Illinois gets federal money to demolish blighted homes

March 27, 2014

WBEZ/Tricia Bobeda
File: A block of 'prairie' in Chicago's Englewood neighborhood.The city has more than 15,000 vacant lots in stock.

Some parts of Illinois’ housing market seem to be on a somewhat steady recovery. But communities such as Englewood on Chicago’s South Side struggle to even stabilize.

Illinois was awarded $445 million in federal foreclosure prevention resources under the U.S. Treasury Department’s Hardest Hit Fund. Today, the Treasury announced it will allow $30 million from that fund to help demolish vacant properties in blighted areas around the state.

Mark McArdle is the chief homeowner preservation officer of the Treasury Department. He says blighted properties not only bring down property values in a neighborhood, but can attract crime.

“You have homeowners that are trying everything they can to stay in their house, but when they have two or three vacant houses on their block at some point they say, ‘Why am I fighting so hard to stay in this home?’ So this [puts them] in a more sustainable position,” he said.

McArdle said only a few other states have used the funds for demolition. Michigan was the first. He said it is too early to quantify direct results, but said research shows blighted homes are a destabilizing force.

“You want to keep the person not only in their home but make sure the neighborhood where that home is located is stable as well,” he said.

Not everyone in the neighborhood will agree with demolition as a solution to stabilize. Mary Kenney, executive director for Illinois Housing Development Authority said the state has helped to keep people in their homes and helped rehab troubled properties, but not every house can be saved. Kenney said demolition is the next step in neighborhood stabilization.

“Aside from the fact that they’re eyesores, they’re often dangerous. We see a lot of mischief around these properties. I think our first goal is to really make sure we’re eliminating that from these communities,” Kenney said.

Eligible communities can apply for demolition assistance starting this summer and will also be responsible for upkeep of the resulting vacant lot.

The first demolitions with federal funding could happen as soon as this fall.

Susie An is WBEZ’s business reporter. Follow her @soosieon