When banks leave homes vacant and in disrepair, neighboring property values decrease, property tax revenue is lost and the city must pay for upkeep, code enforcement, and often police services.
Foreclosure: The Cost Communities Pay, recommends the City take action to recover much of the costs from financial institutions.
A single foreclosure can cost local governments $5000 – $34,000 in maintenance, inspection fees, public safety calls, and so on. In San Diego over the five years since the crisis began in 2008, that has totaled between $134 million and $855 million, CPI found.
In addition, the lost property tax revenue from San Diego foreclosures is estimated at $117 million, and the combined wealth lost by owners of foreclosed homes and neighboring homes is more than $19 billion.
The report provides data on lost home value and costs for all zip codes in the city. It recommends remedies that include holding banks accountable for those neglected properties and preventing future foreclosures by protecting jobs with good wages.
Foreclosure numbers provided courtesy of RealtyTrac.