Home Foreclosures Leading to Urban Blight

Remarkable stuff today in a Federal Reserve hearing about how home foreclosures are already leading to urban blight in some areas. I find it somewhat of a stretch, and I’m guessing that at least some of the blight predates the recent rate increases — that is, there’s an element of opportunistic local officials looking for handouts — but I’m willing to be convinced otherwise:

“We have found neighborhoods with abandoned homes, 200 at
a shot,” said Louise Gissendaner, senior vice president and
director of community development in Cleveland at Fifth Third
Bancorp, the 10th-biggest U.S. bank by assets. She said
abandoned housing has “devastated our city to a great degree.”

…Fed officials heard stories from Cleveland, Philadelphia,
Denver and New York, where neighborhoods are deteriorating as
borrowers struggle to pay loans or abandon their homes in
foreclosure, a process where lenders take possession of

Keep an eye out here for the eventual hearing transcripts.

[via Bloomberg]


  1. Andrew Mahon says:

    The url to the Fed site did not work.