By Juliana Gonzalez-Crussi, Policy Analyst & Housing Outreach Coordinator, Latino Policy Forum - February 2, 2012
Throughout January and February, the Metropolitan Planning Council (MPC) is curating a blog series on vacant properties in metropolitan Chicago. In the coming weeks, MPC's blog, The Connector — as well as the web sites of some of our partners — will feature posts from elected and appointed officials, policy advocates, finance experts, and others about the many ways we are all working together to get a handle on this growing regional and national housing and community development challenge. The opinions expressed in these posts do not necessarily reflect MPC's opinion. Follow the blog series at www.metroplanning.org/vacantproperties.
Take a walk down a block in any predominately-Latino neighborhood and you’ll be confronted with one the United States’ greatest present-day ironies: As one household is overcrowded, its space stretched to accommodate extended family or friends who have fallen on hard times, the home next door sits vacant, its windows covered with plywood and its yard untended.
Latino families live in overcrowded households—the rate has historically hovered around 25 percent—as thousands of homes in their communities now sit vacant. And, paradoxically, the cause of these two separate-but-related phenomena is often the same: foreclosure.
Foreclosure has stripped homes from thousands of families in Chicago’s predominately-Latino wards and suburbs—and has forced many of these same families to bunk up with relatives and acquaintances, feeding the startling overcrowding trends in Latino communities. Ironically, as multiple families now grapple for space under one roof, thousands of foreclosed, unoccupied homes are becoming Real Estate-Owned (REO) properties, reclaimed by the bank after an unsuccessful foreclosure auction. As REOs homes are almost always vacant, they often fall into disrepair, decreasing the value of neighboring homes, attracting crime, and causing high residential turnover.
While foreclosure filing rates in Latino neighborhoods have slowed during the first half of 2011, these communities are hardly in the clear: Authorities must now address the fate of the thousands of REO properties in Latino communities, ensuring that they don’t become vacant, crime-enticing eyesores. That’s why the Latino Policy Forum has been vocal in its support of the vacant property ordinance recently put forth by the Cook County Board of Commissioners, and stands in support of a similar ordinance in Chicago. Both hold banks and mortgage holders accountable for the upkeep of their REOs, imposing fines for those that fail to maintain their properties.
From a Latino perspective, such forward-thinking ordinances couldn’t have been enacted in more critical locales. In Chicago, a shrinking city with a growing Latino population, there were still more than 1,800 foreclosure filings in predominately-Latino wards in the first half of 2011. And the call to action around vacant properties is especially urgent in Chicago’s suburbs, particularly suburban Cook County, which saw a 54 percent increase in its number of Latino-occupied homes since 2000. In west suburban Cook County, home to predominately-Latino suburbs like Cicero, Berwyn, and Melrose Park, 94 percent of foreclosed properties are REO, and most likely vacant. Not only are the sheer number of suburban foreclosure filings higher, but these emerging Latino and immigrant communities also lack the social safety nets often found in larger cities.
Tolerating the status quo, the continued deterioration of vacant properties rubs salt in the already-deep wounds caused by the housing crisis in Latino neighborhoods. Pre-bubble burst, Latino families were heavily targeted for sub-prime and predatory loans. And post-bubble, would-be Latino homeowners are rejected for loans at twice the rate of other metro Chicagoans, slowing investment and recovery in these same communities. Latinos, five times more likely to hold their homes as an asset over corporate stock, have been devastated by sinking home values, exacerbated by the sorry state of neighboring vacant properties in their neighborhoods. (Average wealth in Latino households, tied closely to home values, fell 66 percent between 2005 and 2009, the largest decrease of any ethnic group.) And depreciating property values have negative implications for local tax revenues, already disproportionately low in communities of color.
The Latino Policy Forum applauds city- and county-level officials for their efforts to establish safer, more stable communities—Latino and otherwise—across the region. The Forum encourages City Hall to stay strong in the face of a pending lawsuit against the Chicago vacant property ordinance. And while the Cook County ordinance applies only to unincorporated areas of the county, local municipalities can chose to enforce the ordinance within their boundaries. It is our hope that distressed communities will take additional steps to protect growing numbers of vulnerable local homeowners.
The Chicago area has the largest inventory of foreclosed homes in the nation. Latino or otherwise, it benefits us all to maintain vacant properties in local neighborhoods, protect home values in hard-hit communities, and connect displaced families with options for quality, affordable housing.
For more information about housing policy in Latino communities, contact Juliana Gonzalez-Crussi with the Latino Policy Forum or visit www.latinopolicyforum.org.