When homeowners die without having taken legal steps to pass on their property, it can create problems that put a family’s generational wealth at risk.
A recent report by the think tank Detroit Future City found 5,525 Detroit properties where all the recorded, legal owners are deceased. This month, the Michigan House passed legislation designed to help address the issue of so-called “heirs properties” across the state.
Michigan Public Morning Edition host Doug Tribou spoke to one of the bill’s sponsors, state Rep. Emily Dievendorf (D-Lansing). Dievendorf represents the 77th House district, which includes parts of Clinton, Eaton, and Ingham counties.
Doug Tribou: In many heirs’ properties cases, there are multiple family members who have a legal claim, but none of them own the home. That means they can’t access equity for home repairs, or apply for property tax aid programs. They can’t sell the home.
Your bill is known as the “Uniform Partition of Heirs Property Act.” What are some of the key changes it would make and the protections it would provide?
Rep. Emily Dievendorf: The act ensures that there is a process in place, that there is due process — regardless of whether you have a will — in order to ensure that you can pass down your property to your descendants, to your heirs. Having this process in place not only preserves that generational equity, but it also ensures that the house — when or if it is sold by the heirs — is able to be sold at its actual value and not the much diminished value that often happens in a fire sale when a property is partitioned.
But really, the core purpose of this legislation is to ensure that people can hold on to their homes in the first place. And to hold on to farmland, as this gap in the law has disproportionately impacted farmers, and black and brown farmers, in particular.
"The core purpose of this legislation is to ensure that people can hold on to their homes in the first place and to hold on to farmland."State Rep. Emily Dievendorf on the Uniform Partition of Heirs' Property Act
DT: To touch on one of the things that you mentioned there, the forced sale or fire sale, in a lot of cases a developer will come into an heirs' property situation, buy out one of the family member's claims, and then once the developer owns that claim, then they can go ahead and force the sale. How does this bill address that issue?
ED: This piece of legislation ensures that every heir to the property would be able to decide whether they want to hold on to a piece of the property, or if they want to sell it and to become a part of the negotiation to determine what that sale looks like.
DT: I'm just imagining a scenario with, I don't know, say, four or five family members. In that case, if there's one holdout and the other four want to sell. How would that play out?
ED: That one heir that is holding out might be able to hold on to a portion of the land. And if they aren't able to hold on to that piece of the land, they would be in a negotiating position to be able to really get the value out of that piece of property — if together they decide to sell the property — whether that's a house or whether that's a farm.
DT: The report from Detroit Future City highlights several neighborhoods in Detroit that were disproportionately affected by heirs' property issues. But, as you mentioned, homes in other cities and rural areas can be vulnerable as well. How would this bill affect residents in your district? What are you hearing from them?
ED: I inherited a district, after these new redistricting lines, that includes a huge rural area and, of course, the city of Lansing, which is struggling with the housing crisis in every way that we know that our urban cities are. So this is going to help my district in helping people hold on to the housing that that already exists.
But it also helps my particular district to hold on to small family farms. Part of my interest in the legislation is that I come from a family that did own land since the early 1700s, and I am from a farming family — that early, [although] not as of recently. So I know the value of the generational equity that my family has built.
DT: The bill has passed the Michigan House and now will move to the Senate. What is next in the process and how much support do you expect the bill to have in the Senate?
ED: At this point, the legislation goes on to be heard in committee and then to the full Senate for a vote. I expect very strong support. When we passed this in the House, it passed with 94 votes and was a bipartisan vote because we do know that whether we're talking about the housing crisis, whether we're talking about generational equity, or whether we're talking about closing a really annoying gap in probate law that no attorney likes, just about everybody sees a benefit to this legislation.
DT: Representative, thanks a lot for your time.
ED: Thank you so much for having me. I really appreciate you covering this important legislation.
Editor's note: Some quotes in this article have been edited for length and clarity. You can listen to the full interview near the top of this page.
