Vacant Homes Impose Big Costs On Cities Amid Budget Crises: GAO

The foreclosure crisis is costing cities at a time when they can least afford it.

Millions of homes in America are standing vacant, and in many cases they represent a financial sinkhole for their communities . Local governments -- forced to absorb the costs of maintaining or razing these homes, and seeing property taxes plummet in response to the spread of urban blight -- are increasingly shouldering the burden of the country's slumping housing market, according to a report released Tuesday by the U.S. Government Accountability Office.

Assuming responsibility for millions of vacant homes comes as just one more source of economic pressure for many American cities, which are straining to do more with less in an atmosphere of budget cuts and dwindling tax revenues .

The report notes that the number of vacant properties in the United States grew by more than 50 percent between 2000 and 2010 -- a decade that included two recessions and a catastrophic collapse of the national housing market.

In 2000, there were about 6.8 million vacant homes in the U.S., according to the GAO. By 2010, that number had jumped to 10.3 million -- a rise encompassing countless homeowners in default, with their wealth all but erased in the sharp plunge of real estate values that accompanied the burst of the housing bubble.

The rapid spread of vacant homes has taken a toll on local governments, which often incur costs as a result of so many properties standing empty. The municipal costs of high foreclosure rates have been observed for some time , but the GAO report makes clear the scope of the problem.

While the upkeep and maintenance of a vacant home is technically the responsibility of either the homeowner or the mortgage owner, in practice it often falls to the town, which has to pay for basic services -- like cutting the grass, boarding up windows and draining swimming pools -- to keep the property from falling into total disrepair. Alternatively, the town can have the vacant property demolished.

Either way, the tab for cities and towns is often high. Detroit, for example, has paid $20 million to demolish 4,000 properties in the past two and a half years, the GAO found.

Communities incur costs in other ways as well. The GAO noted that vacant homes are often associated with crime and accidental fires, which require the attention of police and fire departments, thus tying up city resources. And cities often see their property taxes fall as vacant homes drive down the value of homes around them.

The foreclosure crisis -- which has pushed home values down to historic lows in recent years, and directly resulted in many of the vacancies that came into being between 2000 and 2010 -- is thought to be less than halfway over , according to a recent report from the Center for Responsible Lending.

This week, the Occupy Wall Street movement -- which has faced increasing resistance in its attempts to inhabit various public spaces -- aligned itself with distressed homeowners in a day of mass action. Occupy protesters moved into foreclosed homes, and took up the cause of homeowners facing eviction, in about 25 cities Tuesday , saying they were working to bring attention to a national crisis.