Parents purchased properties 30-50 years ago when they came to Ontario. These properties are now in the hands of the elderly or their children. Strange things happen in family dynamics when the potential to sell comes calling. Last year I worked with a family to sell their property but we could never get to a point of agreement. There was too many agendas and no trust between parties. I have become wary of discussing a sale unless all the members who have an interest are on board. This can be quite difficult. In one instance a family member wished to develop the property while others wished to sell. Discussions went from this is a viable project to it is dead in the water. In another there is now too many parties involved – who makes the decision? There is nothing like money to split a family, ask any Family Lawyer or Trustee of an Estate.
Some keys to consider:
- Selling a property so that all members proportionately benefit from the sale. One member should not have a hidden agenda to benefit. Transparency is not easy.
- If the one part of the family agrees to sell to the other then they need fair market value. this may be easy with a home but with land or commercial property there needs to be a point of reference. The only sure way of getting fair market value is to put the property on the market.
- Avoid lawyers until you have a general agreement. Lawyers skill is to interpret the law, write contracts etc. Without clear instructions they may suck ten of thousands of dollars from the asset sale. Come to a mutual agreement and have the lawyers write it up.
- Have agreement on triggering the sale transaction. Be clear on what you will agree to and if possible have mechanism to come to a decision.
- Have a professional facilitate discussion who will help you find common ground. Trust is key to success and a third party can make that happen
In my profession experience defining objectives, building trust and then working to ensure a win for the parties is critical to a successful sale.