OUP - Abstract

The Impacts Abandoned Properties Impose Upon Neighborhoods

Dissertation School: University of North Carolina at Chapel Hill

Abstract:

While the ongoing mortgage crisis has brought heightened awareness to housing problems nationwide - including foreclosed, abandoned, and vacant properties - the problem of housing abandonment is not new. Long before the current mortgage crisis, many large metropolitan areas were already grappling with the problems of housing abandonment and neighborhood decline. This problem, however, is no longer confined to older cities but spreading to small towns and suburbs across the country due to the recent foreclosure crisis.

Scholars argue that housing abandonment can harm a neighborhood by lowering property values and increasing crime rates. The economic loss is not confined to the abandoned structures and nearby properties, however. Lost tax revenues from tax delinquent, abandoned properties harm the community as a whole. This subsequently affects the ability to finance public services, which exacerbates the problems associated with abandonment.

Despite the extent of the housing abandonment, research on the topic and the development of effective policies to address it have not been at the forefront of urban research or policymaking in recent years. Unfortunately, housing abandonment has traditionally been viewed as an outcome of market failure or of neighborhood life cycles.

Past research on abandonment demonstrates that it lowers nearby property values, and that blocks with high vacancy rates also have high crime rates. However, little is known about how the impacts of abandonment vary in neighborhoods with different conditions, and what neighborhood characteristics moderate the impacts of abandonment. Plus, no research has looked explicitly for nonlinear relationships between abandonment and its impacts, which would identify the most opportune times for government intervention. And I have been unable to find empirical studies on relationship between abandonment and neighborhood decline over time.

In sum, despite the prevalence of the housing abandonment problem, there is a relative absence of knowledge on its pattern and its causes. Hence, this research attempts to extend the current level of understanding of the relationship between housing abandonment and neighborhood decline by providing empirical findings on areas that have not been addressed by previous research. Further, increased understanding of the relationship between abandonment and neighborhood decline will result in more effective public policies.

To achieve this goal, this research attempts to answer three primary research questions: What is the relationship between housing abandonment and neighborhood decline as measured in the decline in nearby property values?; Is there a threshold in abandonment beyond which a neighborhood declines dramatically?; and Are some neighborhoods more resilient to the negative impacts of housing abandonment? And if so, why?

To answer the research hypotheses, I will conduct a quantitative analysis using longitudinal data of housing abandonment and its impacts in Baltimore, Maryland, between 1991 and 2010. And I attempt to construct and employ analytical models that represent theoretical and methodological improvements over earlier research efforts. I use the repeat sales methodology to estimate the impact of housing abandonment on nearby property values and spline regression to estimate the thresholds. In addition, I use latent growth modeling to examine why some neighborhoods are more resilient to the negative impact.

This research attempts to make a significant contribution to the current planning literature and research by providing findings on questions that have not been addressed by previous research. Further, this research hopes to extend the level of understanding of relationship between abandonment and neighborhood decline to better inform public policies. Estimates of impact of abandonment on nearby property values would provide a basis to project the potential benefits from renovating abandoned houses. Plus, understanding the thresholds of impact would help identify the most opportune times for government intervention or to better allocate limited resources.

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