According to a Government Accountability Office report, while banks "are not properly maintaining" the growing number of vacant and foreclosed properties nationwide, resources required to demolish the large number of long-term vacant properties have exceeded local budgets.
GAO found that the number of non-seasonal vacant properties increased 51% nationally from 7 million in 2000 to 10 million in April 2010.
These findings represent a public warning about the risks associated with the high volume of vacant properties.
Unless these REOs are either well maintained or demolished the suspected result can be: higher crime rates, abatement issues, public safety concerns, increased maintenance costs to local governments, decreased value of surrounding properties, and a loss of tax revenue.
Among others Rep. Elijah E. Cummings and Rep. Dennis Kucinich, ranking members of the House Committee on Oversight and Government Reform and the Subcommittee on Regulatory Affairs, Stimulus Oversight and Government Spending are calling for action.
So far, GAO reported, some cities have passed ordinances that require servicers to notify the city when an REO is vacant "and attempt to hold them responsible for maintenance."
The problem however is equally unmanageable for both the banks that are overwhelmed by the volume at hand and local governments, most of which do not have the resources to demolish long-term vacant properties.
GAO examined data on vacant residential housing units in Baltimore, Chicago, Cleveland, Indio, Calif.; Detroit, Indianapolis, Las Vegas, Cape Coral, Fla.; and, Tucson, Ariz.
