Foreclosures hit newer suburbs

[A.Malina]

http://www.charlotte.com/local/v-print/story/397430.html

Posted on Sun, Dec. 09, 2007
New suburbs
in fast decay
LIZ CHANDLER AND TED MELLNIK
A band of new suburban neighborhoods that held promise for thousands of Charlotte families is now struggling with crime, blight and falling home values.

These neighborhoods were hit hard by the wave of foreclosures rattling the nation. Damage is most visible in starter-home subdivisions across northern Charlotte, and in pockets in the east and southwest.

The best of them show subtle signs: Vacant houses. Overgrown weeds. Trash piled at the curb.

The worst of them already resemble decaying urban neighborhoods that keep police and housing inspectors busy -- and cost Charlotte millions to repair.

While the crime rate citywide held steady, the rate in the heart of Charlotte's 10 highest-foreclosure areas rose 33 percent between 2003 and 2006, an Observer analysis found. All of them are suburban areas filled with starter-home subdivisions. They were built since 1997 with homes valued at $150,000 or less.

Windy Ridge is 5 years old, but already 81 of its 132 homes have lapsed into foreclosure. Dozens stand boarded up or vacant, with windows smashed and doors kicked in. Vandals have ripped copper wire from walls. Vagrants and drug users frequent the empty houses -- next door to families who thought they'd invested wisely in their northwest Charlotte suburb....

Overall, the Observer found more than 50 neighborhoods with elevated foreclosure rates of 15 percent to 61 percent. Virtually all of them are new starter-home subdivisions....


Foreclosures leave houses vacant, creating crime magnets. They also lure bargain-hunting buyers who convert houses to rentals.

Violent crime at rental homes in single-family neighborhoods happens at three times the rate of crime at owner-occupied homes, according to Charlotte-Mecklenburg police. The property crime rate is 1.6 times higher.

"When you have vacant houses, people can do all kinds of things," says police chief Stephens. "We're even seeing spillover to neighborhoods around them."

In Peachtree Hills, police are summoned nearly 300 times a year, mostly for property crimes in the 147 homes. But the 4-year-old neighborhood, near Sunset Road, has also seen robberies, shootings and gang displays more commonly associated with violent urban areas -- not new subdivisions....


A Chicago study found that when the foreclosure rate increases 1 percentage point in a neighborhood, its violent crime rate jumps 2.3 percent.

[MRS. NORTHSIDER]

I just read an article in the Trib this past week about Neumann Homes filing for bankruptcy and it's effect on their Clublands subdivision in Antioch.  Shells of homes standing without doors (a good target for vandals) and things at a standstill with the town of Antioch having to help out residents who bought and moved in before any hint of trouble with the builder.  I guess the grass really isn't always greener on the other side.   

[gizmodog]

Neumann Homes going under is bad news.  Closer to home, Berwyn reportedly has had 300 new foreclosure cases this year.  What's that mean to the value of homes in Berwyn?

[Bru67]

Neumann Homes going under is bad news.  Closer to home, Berwyn reportedly has had 300 new foreclosure cases this year.  What's that mean to the value of homes in Berwyn?

Any time you put more of something into a market it is going to put a downward pressure on prices.  Economics 101.  A good way to counter that in our case would be to market the community to groups Berwyn may have ignored (or who may have ignored it) in the past.  Hopefully that marketing program can help with that.