Do you have to go through probate to sell an inherited house in Michigan?
Usually the house has to clear probate (or a small-estate/affidavit shortcut, or a trust or transfer-on-death deed) before you can pass clean title to a buyer. The exact threshold and the shortcut available depend on Michigan law and how the estate was set up, so confirm your path with the Michigan probate court or an estate attorney before you list.
Will you owe capital gains tax when you sell?
Usually very little. An inherited home gets a stepped-up basis to its fair-market value on the date of death (IRC §1014), so if you sell near that value there is almost no taxable gain. This is federal and applies in Michigan like everywhere else — one of the few rules that makes selling an inherited house simpler than people fear.
What does the house cost you while probate runs?
Every month the estate is open, the home keeps costing money: Michigan property taxes (about 1.54%/yr on the value), insurance on a often-vacant house, utilities, and upkeep. Those carrying costs are the real bleed, and they land whether or not anyone is living there.
Four numbers that decide an inherited Michigan sale
- Median sale price
- $298,000 (Redfin state market tracker, May 2026)
- Property tax
- ~1.54% a year — the #11 highest rate of the 50 states and D.C. — about $382 a month on a median-priced home
- Typical sale costs
- about $24,019 on the median — $18,476 commission (6.2%) + $2,980 closing costs + $2,563 transfer tax
- Transfer tax rule
- State transfer tax of $3.75 per $500, plus county transfer tax of $0.55 per $500. Seller typically pays.
- Market clock
- 24 days median to go under contract (Redfin state market tracker, May 2026)
Price on paper vs. money in the estate
The gap between the two numbers surprises most families. A median Michigan sale prices around $298,000 (Redfin state market tracker, May 2026), yet after roughly $18,476 of commission at 6.2%, about $2,980 of closing costs and roughly $2,563 of transfer tax, the estate actually books closer to $273,981. Mortgages and liens riding on the title shrink it further. Whatever the family decides — keep, rent, list, or sell as-is — decide it against the after-cost number.
The meter runs while the paperwork does
Vacant or not, the house keeps spending the estate's money: about $382 a month of property tax on a median-priced Michigan home at the state's ~1.54% rate (#11 highest nationally), plus insurance, utilities, and upkeep nobody living there is watching. When the estate is finally free to sell, the median listing still needs about 24 days to find a buyer (Redfin state market tracker, May 2026). Put those months against the after-cost value above and the carrying cost stops being an abstraction.
When the house comes with unpaid property taxes
If the person who passed had fallen behind on property taxes, that debt now shadows the house. Property-tax foreclosure is a separate judicial in-rem process: taxes forfeit to the county on March 1 of year 2, and the owner may redeem until the MARCH 31 immediately following entry of the foreclosure judgment (or 21 days after judgment in contested cases). (MCL 211.78g(3); MCL 211.78k) The deadlines are statutory and county-enforced, so confirm where the property stands with the county and bring any notices to a Michigan attorney before deciding how — or how fast — to sell.
The honest math on an inherited Michigan house
Because the stepped-up basis usually erases capital-gains tax either way, the real comparison isn't tax — it's months of carrying costs plus agent commission (about 6%) against a clean cash sale that closes in days once you're legally cleared to sell.
A cash sale can close fast once probate clears title. Confirm the probate path with a Michigan attorney, then weigh the certainty against the retail upside.
