Neighborhood Watch: How You Can Fight Blight

As foreclosures sweep the nation, crime, vandalism, and decay threaten the suburbs. Here's what you can do.

When T. J. Stone moved to Green Valley Ranch more than two decades ago, he loved everything about it. The sprawling housing development was 17 miles from polluted downtown Denver, and the community offered friendly neighbors, acres of parks, and stunning mountain views. Stone paid $88,000 for his home on 44th Place, a 2,300-square-foot split-level built in 1983, with a pear tree and maples in the front yard. Before the foreclosure crisis, the house had appreciated to more than double that amount and the pear tree had grown to 30 feet. But when the banks descended on Green Valley Ranch, Stone began to notice something new-abandoned homes and creeping blight.

After a two-bedroom place nearby on 42nd Avenue was foreclosed, the homeowners' belongings were hauled out to the curb. They sat for days, until neighbors called the homeowners' association to clean up the mess. Local kids broke into a vacant house a block from Stone's and used it for a paintball war. "The drapes were gone," Stone says. "I could look in and see paint over everything-the walls, the windows, the appliances." Other properties grew weeds and scrub brush, or they attracted looters who tore out bathroom fixtures and stole copper plumbing for scrap metal. Still others were sprayed with graffiti.

Green Valley Ranch was hit hard and early by the foreclosure crisis. Of 4,800 homes, more than 150—or 1 in every 32—are currently owned by banks, and dozens have been defaced or damaged.

The rest of the country is catching up. Nationwide, 1 out of every 70 homes is now in foreclosure; in the hardest-hit states, like Nevada, it's 1 in 17. The Mortgage Bankers Association estimates that 2.2 million homes went into foreclosure in 2008 alone, and another 1 in 10 Americans is a month or more behind on his or her mortgage.

Often these homes sit in legal limbo for months while the foreclosure paperwork winds its way through the local courts. After banks take possession and the properties become eyesores, local residents watch their property values plunge. The Center for Responsible Lending estimates that 41 million homeowners will see their home value decline an average of about $8,700 as a result of nearby foreclosures.

Even upscale neighborhoods aren't immune. In Phillips Landing, a wealthy gated community southwest of Orlando, Florida, where lakefront Mediterranean-style houses sell for as much as $4 million, 23 out of 365 homes were emptied by foreclosures in early 2008. The homes are relatively new and didn't need much maintenance. The homeowners' association hired a landscaper for the lawns. But the swimming pools were another story.

“The pool in the property behind my backyard was like a swamp for eight or nine months,” says Frank Rubino, president of the Phillips Landing homeowners' association. "First it was green, and then it went black. We actually had a plague of frogs for a while." Rubino tried getting the bank to hire a maintenance company—with no luck. "Most banks say, 'Until we take possession of the property, we can't legally comment on it,'" he says. "It takes them somewhere between 9 and 11 months to sort through the paperwork and catch up." More than half of the foreclosed homes in his community remain unsold today.

In some areas, the damage can be far worse-even deadly. Partying teenagers broke into a long-vacant home in West Babylon, New York, and did $20,000 worth of damage, including knocking holes in the walls. A five-year-old girl drowned after falling into a pool behind a foreclosed home in an Indianapolis suburb. In November, a firefighter in Detroit was killed battling a blaze in an abandoned home, which investigators later determined had been caused by arson.

Local governments can normally handle situations like these, but they are overwhelmed. Florida's Orange County budgeted $400,000 this year to respond to housing code violations—problems like overgrown lawns, unsafe houses and pools, and broken windows. "We hate to leave places looking like 1983 Beirut," says Robert Spivey, the county's manager. But his department went through the entire year's budget in just three months. In a typical year, the county demolishes about 20 homes so far behind in repairs that they're unsafe; this year, Orange County expects to knock down 50 or 60. For the thousands of homeowners who left the city to escape urban blight, it's a grim situation as decay threatens to overwhelm the suburbs too.

But a growing number of homeowners are fighting back. In Connecticut, Colorado, and California, neighbors are working together to reclaim their streets. Ardena Perry has lived in her 1,600-square-foot ranch house in the Vistas, a development in Sparks, Nevada, since 1997. Three percent of its 1,500 homes have been foreclosed, damaging the curb appeal of neighboring houses. But Perry and her neighbors aren't waiting for the cavalry to ride to their rescue; they're mowing lawns, pulling weeds, picking up trash, and collecting phone books on vacated properties themselves. Perry is out a lot, strolling the neighborhood with her two Newfoundlands and her German shepherd. "This is a walking community," Perry says. "We notice when a house is empty."


In December, Perry even took Christmas cards ("the ones you don't really care about," she says, "from the doctor or the dentist") and put them on the doors of foreclosed homes near hers so they would look occupied. In January, she took them down. "The solution to blight is within your community," Perry says. "It isn't some bank in Switzerland."

In Tomahawk Village, a development west of Phoenix, Arizona, residents are attacking crime. Thirty years ago, the community attracted young families and engineers who worked at nearby Luke Air Force Base. But immigration, unemployment, and the housing crisis have rocked the solidly blue-collar Tomahawk Village. Homes have been burglarized and graffiti is a persistent issue. Residents formed a neighborhood block watch to bolster police efforts. Recently, the group has focused its attention almost exclusively on vacant houses. "They're being stripped," says Carol McKeever, 56, a legal secretary who owns a 25-year-old cottage in the community. "At one place, someone had taken the front door off. About ten houses down, same thing. We had another house where the copper plumbing had been ripped out of the sprinkler system in the front yard."

