Dealing With Chicago’s Vacant Buildings Is Not an Open-and-Shut Matter
On October 8, the Chicago Tribune published an article titled Dealing with Chicago’s Vacant Buildings Isn’t an Open-and-Shut Matter.
Dealing with Chicago’s vacant buildings isn’t an open-and-shut matter
Problems in West Humboldt Park illustrate how daunting the epidemic has become
Dorothy Leonard has lived for 33 years in the same house on the same block in West Humboldt Park, one of the better blocks in the struggling West Side Chicago neighborhood.
She’s the block’s unofficial ambassador, shooing away young people who gather on the corner, telling neighbors where to go for help and calling the city when she sees a burned-out street lamp or plywood removed from a window at one of the boarded-up homes.
Two years ago, her neighborhood was chosen for renewal and reinvestment by the city and nonprofit community groups. Additionally, Chicago beefed up an ordinance to crack down on the city’s estimated 18,000 abandoned properties and those owners and mortgage servicers who fail to register buildings.
There was a belief that, despite the problems, areas such as West Humboldt Park could be nurtured back to health. The real estate market’s recovery has added to expectations that Chicago might see its vacant building problems alleviated.
Yet vacant, unsecured buildings still litter the neighborhood, providing havens for squatters and illegal activity such as arson, drug dealing and prostitution. Many buildings haven’t been registered, so the city is not collecting the fees and officials don’t know who to notify in case the property isn’t maintained, is broken into or is damaged. On Leonard’s block, only one vacant building has been registered.
Has there been progress?
“It’s really kind of hard to tell,” Leonard said.
The city’s worst problems are in the already battle-scarred West and South sides, but even neighborhoods like Belmont-Cragin, where there are vacancies but not many board-ups, find themselves struggling to see signs of accountability.
Today, only 5,158 vacant buildings are registered in the city, less than one-third of the estimated total that are vacant. And even registered buildings often aren’t in full compliance with requirements.
For example, the one registered board-up on Leonard’s block doesn’t have a sign out front showing who is responsible for it.
With little discernible progress being made, the city wants to hold owners and mortgage servicers of vacant buildings even more accountable for the eyesores that pepper its blocks. But the ordinance won’t apply to buildings in foreclosure with mortgages backed by Fannie Mae or Freddie Mac, after the city lost a federal court challenge to the ordinance.
Meanwhile, crime is festering as more buildings become vacant. Last year, more than 2,600 crimes were reported in Chicago’s abandoned buildings and vacant lots, up 48 percent since 2005, according to a study by Lawyers’ Committee for Better Housing. That equates to an average of seven crimes a day.
The battle to grapple with the issue is evident in West Humboldt Park. Although riddled with foreclosures, the neighborhood was thought to be attractive to first-time homebuyers and residential investors because of its access to parks and public transportation. The median price of a single-family home in August was $66,750, compared with $175,000 for the city as a whole.
One of the original nine areas picked for the city’s “micro-market recovery pilot program,” its 32 blocks are roughly bordered by Central Park Avenue on the west, Franklin Boulevard on the south, Kedzie Avenue on the east and, on the north, Augusta Boulevard from Central Park to Homan Avenue, and Chicago Avenue from Homan to Kedzie.
At the time the program was announced, Neighborhood Housing Services of Chicago Inc., a nonprofit, counted 115 vacant single-family and multifamily homes within those 32 blocks, and traced ownership of 40 percent of them to investors.
Two years later, 38 of those 115 properties are vacant and boarded. Sixteen have been demolished. Sixty-one have been identified as occupied.
Meanwhile, an additional 35 homes are newly vacant.
“It’s two steps forward and one step back, and that would be a good day,” said Ed Jacob, Neighborhood Housing Services’ executive director. “The rougher days would be when it’s two steps forward and two steps back.”
From 2000 to 2010, Humboldt Park’s population fell by 14.4 percent, according to census data. As residents moved out, thieves have moved in, stealing furnaces, copper pipe, even the address numbers. Some buildings have been damaged so severely that they have been marked with a big red “x,” a sign the Chicago Fire Department uses to warn first responders the buildings could be hazardous.
Many of the neighborhood’s vacant graystones and brick two-flats are in various states of disrepair. Plywood covers the front windows of some, but side windows are smashed and wide open. Others aren’t secured at all. Young men routinely congregate on the front steps of empty buildings. On a recent day, two men sat by a card table on a vacant home’s front porch.
The city envisioned West Humboldt Park attracting investors, and that has happened. But not all building purchases are positive.
Some buyers are speculators who apparently plan to hold on to properties until they can flip them at a profit or when the housing market fully recovers. In the Neighborhood Housing Services’ fall 2012 update of its 2011 building survey, 20 investor-owned buildings, most which were bought from 2009 through 2011, remained vacant. Two others had been demolished.
“I’m calling them buy-and-board investors,” said John Groene, neighborhood director of Neighborhood Housing Services’ office in West Humboldt Park.. “They bought it, but it’s been a year and it’s still sitting boarded.”
