Cities and counties across the Rust Belt are ending up with abandoned properties under their control as owners stop paying taxes.
Cleveland’s population has been shrinking for 60 years as the city lost manufacturing jobs. Now, after more than 33,000 foreclosures since 2005, it’s demolishing hundreds of deserted, derelict homes.
An agency started last year to manage abandoned houses in Cuyahoga County, which includes Cleveland, plans to acquire up to 1,000 properties next year, and tear down as many as 900 of them. The city of Cleveland may raze double that amount, according to Gus Frangos, president of Cuyahoga County Land Reutilization Corp.
“You really have to bury the dead right now,” Frangos said. “You have to remove blight. It’s unfortunately on a grand scale.”
Cities and counties across the Rust Belt are ending up with abandoned properties under their control as owners stop paying taxes. In Cuyahoga County, a record 2,400 tax foreclosures may occur this year, said Chris Warren, Cleveland’s chief of regional development.
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The governments are choosing to tear down some buildings rather than sell them as residents move to the suburbs and steel, automotive and manufacturing jobs disappear.
“That decision reflects a perception of what the future is going to be,” said Nicolas Retsinas, director emeritus of the Joint Center for Housing Studies at Harvard University. It’s “the phenomenon of the shrinking city,” he said.
In Detroit, like Cleveland, the population has dropped by more than half since 1950. The city is demolishing more than 3,000 houses, according to Dan Lijana, a spokesman for Mayor Dave Bing. The mayor has pledged to tear down 10,000 abandoned and dangerous homes in his first term, Lijana said in an e-mail.
Detroit has almost 51,000 properties for sale and may add more through this year’s tax-foreclosure auction in Wayne County, where the city is located.
“These cities really have to take on the properties,” said Alan Mallach, a senior fellow at the Brookings Institution in Washington, D.C. “If they’re going to be responsible stewards, they really don’t have a choice.”
Detroit, which has about 911,000 residents, plans to spend $14 million of $47 million from the first grant it was awarded in the federal Neighborhood Stabilization Program to get rid of vacant properties that breed blight.
In Ohio, Cuyahoga County Land Reutilization Corp., also known as the Cuyahoga Land Bank, won a $41 million grant from the federal government’s stabilization program.
The land bank has budgeted about $6.3 million to demolish 605 houses in Cleveland and some of its suburbs, according to a report filed with the U.S. government.
“There’s just not nearly enough money to solve the devastation in these neighborhoods,” Frangos said.
A block on Kinsman Avenue near East 144th Street in the Mount Pleasant neighborhood of southeast Cleveland is pocked with boarded-up homes and empty lots where homes once stood.
Another neighborhood bearing the plywood scars of foreclosure is Slavic Village, also southeast of downtown. On a residential side street off the main thoroughfare of Fleet Avenue, about every seventh home is boarded up.
The Cleveland area’s foreclosure rate ranked in the top third of more than 200 U.S. metropolitan areas in the third quarter, according to Irvine, Calif.-based RealtyTrac Inc.
“Foreclosures continue unabated,” said Jim Rokakis, the treasurer for Cuyahoga County and a board member of the county land bank. “It’s an ugly situation.”
Ohio’s seasonally adjusted unemployment rate was 10 percent in September, the latest month for which figures are available, higher than the national rate of 9.6 percent in October, according to the U.S. Bureau of Labor Statistics. Michigan’s was 13 percent.
The Cleveland metropolitan area’s jobless rate, which isn’t seasonally adjusted, was 9.4 percent, and Detroit’s was 13.4 percent.
Cleveland has 7,000 “vacant and seriously distressed properties,” according to a report by Warren, the city’s chief of regional development. That’s down from 8,009 last year as the city rehabilitated and demolished homes.
For Sun Belt cities such as Phoenix, where there likely will be greater growth than in Cleveland and Detroit, the more practical strategy may be to hold on to homes until the real-estate market recovers, said Terry Schwarz, director of Kent State University’s Cleveland Urban Design Collaborative in Cleveland.
“Depending on the property and climate, it may be possible to mothball the buildings,” Schwarz said.
Meanwhile, in Cleveland, foreclosures are likely to continue as the economy struggles to rebound.
“It’s a dismal picture,” said Rokakis, the Cuyahoga county treasurer. “The only thing positive is this land bank and what we’re doing.”