Housing abandonment in the Untied States has been and continues to be a difficult issue for municipalities and governments to deal with. After the housing market crash in 2006, foreclosures reached an all-time high. Many people lost their homes; many too walked out on their mortgages and left their homes for good. By 2009 the problem grew to affect a much larger number of municipalities. The financial burden of these houses on the local governments is quite substantial when the abandonment problem is widespread. Like dominoes, the issue of abandonment spreads and snowballs, bringing down more than just one. According to John Levy in Contemporary Urban Planning, surrounding property values depreciate rapidly and often become abandoned themselves. Issues surrounding abandoned properties include, squatting, drug use, arson, physical damage, and acts of vandalism. The main concern for local governments is the depreciation of tax revenues. As Levy says, “Abandoned properties don’t pay property taxes.”
One interesting issue surrounding the abandonment phenomenon is the concept of Zombie Titles. When someone leaves their home and stops paying for it, many times they think that’s the end. This is not always the case. In some situations, a homeowner will walk away from a home after receiving a notice of foreclosure. If the bank or lender does not follow through on the foreclosing process, the property and liability remains with the homeowner. Many times this goes unnoticed and the fees incurred (during the time it takes to either foreclose fully or sell to a new owner) rack up and are the responsibility of the abandon-er.
There are a number of reasons as to why this happens. Sometimes the lender doesn’t want the property or they have too many already, but when this happens they often fail to inform the homeowner that the foreclosure process has stopped. There is no legal responsibility of the lender to inform homeowners of this. After the real estate crash, this became a more common occurrence as banks had to foreclose on many properties. Because they had so many, they couldn’t handle the financial burden that would go along with temporarily owning all the properties.
Back to the larger picture of abandonment in general; the growing trend has gained popularity and will have to be combated. To remedy this problem, local governments are limited in what they can do. To prevent arson and vandalism they can improve law enforcement oversight of abandoned properties. Another tool they have is some power to stop and improve blight. If the problem is widespread enough, and in bad enough shape, municipalities have the power to redevelop or rehabilitate the area. The problem however; is not going to be solved at the local level. According to Levy the federal government will have to strengthen the housing market in order to reduce the number of foreclosures. As for the zombie title predicament, homeowners must be careful and try to keep updated throughout the foreclosure process. If the bank stops the process, property owners can still be on the hook for costs in back taxes and zoning violations.