Despite the growing wealth gap, driven partly by racial disparities in homeownership, there is an emerging focus on a relatively obscure aspect of land ownership known as heirs’ property.

Heirs’ property is land inherited without a formal will or any legal documentation that establishes ownership.

The absence of clear ownership documentation means that inheritors of heirs’ property risk losing their land to exploitative investors or government claims. Additionally, as this property is divided among descendants, it may shrink into such tiny parts that it becomes virtually valueless.

This issue predominantly affects Black families, especially in southern regions. While it’s hard to accurately assess the extent of heirs’ property due to the lack of records, a 2023 study by Fannie Mae estimates it to be worth at least $32 billion.

In responding to these property loss issues, recent legislative efforts are underway in Congress aimed at rectifying past injustices and safeguarding families against future loss.

In areas with a high concentration of heirs’ property, a staggering 75% of the population is Black, according to the Fannie Mae report. Historical data shows that Black Americans acquired about 15 million acres of land in the 45 years following the end of slavery, but by 2001, roughly 80% of that land had been lost.

Kirk Malmberg, CEO of the Federal Home Loan Bank of Atlanta, remarked on the economic growth in the South, saying, “Many families have benefitted financially, yet there are property owners who should share in that prosperity but are held back by unclear titles and the difficulties in passing property to heirs. As a result, a significant portion of wealth generated in these communities is not being transferred to those who rightfully deserve it.”

Federal home loan banks serve as regional financial institutions that provide necessary capital for mortgage lending and community development. Recently, FHLBank-Atlanta launched the 2024 Heirs’ Property Family Wealth Protection Fund (FWP), dedicating $5 million to aid organizations in handling heirs’ property challenges.

An earlier initiative by FHLBank-Atlanta, which allocated $1 million, successfully cleared 157 property titles, unlocking approximately $16 million in equity. Furthermore, wills were established for 516 individuals. The bank is currently seeking applications from community organizations as well as municipal and governmental entities for funding to tackle heirs’ property issues.

Earlier this year, Congresswoman Nikema Williams, a Democrat from Georgia, joined two other Democrats in introducing a bill that aims to encourage states to assist in legal efforts aimed at clearing titles and ensuring current property owners have legal protections.

The Heirs’ Estate Inheritance Resolution and Succession (HEIRS) Act has garnered support from numerous organizations, including the American Land Title Association, National Fair Housing Alliance, National Association of Real Estate Brokers, National Low Income Housing Coalition, National Consumer Law Center, National Housing Resource Center, National Association of Realtors, and the Urban League of Greater Atlanta.