Vacant properties are becoming a growing concern for municipalities and homeowners in the United States. According to data from LendingTree, over 5.6 million homes are currently empty across the 50 largest metros nationwide.
Thankfully, the days of letting an unoccupied property fade into the background are over for many. Local regulations are making it mandatory for homeowners to register their vacant properties. The consequences for noncomplying with these rules can be steep.
This vacant property registration trend started during the 2008 financial crisis when thousands of homeowners abandoned their homes because they could no longer afford them. Many of these abandoned properties were repossessed by lenders and left untouched instead of being sold at lower prices.
As a result, these homes, with overgrown lawns, boarded windows, and disconnected utilities became eyesores in vibrant neighborhoods. Many such homes even became magnets for squatters.
Vacant Properties: A Lingering Issue
Although the housing market has largely rebounded, remnants of that era remain. According to reports released by ATTOM Data Solutions, the third quarter of 2024 saw approximately 223,000 “zombie homes.” These properties were abandoned before the foreclosure began or are moving through foreclosure. While this figure may be alarming, it shows only a fraction of the total housing stock in the US.
ATTOM CEO Rob Barber highlighted that fears of a surge in abandoned properties after the end of the COVID-19 foreclosure moratorium have yet to materialize. For him, abandoned properties “remain an anomaly throughout most of the country.”
Barber added, “Fewer owners are simply walking away from their properties like so many did after the Great Recession of the late 2000s.” This increased concern over vacant properties, prompting cities and counties to enforce stricter oversight.
Stricter Regulations and Rising Fees
In recent years, municipalities in every state have enacted ordinances on empty properties. These ordinances aim to maintain community aesthetics and also generate revenue. Registration fees vary widely from one jurisdiction to another.
For instance, in Henderson, Nevada, homeowners need to pay a hefty $848 annual fee to register for a short-term rental, while in Nags Head, North Carolina, the cost is only $25.
The scenario is different for penalties for non-compliance. In North Palm Beach, Florida, failing to register a rental property can result in civil penalties, while Sarasota imposes a $200 late fee in addition to its initial registration cost of $500.
The District of Columbia has one of the most severe policies. Registering a vacant home can cause property taxes to spike from 85 cents to $5 per $100 of appraised value. If the property is considered blighted, the rate can jump to $10.
Local officials often use creative methods to identify unregistered vacant properties. In Washington, DC, authorities frequently monitor water and electricity bills to find long-term vacant properties.
What Homeowners Need to Do
Those who own vacant homes or rent properties seasonally should be aware of all local property regulations. Local laws can change frequently, and missing a registration deadline or failing to meet upkeep standards can lead to significant penalties.
As Jeff Connell, a senior vice president at property preservation company MCS, recently remarked, “Registration requirements change frequently.” Connell advises staying vigilant about evolving regulations and nurturing relationships with local code enforcement agencies, as it can be beneficial in negotiating fines if violations occur.
It’s not just about paperwork; maintaining the property is equally important. Many areas have strict property upkeep requirements, ranging from grass trimming to clearing storm debris. Broken windows, damaged fences, and neglect can trigger penalties or increased scrutiny from local authorities. Homeowners also face potential legal issues if squatters take up their neglected residences.
An Ongoing Challenge
For municipalities, the drive to regulate vacant properties often goes beyond aesthetics. These amounts collected through penalties serve as a vital revenue stream for cash-strapped local governments. Yet, the primary objective is to prevent neglected homes from dragging down entire neighborhoods’ appearance and property values.
The vacant property registration movement intends to change the approach to handling empty homes. Gone are the days when an unoccupied house could quietly fade from view. Today’s homeowners must navigate a patchwork of local regulations, keeping their properties registered and well-maintained to avoid costly penalties.
