Feb 29, 2024 - News

Detroiters confront problems inheriting properties

Illustration of paper cut-out families under outlined houses

Illustration: Eniola Odetunde/Axios

Problems inheriting properties from deceased family members pose largely unexplored barriers to generational wealth-building for thousands of Detroiters.

Why it matters: Building stable homeownership is key for the city's neighborhoods, including by ensuring houses get passed down.

  • But that path can be fractured when an owner dies without a will or other challenges crop up during legal proceedings, nonprofit think tank Detroit Future City (DFC) writes in a new report.

State of play: An "heirs' property" is a family home passed on through informal means without a legal transfer. The person living there may not know it's actually not legally theirs.

  • There are 5,525 such properties in the city worth a total of $268 million, DFC estimates.
  • "Resolving heirs' properties through legal processes can be complicated and costly for those inheriting them," DFC's report reads.

Context: Without the clear title needed to become the home's legal owner, a person can't sell the home or get homeowner's insurance. It can also leave them out of tax or home repair assistance programs.

  • Of the heirs' properties DFC found, nearly 500 are "at immediate risk of tax foreclosure this year."

What's next: Preventing these future property issues requires major informational campaigns about the importance of estate planning, plus policy reforms, the think tank argues.

  • The city needs more affordable legal support for estate issues — Washtenaw County's bar association offers free advice, for example.

Go deeper: See DFC's resource sheet to assist those passing on a house or who have inherited one.

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