Indiana University SPEA Edward J. Bloustein School of Planning and Public Policy University of Pennsylvania AIR American University

Panel Paper: Local Responses to Foreclosure: An Examination of the Effects of Vacancy Ordinances in the Older Suburbs of Cleveland

Friday, November 13, 2015 : 8:50 AM
Stanford (Hyatt Regency Miami)

*Names in bold indicate Presenter

Bernadette Hanlon, The Ohio State University
The concentration of foreclosures has tremendous negative spillover effects on urban neighborhoods. For instance, foreclosed homes can reduce the sales price of nearby homes (Whitaker and Fitzpatrick, 2011) and those that are vacant for long periods of time increase public service costs for municipal governments (Agpar, Duda and Gorey, 2005). Recent work identifies the nature and extent of foreclosure in suburban communities, suggesting a strong relationship between foreclosure and suburban poverty (Schlidt et. al, 2013). As Schafran (2013, 665) notes in his examination of the geography of foreclosures in the San Francisco Bay area, ³certain places are at the center of the [foreclosure crisis] for a reason.² In this paper, I suggest the story of foreclosure is also a contributing story about the slow decline of older suburbs, especially those outside cities such as Cleveland that experienced large scale economic restructuring. Focusing on the Cleveland metropolitan area, I examine how local jurisdictions are fighting back by developing vacancy ordinances to ensure banks and others register vacant houses, keep them well maintained,and prevent the selling of these properties in poor condition.

Using spatial statistics, including spatial linear regression analysis, I find that vacancy ordinances can help stabilize property values and improve property conditions in some older suburbs in Cleveland, particularly in those with particular types of ordinances. The findings from this paper suggest ways local governments responses can help stabilize some of the negative impacts of the foreclosure crisis.


Apgar, W. C, M., Duda, and R. Gorey. (2005). The municipal cost of

foreclosures: A Chicago case study. Minneapolis, MN: Homeownership Preservation Foundation.

Schafran, A. (2013). Origins of an urban crisis: The restructuring of the San Francisco Bay area and the geography of foreclosure. International Journal of Urban and Regional Research, 37(2), 663-688.

Schildt, C., Cytron, N., Kneebone, E., & Reid, C. (2013). The subprime crisis in suburbia: exploring the links between foreclosures and suburban poverty. Federal Reserve Bank of San Francisco Working Paper, 2.

Whitaker, S., and T.J. Fitzpatrick IV. (2011). The impact of vacant, tax-delinquent and foreclosed property on sales prices of neighboring homes. Federal Reserve Bank of Cleveland. Working Paper No. 1123R. Cleveland, OH: Federal Reserve Bank of Cleveland.