Probate Q&A Series

What is a buyout option and how is fair market value determined for my share? – North Carolina

Short Answer

In a North Carolina partition case involving heirs property, a buyout option lets one or more co-owners purchase the interests of those asking for a court-ordered sale at the court-determined fair market value. The clerk first decides whether the land is “heirs property,” then orders an independent appraisal of the entire property. Co-owners get a short window to elect the buyout and another to pay. The court can account for taxes, necessary expenses, and similar contributions when allocating amounts.

Understanding the Problem

In North Carolina, if you co-own inherited land and a partition action is filed, can you purchase other heirs’ shares instead of selling the property, and how will your share’s value be set? Here, you and relatives inherited land with two occupied mobile homes, and you paid property taxes for several years.

Apply the Law

In North Carolina, partition cases start with the Clerk of Superior Court. If the property is “heirs property,” special rules apply. The court orders an appraisal to determine the fair market value (FMV) of the entire property as if owned by one person, not discounted for fractional interests. The court then notifies all co-tenants of the value and sets firm deadlines to elect a buyout and to pay. If a buyout occurs, the selling co-tenants receive their proportion of the appraised FMV, with the court able to adjust shares for taxes and necessary property expenses paid by a co-tenant. If no buyout closes, the court proceeds to divide the land in kind if practical; otherwise, it orders a sale using court procedures.

Key Requirements

  • Heirs property finding: The clerk determines whether the land qualifies as heirs property; if so, the statutory buyout process applies.
  • Independent appraisal: A disinterested, licensed appraiser sets FMV for the entire parcel as a whole unit, not per‑share discounts.
  • Notice and election: The court gives written notice of FMV and sets a short window for eligible co-tenants to elect to buy the selling co-tenants’ interests.
  • Payment deadline: The court sets a payment deadline; if multiple buyers elect, the court allocates purchase proportions.
  • Adjustments and accounting: The court may account for taxes, insurance, necessary repairs, or improvements when allocating proceeds or ordering owelty (cash adjustments) between co-tenants.

What the Statutes Say

Analysis

Apply the Rule to the Facts: If the clerk finds your inherited land is heirs property, the court will order an appraisal of the whole tract (including consideration of the occupied mobile home sites and any leases) to set FMV. You can elect to buy out any heirs who seek a sale by paying them their proportional share of that appraised FMV. Your prior payment of property taxes can be addressed through the court’s accounting so that reimbursements or credits are considered when the court allocates amounts.

Process & Timing

  1. Who files: Any co-tenant. Where: Clerk of Superior Court in the North Carolina county where the land sits. What: Special proceeding for partition; request an “heirs property” determination and appraisal if applicable. When: After filing and service, the clerk sets the appraisal order and later sets buyout election and payment deadlines.
  2. The court appoints a disinterested appraiser. After the appraisal, the clerk serves notice of the FMV. The court sets a short window to elect the buyout and a subsequent deadline to pay; these periods are firm and can be measured in weeks, so track them closely.
  3. If the buyout closes, the court enters orders transferring interests and making any reimbursements or owelty adjustments. If no buyout, the court considers division in kind (with surveys if needed for the mobile home sites) or orders a sale under judicial/open‑market procedures.

Exceptions & Pitfalls

  • If the land is not “heirs property,” the statutory buyout option may not apply; the case proceeds under general partition rules.
  • FMV is for the whole property without fractional-interest discounts. Timely object if the appraisal overlooks leases, access, encumbrances, or the status of mobile homes as real vs. personal property.
  • Keep proof of taxes, insurance, and necessary repairs; the court can credit these in accounting or via owelty, but only if documented.
  • Tenants and leases carry through to valuation and sale; ensure proper notice and confirm whether any lease affects market value or sale terms.

Conclusion

In North Carolina heirs-property partitions, a buyout lets co-owners purchase the interests of those seeking a sale at the court-ordered fair market value set by an independent appraisal of the whole tract. The clerk sets strict deadlines to elect and pay, and can adjust shares for taxes and necessary expenses. If you want the buyout, file your election with the Clerk of Superior Court by the deadline stated in the appraisal notice and be prepared to tender payment on time.

Talk to a Partition Action Attorney

If you’re dealing with an heirs-property partition and want to understand the buyout process and valuation, our firm has experienced attorneys who can help you understand your options and timelines. Call us today.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.