Can a Power of Attorney Sell a House? The Rules for Attorneys and Families

Selling a Loved One’s Home Under a Lasting Power of Attorney

When a parent or other family member becomes unable to manage their financial affairs, selling their home can become a difficult and emotional decision.

Perhaps they have moved permanently into residential care, and the property is standing empty. Alternatively, they may need funds to pay for care, adaptations or other expenses.

If you have been appointed under a Lasting Power of Attorney, you may be wondering whether you have the legal authority to sell the property.

The answer is often yes, but there are important restrictions. An attorney must act within the authority given by the Lasting Power of Attorney and comply with their legal duties. Where the person who made the LPA has lost mental capacity, decisions must be made in their best interests.

In this article, our private client team explains when an attorney can sell a property, when Court of Protection approval may be required and the issues families should consider before proceeding.

What Attorneys Can and Cannot Do When Selling a Property

An attorney acting under a registered Property and Financial Affairs Lasting Power of Attorney can generally sell the donor’s property where the LPA gives the necessary authority and the sale is lawful and appropriate. However, the attorney must consider the donor’s wishes, capacity, circumstances and best interests.

A sale to the attorney, a relative or another connected person can raise conflicts of interest and may require Court of Protection approval. Selling the property below market value can also require court authority.

Which Type of Lasting Power of Attorney Allows a Property Sale?

There are two types of LPA. A Property and Financial Affairs LPA can authorise attorneys to deal with money, bank accounts, investments and property.

A Health and Welfare LPA deals with decisions such as care arrangements, medical treatment and where the donor lives. It does not, by itself, authorise the attorney to sell the donor’s property. The distinction is particularly important where different family members have been appointed under the two LPAs. Read our earlier guide: ‘Health & Welfare LPA vs Property & Financial Affairs LPA Explained’ for more detailed information.

Does the LPA Have to Be Registered?

Yes. A Property and Financial Affairs LPA must be registered with the Office of the Public Guardian before it can be used.

An unregistered LPA does not provide the attorney with the authority needed to complete a property transaction. The solicitor dealing with the sale will need appropriate evidence of the attorney’s authority. We discussed some of the issues families can face in a previous article: When Families Run into Problems Without a Lasting Power of Attorney.

Can an Attorney Sell a House While the Owner Still Has Mental Capacity?

Potentially.

A Property and Financial Affairs LPA can permit attorneys to act while the donor still has mental capacity, depending on the wording of the document and the donor’s permission.

However, the attorney cannot simply disregard the donor’s wishes. Where the donor has capacity to decide whether to sell their home, their decision must be respected.

Having an LPA does not transfer ownership of the property to the attorney.

What if the Owner Has Dementia?

A diagnosis of dementia does not automatically mean that a person lacks capacity to decide whether to sell their home. Mental capacity is decision-specific.

The relevant question is whether the person can understand, retain, use or weigh the information necessary to make the particular decision and communicate their choice.

Where the donor has capacity to make the decision, they should make it themselves, with support where appropriate.

Where they lack capacity, an attorney with the necessary authority may make the decision in accordance with the Mental Capacity Act 2005.

Can an Attorney Sell a House to Pay Care Home Fees?

Yes, where the attorney has the necessary authority and the sale is in the donor’s best interests. For example, selling may be appropriate where the donor has moved permanently into residential care, the property is no longer needed and funds are required to meet care costs.

However, the attorney should not assume that moving into care automatically means the home must be sold.

They should consider:

• Whether the move is permanent
• The donor’s wishes and previous preferences
• Whether the property might still be needed
• The cost of maintaining it
• Available savings and income
• Whether renting the property is a realistic alternative
• The donor’s long-term care needs
• Any relevant interests of other people living at the property

The decision should be based on the donor’s circumstances, not simply on what would be most convenient for the family.

Does the Attorney Have to Sell the House?

No. An LPA gives authority to make appropriate decisions; it does not automatically require a property sale.

There may be good reasons to retain the property. For example, the donor may be expected to return home, or the property may be occupied by a spouse or another person whose rights need to be considered.

The attorney should review the available options and the financial implications.

Can an Attorney Sell the Property Below Market Value?

This requires particular caution. Attorneys have duties to protect the donor’s financial interests. A proposed sale below market value can amount to a gift or otherwise raise issues outside the attorney’s ordinary authority.

Court of Protection approval may be required. The attorney should obtain legal advice before agreeing to a discounted sale.

Can an Attorney Buy the Donor’s House Themselves?

This creates a significant conflict of interest. The attorney would be acting on behalf of the seller while also having a personal interest in purchasing the property. The Office of the Public Guardian’s guidance explains that attorneys should seek Court of Protection approval where they wish to buy the donor’s property themselves.

A sale at market value does not necessarily remove the conflict. The same concerns can arise where the intended buyer is a relative or another person connected to the attorney.

Can an Attorney Sell the House to a Brother, Sister, or Other Relative?

Potentially, but connected-party sales need careful scrutiny. An attorney should not assume that a sale is permissible merely because the proposed buyer has offered a fair price. There may still be a conflict of interest or a need for court approval.

Where the proposed buyer is connected to the attorney, legal advice should be obtained before contracts are exchanged.

What if the Attorney Owns the Property Jointly with the Donor?

