“Zombie” properties haunt Austin

February 10, 2014
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A group of community organizers worked from the end of 2012 into the spring of 2013 cleaning out an abandoned two-flat at 4824 W. Van Buren St.

The goal was to provide two families with housing once renovations were complete.

But soon the developer discovered a host of issues. Because the water had not been turned off, the basement had flooded, the roof needed to be repaired and all the fixtures were missing.

And the furnace, pipes, toilet and bathtub had also been removed from the property.

This is just one example of what occurs among hundreds of properties on the West Side.

Elce Redmond, an organizer with the South Austin Community Coalition Council, said as soon as the banks come in and board up these properties, the scavengers appear.

“They completely strip the buildings,” Redmond said. “Then the squatters follow and use the houses for drinking or doing drugs.”

He said many times, there are fires in these buildings because of the drug use, causing residents living nearby even more worry.

“Many of these properties are destroying the very fabric of the community,” Redmond said.

The Woodstock Institute recently released a study that ranks Austin 27th among 77 communities for the number of so-called “zombie” properties from 2008 to 2010.

A property becomes a zombie when the mortgage provider files for foreclosure but never completes the process; no one fully owns the property. This lack of ownership causes properties to fall into poor condition because no one is maintaining them.

Even though the city of Chicago has a vacant building ordinance, a federal court ruling cleared the Federal Housing Finance Agency of any responsibility of properties in Chicago it did not fully own.

FHFA, which is the conservator of Fannie Mae and Freddie Mac, services nearly 60 percent of all mortgages in the nation. This means the majority of homes in Chicago that go into foreclosure may not be maintained under the city ordinance standards if the foreclosure process is not completed.

Michael Aumiller, a research associate at the Woodstock Institute, said in an e-mail that “the FHFA should withdraw its lawsuit and comply with local vacant buildings ordinance registration and maintenance requirements.”

Redmond agreed the FHFA should have to have some accountability for these properties.

“I think they should have to take care of those buildings, especially since the government had to bail them out,” Redmond said.

He said it’s impossible to fix up these properties without money and bank participation.

Aumiller said something should be done to hold the lenders accountable for the properties.

“Mortgage providers should coordinate with local governments, nonprofits and land banks to return zombie properties to productive use,“ Aumiller said.

The Woodstock Institute estimates an additional 3,200 zombie properties citywide are possible by the end of 2015 if nothing changes.

Redmond said the property at 4824 W. Van Buren St. that his organization tried to rehab has been torn down by the city, but there are 252 other houses in Austin that fall into the same category.

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