Foreclosure in Boulder>Question Details

Boulder Suz, Real Estate Pro in Longmont, CO

What would you do if the house next door were abandoned?

Asked by Boulder Suz, Longmont, CO Sat May 21, 2011

An article in the National Association of Realtors asks this question this month. There are some things that neighbors and real estate professionals can do about the eyesore that is in some state of being disposed of through short sale or foreclosure. Do you think local laws adequately protect homeowners from the variety of hazards that are associated with home abandoned in foreclosure? Are HOAs doing anything to help the situation?

Help the community by answering this question:


Well, the laws in Kansas City are adequate as far as maintaining the property. The problem comes in enforcing those laws with out of state owners. Banks are notorious for allowing homes to literally fall apart while they go their processes. A leak in the roof left unattended invites wood rot, mold, insects, rodents and other destructive forces into the property. Houses broken into and occupied by itinerant peoples also present hazards.

Some HOA's have actually bought homes in their neighborhoods to keep them from deteriorating. The HOA spruces them up and then rents them out. The income goes back into the treasury. This is a great option for HOA's with the funds and organization to do it.

Compelling large banks to take care of the homes they own is another story. I have noticed a small attempt by some banks as well as HUD and FNMA owned properties to address this issue. Unfortunately, their processes take so long that leaks in the home are not attended to for months. Imagine mold, wood rot and rotten carpet.
0 votes Thank Flag Link Sat May 21, 2011
In many communities that I'm aware of in the Los Angeles area, the city has local ordinance that deals with nuisance such as this. They issue citations to homeowners to have the problems corrected. Failure to do take actions may result in criminal misdemeanor. In foreclosure situations, neither the banks nor the homeowners have any incentives to respond t the citation despite the threat of criminal prosecution.

The cities have the right to but not the financial resources to trim the vegetation if the homeowners fail to do so. This crisis has certainly diminished their tax revenues.

Recently there were bills introduced in California to impose mandatory $20,000 on lenders who foreclose on properties as opposed to modify loans to keep homeowners in their homes but it was understandably defeated. The bottom line is that more foreclosures will mean more depressed home prices and reduced tax revenues for local governments and less resources to deal with more abandoned properties.

It is not getting better. There is report that there's about 5 to 7 million more homes in the pipeline that will enter the foreclosure pool if the present economic conditions do not change.

Experts are saying that home prices will not bottom out until 2014. The outlook isn't good. I don't get excited about the recent improvement in employment data. Election is coming next year. So unless I see a sustained trend on the improvement, I take the data with a grain of salt.
1 vote Thank Flag Link Sat May 21, 2011
First discover what regulations apply via local ordinances and homeowners associations. Then determine what actions can or should be taken.....via lender, management company, city or county. Get in touch with those responsibe to find out what can be done to keep up on maintenance. If there is something you can do and you can get permission, I like Abraham's approach. Maybe you can get other neighbors personally involved as well.

While it is in the lender's (and ours as neighbors and taxpayers) to keep up vacant properties this has become a large issue with respect to declining prices. Poor maintenance also contradicts the notion of keeping up the value of the lenders collateral and property values in general. Hopefully those holding property for lenders will become better managers and marketers of real estate.
1 vote Thank Flag Link Sat May 21, 2011
In the 80's HUD homes were all over the Denver Metro area. The first home I ever bought was a HUD home. We of course fixed ours up right away but the neighbors right next door abandoned their home. We kept up the yard throughout the summer. Watering, mowing and trimming. New people bought the home and it never had a chance to bring down property values. Of course they were already way down from the 80's housing crash.
1 vote Thank Flag Link Sat May 21, 2011
This is something you must ask your Broker about what HOA's do or contact a local Real Estate lawyer to see waht the laws are. You cant do too much. The home may be abandoned, You have no rights to the home and the home does belong to someone. Maybe your Broker can advise you on this before you start to do things that may not be legal?, Just because you are an agent, that does not give you any rights to do anything about the vacant home. Contact your HOA to see what they can do.................most likely nothing
1 vote Thank Flag Link Sat May 21, 2011
This is a tough question. Answers can vary widely depending on the neighborhood. It is an unfortunate part of our market right now. Some folks may not care, some may care too much. I suppose the upkeep of the outside is the only thing neighbors can help with.

