Nearly half of families avoid discussing estate planning despite recognizing its importance.
Housing experts convened at the Urban Institute on Monday said some states have passed more laws in recent years, but there isn’t nearly enough education about the scope of the problem.In the coming decades, an estimated $124 trillion in wealth is set to change hands globally—but tens of billions of dollars in US real estate may never reach its intended heirs.
Housing experts convened at the Urban Institute on Monday said some states have passed more laws in recent years, but there isn’t nearly enough education about the scope of the problem.“The lack of wills just absolutely sends the family into the wood chipper,” says Ryan Thomson, associate professor at Auburn University, who studies heirs’ property. It can be a costly exercise for families, too. Inheritance disputes can consume huge legal resources, such as the real estate fortune of Sol Golman. But all wills must go through the probate process, and experts expect problems to ensnare many, many more along the way.Quantifying the problem is difficult. The US Forestry Service’s Southern Research Station estimated $42 billion in property, across up to 5.3 million acres, could belong to heirs in 11 Southern and Appalachian states alone. Fannie Mae’s Housing Assistance Council Heir disputes used to be thought of as a rural issue, Thomson says. But that’s not the case anymore with housing as such a major part of a family’s net wealth. Boston College estimated there could be 10,400 properties worth $1.1 billion in disputes in Philadelphia and 5,500 worth $268 million in Detroit, for instance.The US Forestry Service’s Southern Research Station estimated $42 billion in property, across up to 5.3 million acres, could belong to heirs in 11 Southern and Appalachian states alone.Most localities don’t single out property sales that are subject to heir disputes. But patterns have emerged. Those stuck with sudden home assets once their parents die already face a whirlwind of That’s where the problems begin. In most areas of the US, the property defaults to a “tenancy in common,” where heirs receive equal interests in a property. The home loses its homestead exemption, and the heirs fall behind on the tax obligation. If they disagree on what to do with the property, they can end up in court for years, racking up legal fees. And that’s where “predatory” investors come in and scoop up properties for far less than they’re worth, Thomson says. They acquire a small share of the property from one family member, then petition to force a sale. But more research on the subject is stymied, Thomson explains, because those investors and speculators then use it to target vulnerable communities.These laws add due process protections such as notice, appraisal, and right of first refusal requirements. But a myriad of other legal issues could encumber a property after the owners’ death, threatening the generational wealth they intended to leave for their children, says Thomas Mitchell, director of Boston College Law School’s Initiative on Land, Housing, and Property Rights.The “Partition of Heirs Property Acts” add due process protections such as notice, appraisal, and right of first refusal requirements.The problem stems most deeply from the lack of an elaborated will or estate plan. A Boston College survey found that just 57% of people had a will. And that number is significantly lower among people with a high school education or less, as well as racial minorities. For some of these people, there’s a lack of understanding of how to craft a will, Mitchell says. But there can also be a simple matter of uncommunicated wishes. About 68% of parents aged 55 or older with at least $500,000 in investable assets “A lot think this starts with drama among the family, but really it starts with silence,” says Ashley Edwards, founder of AAA Probate Resources, which works with heirs in . “If there’s no shared understanding of who the decision-makers should be, you really put the property in a vulnerable situation.” Real estate agents need to be proactive to help homebuyers put in writing what they want to happen to their properties when they die, Edwards says. It often takes a few tries to convince them of the need.Pentagon preparing for weeks of ground operations in Iran — as Trump warned regime to ‘get serious’ about peace deal: reportMichigan builder buys abandoned mansion for $1 — and turned it into a $1.1M home One of the world’s most famous design offices launches ultra-luxe prefab homes -- for a fraction of the price of a standard houseTaron Egerton can’t keep his hands — or lips — off Brooks Nader during steamy beachside dateIn the coming decades, an estimated $124 trillion in wealth is set to change hands globally—but tens of billions of dollars in US real estate may never reach its intended heirs.Housing experts convened at the Urban Institute on Monday said some states have passed more laws in recent years, but there isn't nearly enough education about the scope of the problem.The US Forestry Service's Southern Research Station estimated $42 billion in property, across up to 5.3 million acres, could belong to heirs in 11 Southern and Appalachian states alone.Stream It Or Skip It: 'Jo Nesbø's Detective Hole' On Netflix, Where A Troubled Detective Tracks Down A Serial Killer Who Is Terrorizing Oslo
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