Compare keeping it (a likely Prop 19 reassessment, management work, shared ownership) with selling it (a stepped-up basis that can cut the tax, cash for each heir, and ULA inside the City of LA). A written valuation is the starting point.
By David Saghian · $300M+ personally closed · $400M+ team
Four Questions to Answer First
1. What is it worth?
A written value from closed comps and the rent roll.
2. New tax bill?
Prop 19 usually means reassessment for rentals.
3. Who manages it?
Tenants, repairs and RSO rules do not pause.
4. Do heirs agree?
Buyout, sale, or a 1031 for some heirs.
Need a value for the estate or trust?
A confidential written valuation from closed sales. No obligation.
Run the Numbers Both Ways
We model the hold (new property tax, rents, expenses) against a sale (net of commission, transfer taxes and any ULA) so the family decides on numbers, not guesses.
Broker opinion of value for the inventory, a written marketing record and weekly reports to counsel.
Frequently Asked Questions
Will the building be reassessed if we keep it?
Usually. Prop 19 limits the parent-child exclusion to a family home or family farm, and the BOE says a rental home between parents and children does not qualify (BOE Prop 19 FAQ). Budget for a higher tax bill.
What is the step-up in basis?
Inherited property generally takes a basis equal to its fair market value at the date of death (26 U.S.C. §1014), which can shrink the gain if you sell soon. Ask your CPA.
Can one heir buy out the others?
Often, with the attorney's help. A written valuation gives everyone a fair starting number.
Do RSO tenants affect value?
Yes. Rents below market lower today's value; buyers price in the upside and the rules. Protections stay with the building.
Can heirs who want cash and heirs who want to reinvest both win?
Sometimes, with planning by your attorney and CPA, including a 1031 exchange for those who stay in real estate.
Does Measure ULA change the math?
Inside the City of LA, a sale over $5,400,000 pays 4% and $10,900,000+ pays 5.5% on top of the 0.45% base tax (our ULA guide).
Talk to David about your building
Send the address and your role. You will get a value range and a plan for your attorney.
We are real estate brokers, not attorneys, CPAs or tax advisors. Nothing on this page is legal or tax advice; confirm every decision with your attorney and CPA. Statutes quoted from leginfo.legislature.ca.gov, checked Oct 31, 2026.