1. Proposal A Tax Uncapping Shock (MCL 211.27a): Under Michigan’s Proposal A, annual property tax increases are capped at inflation or 5% while a property remains with the same owner. Upon transfer or sale, the property’s taxable value “uncaps” to equal the State Equalized Value (SEV), causing tax bills on long-held raw land to jump significantly for new owners.

2. PA 116 Farmland Preservation Recapture Penalties: The Farmland and Open Space Preservation Act (PA 116) grants income tax credits in exchange for 10-to-90-year agricultural covenants. Terminating an agreement early or converting land to non-agricultural development triggers strict payback penalties on years of accumulated tax credits plus interest.

3. EGLE Part 303 Wetland Restrictions: Under Part 303 of the Natural Resources and Environmental Protection Act (NREPA), the Department of Environment, Great Lakes, and Energy (EGLE) strictly regulates filling, dredging, or developing wetlands near inland lakes, streams, or parcels over 5 acres. Unapproved site clearing carries heavy restoration orders, and required mitigation banking credits routinely cause retail buyers to cancel contracts.

4. Winter Access Freeze & High Days on Market: Recreational and rural land across Northern Michigan and the Upper Peninsula (UP) averages 150 to 200+ days on the retail market. Deep winter snowfall freezes physical site visits, boundary surveys, and soil perc tests for 4 to 5 months every year, locking up owner equity.

5. Clay Soil Septic Perc Failures: Heavy glacial clay soils and shallow water tables across central and coastal Michigan frequently fail standard septic drainfield perc tests. Retail buyers routinely pull out when expensive engineered or mound septic systems are required, whereas direct cash buyers purchase acreage strictly as-is.

6. Absentee Overhead & Forest Health Risks: A high percentage of rural Michigan acreage is held by out-of-state owners or non-resident hunters. Unmonitored acreage faces persistent risks of unpermitted off-road vehicle trespass, timber theft, boundary encroachment, and spreading forest health threats (such as Oak Wilt). Selling directly converts non-income-producing land into liquid cash without long-distance management liabilities.

Sources:

1. https://www.dewitttownship.gov/324/PA-116-Michigan-Farmland-and-Open-Space-

2. https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-27a

3. https://www.michigan.gov/egle/about/organization/water-resources/wetlands/state-and-federal-wetland-regulations