Joint ownership can make the transaction more complicated. For example, an attorney may jointly own a house with their spouse, who has now lost mental capacity.

The attorney may be acting both in their personal capacity as co-owner and as attorney for the other owner. Additional legal requirements can arise, particularly in relation to the receipt of sale proceeds and the appointment of trustees.

It should not be assumed that one person can sign every document in both capacities without further arrangements. A conveyancing solicitor experienced in transactions involving LPAs should check the title and proposed transaction.

Can an Attorney Give the House Away?

Generally, an attorney cannot simply give away the donor’s home. Attorneys have only limited powers to make gifts.

A substantial gift of property will normally fall outside those powers unless authorised by the Court of Protection. This remains important even where the donor previously said they wanted a particular child to inherit the property.

An attorney’s role is not to accelerate an expected inheritance.

Can an Attorney Transfer the House Into Their Own Name?

Not merely because they have been appointed as attorney. An LPA does not give the attorney ownership of the donor’s assets. Transferring the property into the attorney’s name without a proper legal basis can amount to serious misuse of the attorney’s powers.

Any proposed transfer must be examined carefully and may require court approval.

Does the Attorney Need to Consider the Donor’s Will?

The attorney should consider the donor’s known wishes and relevant circumstances, which may include their estate-planning arrangements. However, a Will does not normally prevent a lawful sale of property during the donor’s lifetime.

An attorney cannot refuse to sell a house needed to fund the donor’s care simply because a beneficiary hopes to inherit it. The donor’s current needs and interests take priority over preserving an inheritance. Conversely, an attorney should not sell property unnecessarily merely to alter the eventual distribution of the estate.

What Happens to the Sale Proceeds?

The sale proceeds belong to the donor. They do not belong to the attorney or the donor’s future beneficiaries. The money should be managed appropriately for the donor’s benefit.

Attorneys must keep suitable financial records and avoid mixing the donor’s money with their own, except where an existing lawful joint arrangement applies.

The Office of the Public Guardian can require attorneys to account for how they manage the donor’s affairs.

Can the Family Object to the Sale?

Family members may have genuine concerns about whether a sale is necessary or appropriate. However, being a son, daughter, brother or sister does not automatically give someone authority to veto a lawful decision made by an attorney.

The legal position depends on the donor’s capacity, the LPA, ownership of the property and the circumstances of the proposed sale. Where there are concerns about misuse of an LPA, the Office of the Public Guardian may be able to investigate. In appropriate circumstances, the Court of Protection can determine disputes or make orders concerning the attorney’s authority.

What if There Is No Lasting Power of Attorney?

If the property owner lacks capacity and has not made a valid LPA or another relevant power of attorney, family members cannot automatically sell the property on their behalf.

An application to the Court of Protection may be necessary.

Depending on the circumstances, the court may appoint a property and affairs deputy or make an order authorising a particular transaction. This can involve additional time, expense and court oversight. It is one reason making an LPA while a person still has capacity can be so important.

We discussed some of the issues families can face in a previous article: When Families Run into Problems Without a Lasting Power of Attorney.

Can an Attorney Sell the House After the Donor Dies?

No. A Lasting Power of Attorney ends when the donor dies. From that point, responsibility for dealing with the deceased’s estate passes to the executors or administrators, as appropriate. The attorney cannot continue using the LPA to sell the property. A Grant of Representation may be required before the estate property can be sold.

What Should an Attorney Do Before Selling a Property?

Before proceeding, the attorney should establish that they have the necessary authority and that the proposed sale is appropriate. Important steps include checking the registered LPA, reviewing any restrictions, considering the donor’s capacity and wishes, obtaining appropriate valuations and examining the property title.

Where the donor lacks capacity, the attorney should record why the sale is considered to be in their best interests. If the buyer is connected to the attorney, the price is below market value, or the ownership arrangements are complicated, the attorney should obtain specialist advice before the transaction proceeds.

LPA and Property Sale Advice in Blackpool and Thornton-Cleveleys

A Lasting Power of Attorney can allow a trusted person to sell a home when the owner can no longer manage the transaction themselves. However, it is not an unrestricted power to deal with somebody else’s property. Attorneys must respect the donor’s wishes where possible, act within their authority and comply with the legal requirements governing their decisions. Where a property sale is proposed, especially where the donor lacks capacity or the buyer is a family member, taking legal advice before proceeding can prevent serious difficulties.

MJV Solicitors assists clients with Lasting Powers of Attorney, private client matters and residential conveyancing. We can advise on the authority given by an LPA, the responsibilities of attorneys and the legal issues that arise when an attorney proposes to sell a property.

Our private client and conveyancing teams can work together where the transaction involves both an LPA and a property sale. We assist clients throughout Blackpool, Thornton-Cleveleys, Poulton-le-Fylde, Fleetwood, Lytham St Annes and the wider Lancashire area. Complete our enquiry form or contact us by calling 01253 858231 or emailing us at info@mjvlaw.co.uk

Read our previous article for related information: Protecting Your Future: Why You Should Set Up a Lasting Power of Attorney.

This blog post is not intended to be taken as advice or acted upon. If you are seeking legal advice about selling a property under a Lasting Power of Attorney, please contact our team of solicitors.