Foreclosed Homes Present Storm Risk and Shelter Opportunity~

The surge of home foreclosures in the current real estate bust is presenting towns and counties with a thorny policy problem, as unoccupied properties fall into disrepair. In Massachusetts, the Cape Cod Times reports, more than 25,000 houses have been foreclosed since the beginning of 2007, with 1,106 of the foreclosures occurring in coastal Barnstable County on Cape Cod (" Houses going to seed after foreclosure," by Matthew M. Burke). Cape Cod Times reporters found properties overgrown and with broken windows. They also found it difficult to discover who owned the foreclosed homes, as they tried to trace ownership back through a web of banking transactions: "Many of the banks and mortgage companies that have taken properties back have either gone under themselves, have repackaged and sold their assets, or are just not taking responsibility," the Times reported. One property reporters looked at was foreclosed on in January by Lehman Brothers Holding Company, which filed for bankruptcy last year; Barclays Investment Banking and Capital Markets, which acquired some Lehman assets, would neither confirm nor deny owning the property. Another property was foreclosed on by Deutsch Bank National Trust Company, but a Deutsch Bank spokesman told the Times that the bank was only acting as a trustee for IndyMac Bank, which was shut down by Federal regulators last year. In coastal regions, unoccupied and poorly maintained houses are uniquely vulnerable to damage in a hurricane. In South Florida, the Miami Herald reports, some towns with severe wind-hazard exposures, such as LeHigh Acres, are also among the nation's communities worst hit by the foreclosure crisis (" Empty homes pose threat during storms," by Tamara Lush). "Unoccupied, these homes would be defenseless in a storm; there will be no one to put up shutters, batten down garage doors and otherwise secure homes," reports the Herald. And if a storm rips off their roofs and smashes their walls, the abandoned houses could become sources for flying debris that endangers nearby occupied homes. Viewed across the entire Atlantic and Gulf coastal region, the problem is enormous. As of March, 2009, a Herald analysis of an Associated Press database called the Economic Stress Index revealed, "there were 281,691 homes in foreclosure in Florida and coastal counties in Alabama, Georgia, Louisiana, North Carolina, South Carolina, and Virginia." The ability of banks to manage the burden is stretched thin; Florida communities are struggling to get banks to even mow lawns on the properties they have taken over, much less harden the homes to face storm winds, the Herald reports. And so far, Florida emergency officials have no program to address the issue. However, the empty houses may finally be registering on Florida emergency managers' radar screens. During a Federal and state hurricane exercise drill last week, acting director Ruben Almaguen of the Florida emergency management division proposed using the state's empty dwellings as emergency housing for hurricane evacuees in the event of a major hurricane strike. The exercise made clear that conventional emergency housing resources would be inadequate to handle some hurricane scenarios, said Almaguen. Foreclosed homes could supply the solution, he argued: "We can't not look at something staring us directly in the face." The Miami Herald covers that story (" Foreclosed Florida homes considered for hurricane housing," by Mark Caputo and Shannon Colavecchio). It's not clear how Federal and state officials could gain the legal authority to turn the empty properties to their own purposes, even though in many cases the legal owners may be unavailable even to secure the buildings against intrusion by squatters or wild animals. Towns and counties are still researching the basic question of whether they have the right to clear brush on abandoned lots or board up windows on abandoned homes. But in the event that a storm does occur and damages the foreclosed homes, one bank's spokesman told the Herald, banks have the same plan as any other homeowner: They're going to file an insurance claim.