When property owners die without a will or other estate plan to legally pass on that inheritance, it can put a family’s generational wealth at risk. These so-called “heirs' properties” are typically passed informally from one family member to another without a legal transfer.
Michigan Gov. Gretchen Whitmer recently signed the “Uniform Partition of Heirs Property Act." The law is designed to help families keep homes and land in the family.
State Rep. Emily Dievendorf (D-Lansing) sponsored the bill. Dievendorf represents the 77th House district, which includes parts of Clinton, Ingham, and Eaton Counties. They spoke with Morning Edition host Doug Tribou.
Doug Tribou: You spoke with us last year when the law was just a bill. Can you give us a refresher on why heirs' properties are a problem?
ED: This bill, the Uniform Partition of Heirs Property Act, addresses a problem that is mostly faced by our middle to low-income property owners. There is a gap in the law in most of our states — thankfully, no longer in Michigan — that has allowed for property in a family to be lost or to be divided up, partitioned, due to the lack of a living will when the property owner dies.
Thousands of homes are at risk of going to fire sale because of this. And this has been one of the leading causes of the loss of Black-owned family farms and family farms owned by low-income neighbors.
"Thousands of homes are at risk of going to fire sale because of this."State Rep. Emily Dievendorf
DT: In these cases, often what happens is, a relative dies and another relative is already living with that person or is living in the home. There's no official transfer of property. What does the new law do to address the issues that you're talking about — the partitioning and the unwanted sales?
ED: We can imagine a widow with three children who owns a small farm. This piece of legislation makes it so that, in the case of a widow who has not specified how the property will be split up amongst heirs, that all of those heirs will have a say in whether they hold on to pieces of that property; whether they sell that together; and whether that stays in the family to build generational wealth. And it slows down the legal process that could put these homes at risk.
DT: So it reduces the ability of one stakeholder to force a sale?
ED: Yes. One tenant, now that we have passed the Uniform Partition of Heirs Property Act, may still decide they want to sell their portion of the property, but the rest of the heirs to the property still have an opportunity to hold on to that equity and to let it continue to build.
DT: That's sort of a right of first refusal?
ED: Exactly.
DT: So, we see some benefits there in the ways that farms would not be broken up. Are there any issues that are more specific to single-family homes, which are a large part of the concern in Detroit and other more developed areas?
ED: All of these issues are present in our urban centers, and over 5000 homes in Detroit are eligible for for this particular harm. And I say harm because in the middle of a housing crisis, another major concern of mine is that people can and do lose shelter because of this. Equity is most present and is most consistently found in real estate for our low-income folks. If they have nothing else and they have a home, that is their main source of stability.
"[I]n the middle of a housing crisis, another major concern of mine is that people can and do lose shelter because of this."Democratic State Rep. Emily Dievnedorf
DT: Is there anything that this legislation misses? Are there other issues related to heirs' properties that you're still hoping to address?
ED: There are several questions around what happens when you have a family member that is difficult to find. What happens if you have a family member that is a distant relative? There is further clarification that we can do. But any additional changes to the law will just be to further clarify. And they should not consistently alter the Uniform Partition of Heirs Property Act as it stands today.
DT: When will the new law go into effect?
ED: That is a great question. And we and we are still looking into that. It was just signed. But we do expect that later this year it will go into effect because we do want to give a certain amount of time for our attorneys and our courts to update their own rules and to get educated on the fact that this process needs to exist.
Editor's note: Some quotes in this article have been edited for length and clarity. You can hear the full interview near the top of this page.