Trying to locate people responsible for such buildings is difficult, if not impossible. Groene said that even when he combs through public real estate records, it’s not unusual for buildings to be owned by limited liability corporations without individuals listed.
“You never know who it is,” he said.
Buildings that have been abandoned by such owners pose their own problems. The court process by the city to take ownership of abandoned buildings takes at least a year.
Still, here and there are small, but welcome, signs of progress, such as two construction workers carrying drywall and tool buckets into a brick two-flat on a recent morning.
There also are some success stories generated by the work of city and community groups to boost the number of owner-occupants. A case in point is a former renter that Neighborhood Housing Services staffers met while canvassing the area with a camera. The staffers helped negotiate a purchase-rehab loan so she could buy her own home in the neighborhood and move out of her apartment in a foreclosed building.
“Every time we save a building and help someone buy it and rehab it, it’s sending a message to people that already own their home that ‘My home is worth something. I’m staying,'” Groene said. “That helps keep your spirits up.”
Just identifying vacant buildings isn’t easy, which is why the city wants to add even more teeth to its registration law so officials know more quickly which ones have been abandoned.
“It’s a moving target a lot of times,” said Michael Merchant, the city’s building commissioner. “We’re always going to be chasing the vacant buildings.”
The city’s building department has 27 inspectors. So it also relies on police and community residents to help identify problem buildings, Merchant said. “We’re looking for the ones that are dangerous, providing havens for crime,” he said.
“If there was no regulation here, the situation would be worse,” Merchant said. “If you’re a bad actor, we’re going to get to you at some point.”
One of West Humboldt Park’s more troubled stretches is North St. Louis Avenue, blocks rife with vacant and abandoned buildings, some with their front doors ajar. On the 900 block alone, from Aug. 4 to Sept. 16, there were 11 crime reports filed with the city. They included heroin possession, theft, burglary, battery and criminal damage to property, according to city data.
Those homes are only one street from Leonard’s block, considered one of the 15 stronger blocks in the area that is more likely to attract first-time homebuyers. But convincing a homeowner who has purchase options elsewhere can be a challenge.
Take Ceil Sykes. The armed services veteran and mother of a 19-year-old college student has lived her whole life on the West Side.
Now renting half of a two-flat in the Austin neighborhood, Sykes is hoping to take advantage of the financial incentives available, like down payment assistance and subsidized purchase-rehab loans, to consumers like herself who are willing to bear the risks involved in buying and rehabbing a vacant home in a challenged neighborhood.
“There’s just so many vacant buildings, so many,” Sykes said as she rifled through a stack of papers that included the address of various vacant buildings she has looked at, if only from the sidewalk. “I know the people want better. I’m just hoping that the area, in the next eight to 10 years, has stood the test of time.”
She has looked at 30 buildings in West Humboldt Park and East Garfield Park, drawn to the neighborhoods by their proximity to the Garfield Park Conservatory, parks and public transportation options.
But it has not been an easy search. Address numbers are pried off homes, and with no contact information on them, she doesn’t know who to call to inquire about them. She doesn’t bother with houses where locks are broken, because that indicates they’ve been vandalized.
“They’re just devastated,” she said. “The walls are torn out for the copper pipes, so you have water damage. I’ve seen animals. It’s just amazing. There has to be something that tells me this is a house that can be recovered.”
One of her favorites is a brick two-flat with open front porches on North Central Park Avenue. It has been vacant for at least three years and is scheduled to go to foreclosure auction this year. It was registered as vacant in January 2012, more than a year after the city began receiving 311 calls about problems at the building.
The southern “gateway” to the neighborhood is the 500 block of North Central Park, and it exemplifies the uphill battle the neighborhood’s recovery faces. Neighborhood Housing Services has been named the receiver of four abandoned buildings in a row. They are kept secure, minimal repairs have been made to keep the exteriors safe, and the plywood on the windows has been painted a uniform shade of gray.
The receivership process has taken more than a year, and Neighborhood Housing Services knows it will be unlikely to attract a first-time homeowner to the properties, since there are several vacant buildings in a row. A few of the properties are likely to become affordable rental housing for veterans.
Miguel Nogueras grew up in Humboldt Park, lives in West Humboldt Park and works in the area as an agent for Zip Realty Inc. He sees the area slowly improving, but he said he has seen homebuyers beat out by investors’ cash offers, investors who rehab the properties and turn them into rentals, and others who board them up and wait to flip them. Those investors worry him.
“If you’re going to buy something, rehab it, rent it out, but don’t leave it in the condition it’s in,” Nogueras said. “To leave a property abandoned creates disinvestment in a neighborhood. It increases crime, it erodes the tax base.
“It’s a complicated issue. It’s a free society. People have a right to purchase a property and do what they want to do, but we don’t live on an island. We live in a community, and people need to think about that.”
To view the online article, please click here.
About Safeguard
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders, and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.
