Banks in US demolish, give away homes
The sight of excavators tearing down vacant buildings has become common in this foreclosure-ravaged city, where the housing crisis hit early and hard. But the story behind the recent wave of demolitions is novel - and cities around the country are taking notice.world Updated: Oct 14, 2011 00:19 IST
The sight of excavators tearing down vacant buildings has become common in this foreclosure-ravaged city, where the housing crisis hit early and hard. But the story behind the recent wave of demolitions is novel - and cities around the country are taking notice.
A handful of the nation's largest banks have begun giving away scores of properties that are abandoned or otherwise at risk of languishing indefinitely and further dragging down already depressed neighbourhoods.
The banks have even been footing the bill for the demolitions - as much as $7,500 a pop. Four years into the housing crisis, the ongoing expense of upkeep and taxes, along with costly code violations and the price of marketing the properties, has saddled banks with a heavy burden. It often has become cheaper to knock down decaying homes no one wants.
The demolitions in some cases have paved the way for community gardens, church additions and parking lots.
The task of plowing under the homes rests with the Cuyahoga County Land Reutilization Corp, which grew out of a 2009 state law aimed at creating "land banks" with the power and money to acquire unwanted properties and put them to better use.
The efforts have led other states to pursue similar laws to deal with their own foreclosure epidemics. New York passed a comparable measure this summer. Similar legislation is in the works in Georgia, Philadelphia and elsewhere.
Bank of America and Wells Fargo announced plans this summer to donate more than 100 properties to the land bank. JP Morgan Chase also has made regular donations, and several other banks have given sporadically. "It feels great that we're able to help nonprofits, help neighborhoods, help families," said Tyler Smith, of Wells Fargo, which donated 300 properties nationwide last year and is on track for about 1,000 this year.
Thanks in part to the steady stream of donations, Cuyahoga land bank officials expect to complete roughly 700 demolitions by the end of the year.
In an exclusive partnership with The Washington Post. For additional content visit www.washingtonpost.com.
First Published: Oct 14, 2011 00:16 IST