A rising threat to homeownership: How heirs' property undermines affordable housing

"When Jacob Loud didn't leave a will upon his death, the estate was passed on to each of Loud's five children and successive generations under Louisiana's default inheritance rules. But Loud's heirs never legitimized their inheritance under law, however, which left Jacob Loud's name on the title to the property. The heirs' ownership interest was not legally documented and they were consequently uninformed about their ownership interests and the responsibilities of ownership."

"When one family member went to sell one-twenty-fifth share of ownership, local laws triggered the sale of the entire property, displacing them from an asset that had been in the family for generations. The Loud heirs' story can be seen in families across the nation. For decades, homeownership has been considered the cornerstone of the American Dream, but for far too many families, particularly those in low- and moderate-income (LMI) and minority communities, it has seemingly endless threats."

"Heirs' property creates confusion and potentially leads to rightful homeowners losing their properties and subsequent generational wealth to developers and investors. Its impact on Black homeowners is particularly profound. According to a 2023 report by our partners at the Urban Institute's Housing Matters Initiative, approximately one-third of all Black-owned land in the south is heirs' property, with institutional buyers able to exploit this loophole and force sales during property disputes."

A Louisiana family risked losing a five-generation home originally owned by Jacob Loud, a formerly enslaved ancestor, because Loud died intestate. The estate passed under default inheritance rules to successive generations, but heirs never legally formalized ownership, leaving Jacob Loud's name on the title and heirs uninformed about their rights and responsibilities. When one descendant sold a one‑twenty‑fifth share, local laws triggered sale of the entire property and displaced the family. Heirs' property disproportionately threatens low- and moderate-income and Black homeowners, enabling developers and institutional buyers to exploit disputes and seize land.

Read at www.housingwire.com