How to value and distribute a property in cases of inheritance, divorce, or common ownership division
Almost every conflict I see regarding a shared property has the same root: no one has set the value methodically, and each party argues from their own interest. The person who wants to keep the house values it low; the person who is leaving, values it high. Without a technical figure, the conversation does not progress.
The three scenarios
Scenario 1 · Inheritance
Several heirs, one or more properties. They must be valued to calculate the hereditary estate, settle Inheritance Tax, and divide assets. Conflict arises when one party wants to keep the house and others want money, or when one person is living in it.
Scenario 2 · Divorce and settlement of matrimonial assets
The family home is usually the main asset. It must be valued to allocate it to one spouse with compensation to the other, or to sell it and distribute the proceeds. It becomes complicated when there is an active mortgage and when one of the two contributed private funds.
Scenario 3 · Co-ownership without agreement
Hers who inherited years ago, business partners, or unmarried ex-partners. One wants to exit, the others do not buy or do not accept the price. The Civil Code establishes that no co-owner is obliged to remain in the community and can request the division of common ownership at any time.
What value is used in each case and at what date
This is the part that generates the most errors. Not all values are suitable for everything, and the date matters as much as the figure.
| Situation | Applicable Value | Reference Date |
|---|---|---|
| Inheritance Tax | Cadastral reference value as a minimum base; if it does not exist, market value | Date of death |
| Distribution between heirs | Market value | Usually the date of distribution, unless agreed otherwise |
| Settlement of matrimonial assets | Market value | Date of settlement, not the date of separation |
| Extinction of condominium | Market value | Date of agreement or public deed |
| Judicial division of common ownership | Expert market value | The one set by the court |
| Sale to a third party | Freely agreed price | — |
Common practical consequence: in an inheritance, the value declared to the tax authorities at the time of death and the value used for distribution three years later do not have to coincide, and they usually do not. Confusing them leads to unbalanced distributions and, sometimes, subsequent tax problems during a future sale.
Market value, reference value, and declared value
| Market Value | Reference Value | Declared Value | |
|---|---|---|---|
| Who sets it | The market, certified by a technician | General Directorate of Cadastre | The parties in the deed |
| What it is for | Distributing, negotiating, selling | Minimum taxable base in ITP, AJD and Inheritance | Documenting the operation |
| Reflects the specific property | Yes | No: calculated by areas and models | Depends |
| Can be challenged | Yes, with a counter-report | Yes, via challenge with evidence | — |
The classic error: using the reference value to distribute among heirs. The reference value is a fiscal magnitude calculated massively by areas; it does not know the state of your house, nor its orientation, nor if it has a lift. It can be far above or far below the real value. Distributing with it generates real inequalities among heirs.
When a co-owner blocks: the division of common ownership
It is the most repeated question: "What if one of the three siblings does not want to sell?"
The Civil Code is based on a clear principle: no one is forced to remain in a community of property. Any co-owner can request at any time that the common ownership be divided.
The problem is that a home is usually indivisible: it cannot be split into three. For these cases, the legal system provides that it be awarded to one party by compensating the others or, if there is no agreement, that it be sold and the price distributed.
In practice, the path is as follows:
- Negotiation with a technical valuation on the table. It is the cheapest way and the one that resolves most cases.
- Formal requirement to the other co-owners, usually via a notary, offering the purchase or sale at the expert value.
- Lawsuit for division of common ownership, if the above fails.
- Award to one with compensation or sale, depending on what the proceedings determine.
What you have to understand: the co-owner who blocks does not have an indefinite right of veto. What they have is the ability to make the process more expensive and longer. And that ability is greatly reduced when the other party arrives with a serious expert report.
Extinction of condominium: how compensation is calculated
It is the most common exit when one of the co-owners keeps the property.
Calculation of compensation:
Compensation = (Market value − Outstanding mortgage debt) × % ownership of the person leaving
Example. Property valued at €320,000, outstanding mortgage of €80,000, two co-owners at 50%:
- Net value: 320,000 − 80,000 = €240,000
- Compensation to the one leaving: 240,000 × 50% = €120,000
Whoever keeps the property also assumes the entire mortgage debt, which requires the bank's consent (novation or subrogation). It is a step that is frequently forgotten and can block the entire operation.