Last April, residents got so fed up that they began keeping a database of all vacant homes in the development. (Currently, there are 275, out of 2,600 total, including seven of ten houses on one street alone.) The database lists whether the property has a pool and security issues like broken windows or fences. McKeever drives every street in the neighborhood at least once a month to update the list and scours public databases for valuable information like deeds of sale and banks holding specific homes in her area.

The database gets sent around to the members of the block watch and also to the local police and neighborhood services departments. "The city of Phoenix has been phenomenally responsive," says McKeever. "If we call in something, like a home with a missing window, they have all the information they need, and they'll be out within a week to board it up." For green pools, Maricopa County will even come out and release minnow guppies, which eat mosquito larvae (though the county won't actually drain the pools). "The pools still look bad, but the guppies keep the West Nile virus away," McKeever says.

Suzanne Thraen has lived with her husband in Tomahawk Village for the past 30 years and serves on the board of the block watch association. She's careful to note that they don't advocate going onto foreclosed properties to clean up, since it's technically trespassing; the association could be liable if a volunteer were to get hurt. "As an organization, we don't do it," she says. "As individuals, we do."

Especially in cases when they've gone through official channels and been rebuffed. "On many occasions, the mortgage company or the real estate agent is just not responsive," Thraen says. She tells of an empty house at the end of her street. "There was a broken window, then a second broken window, then a third. We called a couple of times." Each time, no response. "Then graffiti-the fence had been broken down, and the whole back of the house, side of the house, and inside was tagged." Without permission, two residents went in and scrubbed it. "We can't tolerate graffiti in a square mile like ours," Thraen says. "You get two of those on a block and that whole block is gone."

Tomahawk Village is so organized in its fight against graffiti that Thraen's husband, Rex, bought a used golf cart and outfitted it for the mission. Instead of golf bags, the rear compartment holds four five-gallon buckets of paint.

Green Valley Ranch in Denver is perhaps the most aggressive in dealing with foreclosed homes.

The rules of its homeowners' association give residents the legal right to go onto someone's property to fix health and safety violations. "We can mow lawns, fix a broken gate, clean up trash," says association president T. J. Stone. And that's exactly what they did when the owners of the foreclosed home on 42nd Avenue dumped their stuff in the street—"lamps, broken tables, everything the owners didn't want to take with them," Stone recalls. The association hired a private company to cart it all away, two truckloads' worth, at a cost of $1,200. It also hired a landscaper to mow the lawn and pick up trash. (The association then placed a lien on the property, giving it the right to recoup the cost once the house is sold.) For homes that need bigger repairs, it gets a court order.

The association has set aside almost $100,000 for things like repainting trim and replacing windows. Stone expects that that amount will cover the rehabilitation of about ten homes. "The money will go fast," he says. But if the spruced-up properties find buyers, the banks or the new owners will repay the costs, the fund will get replenished, and the association can turn to other abandoned properties. "We're hoping to make this program self-sufficient," says Joanne True, a 14-year resident of Green Valley Ranch and secretary of the homeowners' association board. "We want it to grow and grow."

For houses in the worst shape, Green Valley Ranch has secured federal funds. The U.S. Department of Housing and Urban Development is spending about $4 billion on the most blight-prone communities around the country. Some $16 million will be used to buy up the worst homes in three Denver neighborhoods, including Green Valley Ranch. Most of those homes will be demolished, and the properties will be landscaped. The lots will be turned over to the city, which will ultimately build new housing.

One likely target of such funds is a house on Perth Street, which has been empty since mid-2008. The windows were broken and vandals got inside and set a fire. The homeowners' association has cleaned up the yard multiple times and hired a contractor to board up the windows and padlock the front door. Yet ironically, because the house is in such bad shape, the bank has refused to officially foreclose on it and take possession. "It's because of all the damage," Stone says. "They don't want the cost of tearing down the building."

That goes to the heart of the issue—no one wants these homes. Not the neighbors, not new buyers, and definitely not the banks. Until the housing market turns around and the number of vacant homes starts to decline, even the most successful community effort will have a hard time making lasting change. Jim Gillespie, president and CEO of real estate giant Coldwell Banker, says volunteer efforts like these can be "somewhat" effective in protecting real estate values. But he argues that the federal government is still too focused on shoring up banks instead of helping bring buyers back into the marketplace. The banks are also to blame. "Banks need to speed up every phase of the process," Gillespie adds. "That lag is a big challenge right now."

In the meantime, communities will keep doing everything they can. Says Ardena Perry in Sparks, Nevada, "A recession will bring out the worst or the best in people. We're just hunkering down and saying, Okay, we'll get through this."

Do More

• Talk to your neighbors and enlist volunteers to keep tabs on nearby homes. An overgrown lawn is usually the first sign that a property has been foreclosed. Report problems like broken or missing windows to the local police or to your town's housing department.
• Collect flyers, junk mail, and loose trash and listen for abandoned pets, a growing problem in vacant homes. But don't turn on the hose, even to water the lawn (broken pipes will cause damage), or plug into an electrical outlet (a potential fire hazard).
• Use your local homeowners' association. If the community rules don't allow trash or lawn cleanup on vacant properties, vote to change the rules. Check guidelines at the Community Associations Institute.
• Establish a neighborhood watch program if you're worried about crime. The National Sheriffs' Association maintains a network of these groups and a website offering tips on starting one.
• Tap into groups that can help, like the National Vacant Properties Campaign, which holds conferences on maintaining empty homes.
• Take preemptive action to educate yourself and your neighbors about how to keep your homes. Check out Hope Now, a partnership between debt counselors and lenders or call 888-995-HOPE).