits.

This is one reason why keeping clear valuation evidence and sale documentation is important throughout the probate process.

If you require advice on selling a home, please don’t hesitate to get in touch with our expert solicitors.

Who decides the probate value?

The responsibility for declaring the probate value rests with the executors or administrators of the estate.

While estate agents’ appraisals are commonly used, HMRC may challenge a valuation if it appears unrealistic. For higher-value or more complex estates, a professional RICS valuation may be appropriate.

Your solicitor can advise on whether a formal valuation is recommended and help ensure the estate valuation is properly supported and defensible.

How long is a probate valuation valid?

A probate valuation reflects the property’s value at the date of death only. There is no formal expiry date, but it should not be reused for other purposes, such as marketing the property months later.

If a significant amount of time has passed or the property market has shifted, an updated market appraisal will usually be needed before the sale.

Speak to our probate solicitors in Bristol

Dealing with probate can feel overwhelming, particularly when property and tax issues are involved. Our experienced probate solicitors provide clear, practical advice at every stage of estate administration.

We can assist with probate applications, estate valuation, and property matters, including coordinating with our conveyancing team when selling a home as part of an estate.

Contact us in Chew Magna, Kingswood or Westbury-on-Trym and the wider Bristol area, please get in touch today. You can use the contact details for each office or, alternatively, fill in the enquiry form on the right-hand side of the page to request a call back.