Taxation — important note: the extinction of condominium on an indivisible asset, when awarded to one co-owner while compensating the rest in cash, has been treated by the Supreme Court doctrine as an act subject to Documented Legal Acts (AJD) and not to Onerous Property Transfers (ITP), which implies a very relevant tax difference in Andalucía (1.2% versus 7%). It must be verified with tax advice before signing the deed. An error at this point can multiply the bill by six.
Frequent errors that end up in court
1. Distributing with the cadastral reference value. As already explained: it is a fiscal magnitude, not a real value.
2. Valuing at the wrong date. In the settlement of matrimonial assets, using the value on the day of separation instead of the day of settlement. In markets that rise by 7% per year, a three-year difference is 22%.
3. Forgetting the mortgage. Compensating on the gross value instead of the net value. It is an error of tens of thousands of euros.
4. Not counting on the bank. Agreeing on who keeps the house without having verified if the bank accepts releasing the other from the debt. The agreement falls apart at the last minute.
5. Accepting the opposing party's valuation "to avoid arguing". It is understandable due to emotional exhaustion and usually costs a lot of money.
6. Ignoring who has been paying for what. Mortgage payments, IBI (property tax), community fees, and repairs paid for by only one generate credits between co-owners that must be calculated in the distribution.
7. Not documenting the state of the property. If one of the co-owners lives in the house and it deteriorates, without dated photographs there is no way to prove it later.
What to ask your expert for the report to hold up
If you are going to commission a report that may end up being discussed, demand:
- Value at an express date, literally indicated in the conclusions.
- Identified comparables and documented homogenization method.
- Visit and inspection with a dated photographic report.
- Verification of surface areas against the Land Registry and Cadastre, with mention of discrepancies.
- Status of charges according to an updated simple note (nota simple).
- Declaration of objectivity in accordance with procedural regulations.
- Availability to ratify the report in court.
A report without an express valuation date is, in proceedings, a half-baked report.
Frequently asked questions
What happens if an heir does not want to sell?
They cannot block it indefinitely. The Civil Code allows any co-owner to request the division of common ownership at any time. If the property is indivisible, it is awarded to one party while compensating the others, or it is sold and the price is distributed.
Is it valued on the day of death or today?
It depends on the purpose. For Inheritance Tax, on the date of death. For distribution between heirs, usually at the current value at the time of distribution, unless they have agreed otherwise. These are two different figures and it is advisable not to mix them.
Is the Cadastre reference value valid for distribution?
It is not recommended. The reference value is a fiscal magnitude calculated massively by zones, which does not incorporate the real state, orientation, views, or the particularities of the specific property.
What is the extinction of condominium and how is it taxed?
It is the operation by which a co-ownership is dissolved by awarding the asset to one of the co-owners, who financially compensates the rest. When the asset is indivisible and the compensation is in cash, the Supreme Court doctrine has been treating it as subject to AJD and not ITP, which in Andalucía means a notable difference. The specific qualification must be verified with tax advice before signing the deed.
How much does an expert report cost for an inheritance?
In the province of Málaga, between 450 and 900 euros for a standard home. Compared to the cost of a judicial procedure for division of common ownership, it is the most profitable investment of the entire process: in most cases, it avoids the lawsuit.
I have been without an agreement with my siblings for years, where do I start?
With the valuation. As long as there is no technical figure on the table, each party negotiates from their perception and the conversation does not advance. With an expert report in front of you, the discussion goes from "how much do you think it is worth" to "how do we distribute this".
Do you need a valuation to distribute?
I prepare valuation reports at a specific date for inheritances, settlements of matrimonial assets, and extinctions of condominium, with the structure and requirements demanded by expert evidence. Málaga capital and the entire Axarquía region.
Notice: this article offers general information of a technical and informative nature. It does not constitute legal or tax advice on a specific case. The taxation of these operations depends on the particular circumstances and the regulations in force at the time of the operation; consult your lawyer and your tax advisor before signing the deed.
Fabiana Gastaudo is a judicial real estate expert and expert in property valuation, practicing in Málaga and the Axarquía region.
Sources: Civil Code, articles 392 and following (community of property) and 1,061 and following (partition of inheritance) · Supreme Court doctrine regarding the taxation of the extinction of condominium on indivisible assets · ITP and AJD rates in force in Andalucía, 2026.
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