Inheriting a property with your siblings sounds straightforward, but it rarely is.
Even when there’s a Will setting out who gets what, that’s often just the starting point. Siblings don’t always agree on what should happen next — whether to sell, keep, rent, or buy each other out. These decisions can stir up old tensions and quickly lead to disputes. Add in tax issues, legal duties and financial strain, and things can escalate.
This guide outlines the key steps to take when inheriting property with siblings in Australia, to help you stay on track and avoid unnecessary conflict. It goes without saying that before anything is agreed in writing, each person should seek their own legal advice to ensure what has been agreed is workable.
Step #1: Understand what you’ve inherited
The first step is getting clear on what exactly has been left to you. If there’s a valid Will, it should name the beneficiaries and the share each person is entitled to. If there’s no Will, or parts of the estate aren’t covered in the Will, the rules of intestacy apply. This can lead to very different outcomes depending on your family structure and which state or territory you’re in.
We’ve covered what happens in Western Australia in more detail in our guide: What Happens If You Die Without a Will in Australia?
You’ll also need to check who the executor is. That person is responsible for managing the estate, which includes organising the transfer of property. If the estate includes debt, or if the property is jointly owned, those factors can affect what you’ve actually inherited (and what you can legally do with it).
Step #2: Get the property valued
Once you know what’s been left to you, arrange a formal valuation of the property by a licensed valuer. This gives everyone a clear picture of what the asset is worth and helps avoid disputes down the track.
A proper valuation is especially important if one sibling wants to buy out the others, or if you’re considering selling. It also sets the basis for working out taxes and stamp duty obligations.
Don’t rely on informal estimates or real estate appraisals. Use a qualified, independent valuer who can provide a written report. It keeps the process objective and makes sure everyone is working off the same number.
Step #3: Talk first (and then put it in writing)
Before anyone makes a move, have a proper conversation. It sounds simple, but many families skip this step and end up in conflict. Get everyone together and be clear about what each person wants. Some may want to sell, others may want to hold on to the property or live in it. You won’t know until you ask.
Once you’ve had that conversation, don’t leave things to memory. Put the agreement in writing, even if it’s informal to start with. If you agree to sell, spell out who will manage it and how costs will be handled. If someone plans to buy out the others, document the terms.
Early communication and a written record help avoid confusion and preserve relationships.
Step #4: Weigh up your options
Once everyone’s had their say and you know the property’s value, it’s time to decide what to do with it. This will depend on your family dynamic, financial position, and long-term goals.
Here are the main paths families consider.
Sell the property
Divide the proceeds according to each person’s share. This is often the simplest option, especially when no one wants to keep the property or if agreement can’t be reached. Be mindful of capital gains tax and selling costs.
One sibling buys out the others
This allows one person to keep the home while the others get their share in cash. A formal valuation is essential, and stamp duty may apply. Finance approval and legal transfer will be needed.
Keep it and rent it out together
You can turn the property into an investment and share the rental income. This requires a clear agreement on how costs, rent and management duties are handled. It is essential that if you choose this option, a co-ownership agreement is put in place to avoid any disputes regarding the use and management of property in the future.
Private arrangements
Sometimes families agree on something less formal, like letting one sibling live in the property and pay below-market rent to the others. These setups should still be documented and reviewed regularly.
Step #5: Address the tax and pension implications
Inheriting property can trigger tax and Centrelink consequences, especially if you’re planning to sell or hold the property for income.
Capital gains tax (CGT)
The estate may have to pay CGT when the property is sold, but there are some key exemptions.
- For example, if the property was the deceased’s main residence and it’s sold within two years of their death, CGT may not apply.
- Another common exemption is where the deceased acquired the property before 20 September 1985, which can remove the CGT obligation entirely in some cases.
Even if you don’t qualify for a full exemption, you might be partially exempt depending on how the property was used after death and who lived in it. If the property is kept for several years, used as an investment, or rented out, paying capital gains tax later may be unavoidable.
Stamp duty
If one sibling buys out the others, stamp duty may be payable on the transfer. There are some concessions, but you’ll need to check the rules in your state or territory.
Centrelink and pensions
Inheriting a property can affect your pension entitlements. You must tell Centrelink within 14 days of receiving a significant inheritance. The value of the property, even if unsold, can affect means-tested payments.
Step #6: Resolve disputes the smart way
Even with the best intentions, things can go off track. Old family dynamics, financial pressure, and misunderstandings often come to the surface when a valuable asset is involved.
If tensions arise, take steps early to stop them from escalating.
- Have structured discussions
Set a time to talk through the issues calmly. Avoid side conversations or assumptions.
- Use a mediator
If talks stall, consider bringing in a neutral third party. Mediation is faster and far less costly than legal action. - Get legal advice
An estate planning lawyer can explain your options, especially if someone isn’t cooperating or if the Will is being challenged.
- Document any agreement
Verbal deals can fall apart quickly. Make sure everything is put in writing and signed off, even if it’s informal. In Western Australia, any agreements in relation to real estate must be in writing.
- Keep the focus on resolution
You don’t have to agree on everything, just on a fair path forward.
Step #7: Plan for the future together
Once the immediate decisions are made, it’s worth thinking about what comes next. Inherited property can be a turning point, not just a one-off event.
If you decide to keep the property, make sure there’s an agreement in place for who manages it, how costs are shared, and what happens if someone wants to sell later. This avoids confusion down the line.
It’s also a good time to revisit your own estate plans. If the property becomes part of your assets, your Will and legal arrangements may need updating.
Avoiding the common pitfalls
Inheriting property with siblings can be complicated, even when everyone starts with the best of intentions. The key is to stay informed, communicate early, and get the right support when it matters.
At Solomon Hollett Lawyers, we help families navigate inheritance and property issues with clarity and care. If you need guidance on your next move, or want to make sure your own estate is in order, speak with our team of estate planning lawyers in Perth. We’re here to help you get it right.
