This is a guest post written by Katelyn Wright, Executive Director of the Greater Syracuse Land Bank.
As the i-team mentioned in their last post, Syracuse is an older City with older building stock. Historic buildings and neighborhoods with real walkable neighborhood centers are an asset that Syracuse should celebrate. As more and more people want to live in neighborhoods with character, Syracuse has that to offer. Just as these older neighborhoods are built atop aging infrastructure, which requires maintenance, the homes themselves typically require more maintenance than a new home would. On top of that a weak real estate market and concentrated poverty leave many homes suffering from deferred maintenance.
These neglected structures, like the City’s water pipes and roads, now require a significant investment in renovation to keep them viable. In many cases the amount of renovation needed and/or the amount of debt accumulated against the property are so great, that the owners walk away and stop paying the taxes. In the past, these properties would sit in limbo, Code Enforcement citing an owner who no longer lived there. Once buildings deteriorated to the point of posing a threat to public health and safety, the City would get a court order to demolish the structure. They then put a lien against this lot, putting it ‘underwater’ since the resulting lot is almost never worth the cost of the demolition.
The Land Bank enables the City to foreclose on these tax-delinquent properties and convey them to an agency tasked with returning them to productive use. We often receive 4-6 lots in a row, which each previously had a separate owner and were all ‘underwater’ – not worth someone purchasing when you consider the amount of tax liens against them. Foreclosure wipes out that debt and enables the Land Bank to assemble them together into one larger site, making it more attractive for development. When the City forecloses on structures the Land Bank completes a conditions evaluation, sorting some into our demolition pipeline and classifying others as renovation candidates. The City’s act of foreclosure wipes out tax liens and any other liens against the property that might have diminished its value and been an impediment to someone making an investment in renovation. By cleaning these properties out, wiping out those liens, and letting people walk through and inspect the property prior to making an offer, we’ve taken properties that before would only attract investors willing to take a significant risk and made them available to a much wider pool of buyers.
When the Land Bank was created in 2012 there were 4,000 properties in the City that were tax-delinquent enough to be foreclosed upon. We expected that ½ would pay and avoid foreclosure if given notice and that the other ½ would be conveyed to the Land Bank. To date, the City has foreclosed on approximately 1,300 properties. The Land Bank has demolished 175 blighted structures and sold 440 homes to local buyers. These properties represent $15.9 million in assessed value returned to the rolls – generating approximately $800,000/year in local property taxes. The buyers are investing about $17.4 million in renovations – generating local wages, sales tax, and permit fees. This has enabled us to be much less reliant on local government funding, leveraging private investment to support our neighborhood revitalization goals.
5201 S. Salina Street is a great example of a land bank success story. This home was badly neglected and, located at the corner of a main entrance to the neighborhood, really diminished visitors’ perception of the neighborhood. Finally foreclosed upon, the Land Bank was able to place strict conditions on the sale and find a local investor willing to fully renovate the home, turn a previously unfinished attic into a master suite – adding square footage to the small home – and then sell to an owner occupant within 12 months. The added square footage and beautiful renovation enabled them to sell for top dollar, helping to drive up comps in that neighborhood and support the surrounding home values. Pushing house values upwards helps increase nearby homeowners’ equity, enabling them to borrow for improvements and further increase the value of homes in that neighborhood. This type of investment should also generate a decent return for the developer who flipped the home, hopefully encouraging them to come back and do more land bank properties.
Looking back at the theme of Infrastructure Week - Time to Build - the Land Bank gives Syracuse new approaches to dealing with housing infrastructure, which in the long term helps to build in neighborhoods across the City.
Executive Director at the Greater Syracuse Land Bank
Katelyn is the Founding Executive Director of a county-wide land bank created to assemble blighted, vacant, and abandoned property under single-ownership, engage in preventive maintenance, and market properties for return to productive uses consistent with the community’s Comprehensive Plan. Previously, she served as a Land Use Planner for the City of Syracuse Bureau of Planning & Sustainability, where she was a primary author for the City of Syracuse's Land Use & Development Plan 2040. She has her Master's in Regional Planning from Cornell University, and her BA in Political Science from Washington University.