Why I Avoid Investing in Michigan
I only invest where property rights are respected, such as Arizona and Texas. Here is a clear example of why. If you are a prospective investor in Michigan, reconsider what you are doing. Things will only get worse in the future.
Property Rights
A Michigan Man Underpaid His Property Taxes By $8.41. The County Seized His Property, Sold It—and Kept the Profits.A state law allows counties to effectively steal homes over unpaid taxes and keep the excess revenue for their own budgets.
Eric Boehm | 11.6.2019 7:40 AM
An 83-year-old retired engineer in Michigan underpaid his property taxes by $8.41. In response, Oakland County seized his property, auctioned it off to settle the debt, and pocketed nearly $24,500 in excess revenue from the sale.
Under Michigan law, it was all legal. And hardly uncommon.
Uri Rafaeli, who lost his property and all the equity associated with it, is just one of thousands of people to be victimized by Michigan's uniquely aggressive property tax statute. The law, passed in 1999 in an attempt to accelerate the rehabilitation of abandoned properties, empowers county treasurers to act as debt collectors. In the process, it creates a perverse incentive by allowing treasurers' offices to retain excess revenue raised by seizing and selling properties with delinquent taxes—even when the amount owed is miniscule, and even when the homes aren't abandoned or blighted at all.