Starting April 1, 2025, You May Not Need Probate in California (See If You Qualify)
As of April 1, 2025, California’s probate threshold for primary residences is $750,000. This means that estates with primary residences valued under $750,000 can use a simplified probate process.
The new law, Assembly Bill 2016 (AB 2016), is offering new opportunities and challenges for real estate agents working with homeowners and beneficiaries. This adjustment aims to simplify the probate process for smaller estates, but it also underscores the importance of proactive estate planning.
What Is Changing?
Currently, estates valued at $184,500 or more must go through probate in California. The new threshold will increase significantly, allowing estates valued up to $750,000 to bypass the formal probate process. For real estate agents, this shift means that more property transactions might avoid the lengthy and often costly probate court proceedings.
Impact on Real Estate Business
- Faster Sales for Smaller Estates: With the increased threshold, heirs and beneficiaries can transfer real estate assets more quickly without waiting for probate clearance. This change will likely lead to faster sales and reduced holding costs for properties under the new limit.
- Increased Market Activity: The streamlined process might encourage more families to sell inherited properties, leading to increased listing opportunities for real estate professionals.
- Targeted Marketing Opportunities: Real estate agents can tailor their marketing strategies to connect with families managing estates under $750,000, highlighting the benefits of a simplified sales process.
Why a Living Trust Still Matters
While the increased probate threshold is good news for smaller estates, creating a living trust remains the gold standard for estate planning. A living trust allows homeowners to avoid probate entirely, regardless of the estate’s value. Unlike the increased threshold, a trust ensures privacy, minimizes legal fees, and provides more control over asset distribution.
For real estate agents, educating clients on the benefits of living trusts can build trust and lead to stronger client relationships. By collaborating with probate attorneys, agents can provide added value to homeowners looking to secure their legacy and streamline future transactions.
Final Thoughts
As California’s probate laws evolve, real estate professionals have a unique opportunity to support clients through the transition. Staying informed and offering guidance on estate planning options will not only boost business prospects but also provide a valuable service to families navigating the complexities of inheritance and probate.
For more information on the upcoming changes and how they might affect your business, feel free to reach out to our office. We’re here to help you and your clients navigate the probate process with confidence.