Vacant Properties Stalling Housing Recovery
October 9, 2012
Vacant homes pose a major challenge to the housing and economic recovery, and greater solutions need to be explored for handling the high numbers of abandoned homes, says Elizabeth Duke, Federal Reserve board governor.
Duke says that too many of the vacant homes are not even for-sale on the market. But as they sit vacant, they are falling into disrepair and hampering neighboring property values.
"Vacant homes can be more than just an eye sore; they can have substantial negative impacts on the surrounding community, impacts that are felt most acutely by the neighbors and communities that must cope with the dangers and costs of vacant buildings," Duke said at a recent meeting for the Federal Reserve Bank of New York.
Duke says that investors are stepping in to snag up a large number of the vacant homes in higher-income areas as they seek to turn them into rentals. But how about the other homes left vacant?
Duke says other solutions need to be explored, such as demolition of homes in areas that are showing no signs of recovery but have a large number of distressed homes.
"[I]n Cuyahoga County, home to Cleveland, Ohio, about 80 percent of the approximately 100 properties per month that the land bank acquires need demolition, but at $10,000 in average costs per demolition, the Cuyahoga Land Bank is struggling to find the resources to fund this activity," Duke said.
Source: “Elizabeth Duke: House Vacancies Block Full Economic Recovery,” HousingWire (Oct. 8, 2012)
Updated: June 20, 2018