HOA's can get into trouble if the vacancy and rental rates get to high.
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1 vote Thank Flag Link Sat May 21, 2011
If it was the only abandoned house on the street I would personally keep the front yard mowed and free from trash. If my HOA covered these issues I would approach them to keep up the yard.
1 vote Thank Flag Link Sat May 21, 2011
Unfortunately, the local laws and HOAs don't really do anything. I've seen cases where the neighbors took matters into their own hands, and did what they could to keep the property looking decent. (mowing, watering, removing debris that collects in driveway & front porch, etc.)
1 vote Thank Flag Link Sat May 21, 2011
It was tough choosing a best answer for this question because everyone offered ideas. Some cities have actually condemned blighted areas and bulldozed the homes that were beyond saving. It may come to this for some cities, but appears unlikely here in Boulder County.

Kennytanlaw, that is unfortunate that California's legislators overreached on that law. It seems cities could fine or set up a mandatory system of payment that could mimic snow removal ordinances. Forcing modifications is something the attorneys general for the states seem intent on doing. All we want is for lenders to act like responsible neighbors.

California is a good state to watch. Some of the hard hit areas, like Stockton and Brentwood, have problems stemming from empty houses.

Nature took over in Idaho. Snakes have so infested a home, Chase has hired a service to catch and release the critters that are more nuisance than threat. Check out the story:…

Realtytrac reports that 28 percent of sales in the first quarter were foreclosure sales. Estimates of how many foreclosures are still to come have been consistently reported at 2 million. And the lenders may be sitting on as many as 1 million homes. Meanwhile, legal problems mount for the banks. For instance, class action lawsuits are pending in at least three states, including Arizona. Even though banks can move forward in Florida, the system is so thoroughly log-jammed, it might be years for pending foreclosures to move through the system. And no one is successfully promoting the idea of revving the foreclosure mill there again.

That is tremendous pressure on the banks. And the cost are mounting, too. It seems the banks are trying to move a mountain. All we want is some maintenance. How about getting into the rental business as HUD is contemplating? There are plenty of property management companies in the country that can serve this need.

Thanks everyone. I hope by this time next year, some of those lawns are in bette shape.

PML of Longmont, CO
720 810 0683
0 votes Thank Flag Link Fri Jun 3, 2011
Some excellent points. Thanks for chiming in, folks.

HOAs do what they can. They issue fines to the homes with brown lawns. The problem is those fines and the dues are not paid - not by the delinquent borrower, nor the lender. The eventual buyer is presented with the unpaid dues. The fines are uncollectible if they are not pursued aggressively. A lien, however, is of no use to the HOAs, which many times does not want to become a homeowner even in a sideways moving market. If there is no equity go after, it is pointless and costly.

Cities probably face the same difficulty. However, some have easement right of ways that give them access to yards. HOAs do not have access.

It's unfair to the communities. Two or more properties on one block an hurt property values.

I feel terrible empathy whenever I tour neighborhoods and see an immaculate home surrounded by rundown properties - some of them lived in.

Officially, I can't comment on what neighbors do. I have read, however, that neighbors in hard hit areas are taking care of matters because they know it could be a long time before someone takes care of a property.

Thanks for your comment Kenny. I have friends and relatives out your way and I hear all about it. Hang in there Oakland and Scottsdale!

The eventual buyers might use the opportunity to remove dead grass and replace with larger patios, rock and some strategically placed shrubs and even a garden. It might be difficult to believe we're in a drought after one of the wettest months I can recall here, but we need to conserve water. And, here in Colorado we're still fighting a battle with mosquitos. Less water, means less breeding for those critters.

Best to all of you,
0 votes Thank Flag Link Sat May 21, 2011
There is not much you can do about this. It is an unfortunate situation that happens all of the time in Scottsdale AZ. If the yard is unsightly, I would call the HOA and ask them to take responsibility for the upkeep until it sells. If they refuse you may want to either (1) turn your eyes away or (2) take care of the yard yourself.
0 votes Thank Flag Link Sat May 21, 2011
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