Estate planning risks $243 billion in family real estate

Lack of estate planning is creating significant financial risks for family real estate, leading to what experts call ‘tangled titles.’ Research from the Urban Institute indicates that approximately 40% of homeowners aged 50 and older do not have a will or estate plan in place. This oversight contributes to an estimated $243 billion in real estate being tied up in potentially disputed titles.

Disputes often arise from shared ownership of inherited property, particularly when ownership is not clearly defined through wills or trusts but exists as ‘tenancy in common.’ Without clear documentation, family assets can fragment across generations, making it difficult for owners to refinance, access improvement loans, or obtain disaster relief.

In such cases, a party may file a partition action to seek court intervention, which can result in forced auctions that drain equity from the property. The Uniform Partition of Heirs’ Property Act (UPHPA) is currently applicable in 24 U.S. states and two territories to address these issues.